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Debix's better credit fraud alert

Consumer Reports News: August 03, 2009 12:44 PM

In my last blog, I mentioned the potential demise of the current paid fraud alert system, courtesy of a U.S. District Court ruling prohibiting commercial entities from placing fraud alerts on credit reports for paying customers. As we’ve reported, consumers can place those alerts themselves for free, though those alerts aren’t always enough to stop fraud.

Debix is one such company that’s agreed to stop placing such fraud alerts. But in its place, the company has come up with a better mousetrap, for a fee, that may well be worth the money.

Debix’s current system relies on fraud alerts as a “trigger.” When a prospective lender sees the fraud alert, the lender is supposed to call you through the Debix phone system, which gives you an authorization signal (so you know the call is legitimate), and informs you that someone is applying for a loan in your name. The lender then asks you to push the appropriate button on your phone to indicate whether the loan application is legitimate. If it’s not, a Debix investigator gets on the phone, conferences in the lender, and gathers information about the fraudulent application, including names, addresses, and description of the crook applying for the loan.

Debix says this system has prevented more than 2,900 thefts since July, 2007. In the past, we approved of the Debix system for those consumers who wanted to pay for such a service. 

However, “fraud alerts rely on the creditor to do the right thing” and make the phone call to the consumer, says Bo Holland, CEO of Debix. “In many cases creditors did not follow through.”

So, starting in September, Debix will use a much more reliable trigger that doesn’t depend on a fallible human lender. Debix now plugs right into your credit report, so that whenever someone applies for credit in your name and a prospective lender checks your credit file, that inquiry will instantly trigger a call to you and set in motion Debix’s other impressive security procedures.

That is a much more reliable system, and, because it significantly improves the protection provided by the standard free fraud alert, we now believe consumers should prefer Debix over the standard free fraud alert. The Debix service costs $9.95 per month per adult and $2.50 per month per child.

IDSecure, which charges $12.99 a month (the first month is $1) for fraud protection services beyond just fraud alerts, now provides a link for its customers that allows them to file fraud alerts themselves directly with credit bureaus.

 Of course, you can file free fraud alerts yourself online directly with the credit bureaus.

•Experian: Click here.  

•Equifax: Click here

•TransUnion: By Email: fvad@transunion.com; By Phone: 800-680-7289; By Mail: P.O. Box 6790, Fullerton, CA 92834

–Jeff Blyskal 

   

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