Money for Nothing

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Companies that place the alerts for you, like LifeLock and Debix, say that going without their service is like mowing your own lawn or changing your vehicle's oil yourself.

The analogy is flawed, because mowing your lawn or changing your own oil is actually hard work. Sweat will probably be involved, and the chores will take a chunk of time, unlike performing for yourself the service that LifeLock offers.

Placing a fraud alert yourself is a cakewalk. All you have to do is dial the toll-free phone number of one of the major credit bureaus. The process will take less than five minutes, maybe as little as two or three minutes. You have to notify only one of the major credit bureaus of a fraud alert because that bureau will then notify the other two. If you let six months go by without placing an alert, no biggie — remember, you probably don't need it in the first place.

If you've already become a victim, and you've got an official identity-theft report, it would be downright dumb to pay someone to place the fraud alert. That's because victims have the right to place a seven-year fraud alert, eliminating the need for frequent renewals.

Pulling your credit report is another service these companies offer that you can do for free. Simply log on to the secure Web site www.annualcreditreport.com, or call 1-877-322-8228 and punch in some personal data.

You can pull the reports of all three bureaus once a year, or stagger your reports by pulling one from each bureau every four months. Most of the time, though not always, the records at the three bureaus are the same.

"Getting your credit report three times a year should be enough to find out, generally, what's going on," says Gail Hillebrand, a senior attorney for Consumers Union, the nonprofit publisher of Consumer Reports.

It costs about $9 to see your credit score, but the credit bureaus will give you the score and other data during a free, month-long trial period. Hillebrand says that's not a bad way to go, as long as you're careful to cancel the membership before the free trial ends.

The two measures — pulling your credit report and placing fraud alerts — are so easy that you would spend just as much time and effort signing up with a service company. And ask yourself, when the company starts sending you regular e-mails, credit reports, and other information, will you really take the time to study all of that? Probably not, if you don't even have time to pull your own credit report.

If you never look at your credit report and you haven't placed a fraud alert, it's easier for someone to take credit out in your name. Being a victim will make you feel violated and ticked off. It will definitely cost you some time.

The service companies want you to believe you'll be devastated.

The truth is, police and prosecutors say, severe cases of identity theft are rare. With some legwork, financial damage is almost always reversed, says Annielaurie Van Wie, a prosecutor with the Maricopa County Attorney's office.

"I haven't seen people having a lot of problems with that," she says.

That means you're likely to pay one of the service companies more over time than you ever will ever be out in an identity-theft scam.

Sure, you'd rather not have it happen at all, but if it does, your involvement could help convict a thief. That's what happened after an ex-con pretended to be Cameron Dana of Mesa.

Last year, a man using Dana's name took out a $20,000 commercial loan at a store by filling out a form. Once the credit was approved, the first thing he bought was a utility trailer. As store employees looked on, thinking they were seeing the birth of a construction company, the man packed the trailer with new power tools and other supplies until the funds were exhausted. Then he hitched the trailer to his new Ford F-350 diesel pickup and drove off.

The man was really Richard Hainsworth, a 36-year-old meth user. Armed with Dana's identification, Hainsworth acted like a lottery winner for about two weeks, racking up about $75,000 in charges.

Only after Hainsworth visited another Home Depot, this time in Mesa, did anyone get suspicious. When he applied for $1,000 in personal credit and promptly bought about $1,000 in goods, someone at the store notified Citigroup, the company Home Depot uses for its credit services.

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Ray Stern has worked as a newspaper reporter in Arizona for more than two decades. He's won numerous awards for his reporting, including the Arizona Press Club's Don Bolles Award for Investigative Journalism.