It happens almost every day, third parties perform credit checks on
unsuspecting individuals without their knowledge. Sometimes those checks are
for legitimate purposes such as new credit card applications, but other times
they’re performed by criminals seeking to steal identities.
Redwood City, Calif.-based startup TrustedID thinks that it has the simple
answer to stopping identity thieves from stealing your personal information.
The solution? Give consumers control over access to their credit reports and
information.
As opposed to other solutions in the marketplace which enable users to
monitor their credit after the fact, Scott Mitic, co-founder of TrustedID
claims that his firm’s IDfreeze solution enables users to proactively
prevent identity theft.
There are two components to the TrustedID IDfreeze solution. Lender
DoubleCheck requires that the credit agencies actually check with the
recipient of the credit to make sure that the credit was in fact requested.
“We notify the credit bureaus to put an alert on your credit file and keep
it there over the course of your membership,” Mitic told
internetnews.com. “This requires lenders to verify your identity
before they do anything which could negatively affect your good standing.”
The second component of the TrustedID solution set is a service called
CreditLock. It locks a users credit report on all three (Equifax, Experian
and TransUnion) credit reporting agencies and does not enable anyone to
check or issue credit on a users behalf without the users permission.
The CreditLock service is currently only available in 12 states which have legalized services like CreditLock that let you “freeze” your credit report; in 3 of these states (Illinois, Vermont, WA), you can freeze it only if you have already been a victim of identity theft. The other states are: California, Colorado, Connecticut, Louisiana, Maine, Nevada, New Jersey, North Carolina, and Texas.
According to Mitic, new federal legislation is expected by the end of the year that would make services like CreditLock available nationwide.
“CreditLock eliminates the risk of anyone getting new credit in your name,”
Mitic said. “If a lender can’t get your credit report they’re not going to
issue you a credit card.”
Mitic explained that other services currently in the market only provide
monitoring services which isn’t enough to actually solve the problem of ID
theft.
“If we are going to solve the identity theft problem it can only happen in
one way,” Mitic said. “That is we go to the headwater of the problem, which
from our perspective is the three credit bureaus, and lock it down and let the consumer decide how their data is shared.”
Omar Ahmad the other co-founder of TrustedID said the credit
bureaus have been less excited about this because they make money selling
data.
“By putting notices on and locking down your data you basically are no
longer a money revenue source for them,” Ahmad told internetnews.com.
TrustedID isn’t about to become a new potential vehicle by which consumer
data is lost either. Ahmad is the ex-CIO at Napster which he notes
nearly everyone was trying to hack at one time or another. The key to
TrustedID is that it doesn’t actually hold your credit bureau information.
“From a data standpoint, we actually have very little data,” Ahmad
explained. “I don’t have your credit data, I don’t know what it is and I
don’t frankly care. What I’m doing is getting enough information to uniquely
identify you at each of the credit bureaus and then I put a lock on it.”
The TrustedID IDfreeze service is free for the first 30 days after which it
costs $7.05 a month.
