Longform

Money for Nothing

Page 6 of 9

A company called PrePaid Legal Services Inc. employs armies of independent contractors to help sell its anti-identity-theft services, which are actually provided by Kroll Fraud Solutions. Because of that apparent lack of control, Hartle, the identity theft expert, singles out PrePaid Legal as a company to be particularly wary of.

To the contrary, says Robert Garcia, a retired 25-year veteran of the Tucson Police Department who represents the company. He says Kroll performs background checks on its freelance workers, unlike other companies in the field. He says no PrePaid Legal employee has ever misused a customer's personal information.

Even if it's safe to use PrePaid Legal, potential customers might tremble at the price. Garcia says he recently contracted with the city of Tucson to offer city employees a plan that costs $25 a month, more than twice as much as typical protection services. Sure, the price includes help with legal matters, like wills, but people usually don't rewrite wills every month.

Van Wie, the county prosecutor, attends community meetings around the Valley regularly, and people often ask what she thinks of anti-identity-theft services. She says she doesn't recommend them.

If anything, she believes the plans offered by the credit bureaus make the most sense because they hold the credit reports.

"I don't steer people toward anything, but I'll say, 'Look at what you're getting for your money,'" Van Wie says. "I explain how to do it themselves."

Van Wie's bureau filed more than 2,600 cases of identity theft-related crimes last year, including 15 cases of trafficking in stolen identities. Her office couldn't immediately break down how many of the cases were serious and how many were resolved with little hassle and no expense to the victims.

Van Wie does not use an identify theft service personally.


The credit history of LifeLock's CEO was hardly blemish-free before the Texas thief stole his identity. Like the company's founder, Robert Maynard Jr., Todd Davis also has a bankruptcy on his record. He filed in 2000 to escape about $82,000 in unpaid bills, federal records show.

His credit score might be higher now, if you believe the two-year-old company's claim that it has gained tens of thousands of customers just in the past month. It just moved into a second location at Hayden Ferry Lakeside Office Tower II, on the banks of Tempe's Town Lake.

It's true that LifeLock has become one of the most recognized names in identity-theft protection because of its robust radio advertising on the Howard Stern, Rush Limbaugh, and Paul Harvey shows.

But if you listen to its competitors, LifeLock is also one of the biggest jokes in the industry — which is really something, considering the industry as a whole isn't much better.

LifeLock's marketing style and its ability to find both customers and investor funding makes the bosses at other companies fume with indignation and, perhaps, jealousy.

Then came New Times' May 31 story, which focused on Maynard, and much of that fuming turned to glee.

"I can't lie to you," says Goodman, general counsel for Identity Theft 911. "I was very pleased with [that] story."

Maynard had been telling a tale for two years that he was falsely arrested by Valley authorities in 2003 and held for a week in jail because of a Mirage Casino debt he didn't owe. The experience gave him the idea to start LifeLock, he said. The story was retold to newspapers and TV news stations by Maynard and Davis as a horrific example of why people need the company's services.

After New Times revealed Maynard's story was full of holes, California-based Truston began offering discounts to LifeLock customers who switched services. Debix later did the same thing. Company spokesmen rushed to the comment sections of industry blog sites to pile on LifeLock — and plug their own companies as a better alternative.

But some loyalty to LifeLock was evident in an avalanche of Internet tongue-wagging that followed the article. On one blog site, TechCrunch, editor Michael Arrington posited that a "hit job" on LifeLock might have been part of a conspiracy by the credit bureaus, which ostensibly don't want LifeLock to steal business from them.

The New Times story became even more widely read when, the day after it was published, presidential candidate Fred Thompson announced he had done a radio ad for LifeLock that would air over the next two months.

The timing of the story and other articles about Thompson's involvement became an embarrassment to Thompson as his critics used the LifeLock ad to bludgeon him. The Los Angeles Times covered the development in a June 9 story titled "An Awkward Ad by Fred Thompson," which also mentioned Maynard's bogus claims of identity theft but uncovered no new information.

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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.