By Teresa McUsic

Texans now have one of the better laws to freeze your credit reports as a protection from identity theft—but it’s going to cost you.

The $30.83 charge to freeze your reports at all three credit bureaus will be worth it for many, however. The D/FW-Arlington area ranked fourth in identity theft complaints in 2005, according to the latest data from the Federal Trade Commission. Texas also ranked fourth in ID theft complaints among all of the states.

Nationwide, there are 10 million victims of identity theft a year.

Freezing a credit report is a way to safeguard against identity theft. With a freeze, no one is allowed access to your report on file with each of the three credit bureaus without your approval.

The new state legislation, which went into effect Sept. 1, strengthened the state’s previous credit report freeze law enacted in 2005, one of the first such laws in the country.

“It’s now the strongest law in the country,” said Lawrence Wilson, director of the Identity Theft Victim Support Group of North America, based in Plano. “I would highly recommend everyone freeze their bureau files.”

The new law has several important consumer features. Among them:

• No police record required. Texans can now freeze their credit report for any reason and without the previous requirement of proof of identity theft by a police record.
• Fast thaw in 15 minutes. Consumers can unfreeze the report temporarily by phone or letter using a unique Personal Identification Number or PIN. By law, the three credit bureaus must unfreeze an account within 15 minutes if called by the account holder, or three days if contacted via mail. This “fast thaw” feature is on the books in several states, but Texas is the first state in the country to enact it.
• Target audience. Consumers can unfreeze accounts specific to just one entity. For example, if you want to buy a cell phone service or a car, just one company can be allowed to look at your credit report.

While a few states, like New Jersey, have no fees for freezing a credit report, most do have some fees attached, and Texas is no exception.

To freeze or unfreeze your account in the state, identity theft victims with a police report will not have any charge.

But if you are not an ID theft victim or don’t have a police report, you will have to pay each of the three credit bureaus $10 to freeze your account and send the request by certified mail.  (Experian charges sales tax, so the charge is $10.83.)

To unfreeze your account, either permanently or temporarily, will cost nothing at Experian and $10 at TransUnion. Equifax will charge $10 for a temporary lift, $12 for a specific target audience and will not charge to have the freeze removed permanently.

Still, compared with the credit monitoring services offered by the credit bureaus, the fees for a freeze are still a bargain.

“Over the last two or three weeks, I’ve talked to a couple thousand people in my seminars about the change in law,” said Wilson, who holds free identity theft seminars for victims and charges a minimal fee for groups. “Many of them are paying $90 to $120 a year for credit monitoring that doesn’t do much.”

Credit monitoring services typically alert the credit report holder to unusual activity in their report, but by then some damage to your identity has likely already been done, Wilson said. Credit freezes will not allow any new accounts to be taken out without your knowledge.

To date, 39 states and the District of Columbia have some form of credit freeze legislation, said Michelle Jun, staff attorney with Consumers Union.

“There aren’t that many things consumers can do proactively to protect their identity, and this is one of the best tools going,” she said.

CU has developed an online guidebook for consumers of all of the state laws on credit report freezing at www.financialprivacynow.org

“Consumers have been finding it difficult to find this information elsewhere,” Jun said.

More information can be found at Wilson’s website at www.txfreezelaw.com

Although nearly 10 million Americans fall victim to identity theft each year, only a small fraction of the population, around 50,000 credit reports have been frozen, according to a spokesman for the Consumer Data Industry Association.

One reason for the low number may be the “hassle factor” associated with the freeze.

“You do have to keep track of the PIN,” said Maxine Sweet, vice president of public education for Experian. “I spent yesterday helping a man who was buying a house track down his PIN. He was really sweating it.”

Putting the Freeze on your Credit Report:

• First check all three reports for errors. This can be done for no cost over the Internet, by phone, or mail. For online access, go to www.annualcreditreport.com. Be sure to type in the exact website name. You will be asked several security questions about past accounts. To get your report in the mail, call toll-free (877) 322-8228. You must give out your name, address, phone number, Social Security number and birthday. You can also fill out a request form at the website and mail it in to Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281. Request forms can be downloaded at www.ftc.gov/credit or by calling the FTC helpline at (877) 382-4357 and asking for its “Your Access to Credit” brochure that includes the form.
• Correct errors. This includes any misspellings of name, incorrect addresses and spousal information. If your spouse’s Social Security number is listed, have it removed.
• Tainted files need report. If your file has accounts not known to you, it has been compromised by an identity thief. A change in Texas law last year allows you to get a police report against such action where you live. There is no charge for this report, and it will allow you to freeze your account for free. .
• Send letters certified mail.  If your report is clean, send your request for a freeze by certified mail. Sample letters can be found at Consumer Union’s website, www.financialprivacynow.org.

Send letters with proof of identity and address and $10 to:

CSC Credit Services (Equifax)
Security Freeze
P O Box 674438
Houston, TX  77267-4438
           
TransUnion Fraud Victim Assistance Dept.
P.O. Box 6790
Fullerton, CA 92834

Experian Security Freeze
P.O. Box 9554
Allen, TX 75013.
(Note: Experian requires sales tax, so send check for $10.83.)