LifeLock fined $12 million over lack of life-locking ability

[DainBramaged]

Identity theft prevention service LifeLock is not as pristine as its reputation claims after all. The company agreed to pay out $12 million to settle charges with the Federal Trade Commission and 35 states, which had said that LifeLock's identity-theft-prevention claims were false and that the company actually made its own customer data available and unsecured from theft. As it turns out, there is no way to fully guarantee that identity theft won't happen, no matter what someone puts on the side of a truck.

LifeLock has made a name for itself as the go-to service if you never want to have any part of your identity stolen, ever. The company claims to proactively protect your information against fraud, alert you to any kind of shady activity, and reduce credit card offers for $10-15 per month. Those who have seen LifeLock's trucks driving around their cities know that the company used to slap its CEO Todd Davis' social security number on the side of the vehicle along with a number of claims guaranteeing that its customers won't fall victim. (As an aside, Davis' identity allegedly ended up getting stolen in 2007.)

According to the FTC, LifeLock has long claimed that it's the first company to prevent identity theft from ever occurring, that it will never happen to you if you become a paying customer, and that it can stop fraudulent activity before it happens. "Guaranteed." However, the company only employed limited protections on behalf of its users—LifeLock apparently only went so far as to place a credit alert on its customers' credit reports, says the FTC, and barely did anything else.

http://arstechnica.com/tech-policy/news/2010/03/lifelock-cant-guarantee-id-theft-prevention-after-all-settles-with-ftc.ars

[Canuckistanian]

1. They sure made a lot of commercials, though

Seems like every second radio commercial was from Lifelock. Well, at least they kept some radio stations from going under.

[DainBramaged]

2. Somehow when the dust settled, you knew in your heart it was all crap

Within the article is a link to a Wired article from 2007 where Todd Davis was foreced to resign from Lifelock and how his identity was STILL stolen for a payday loan........


:rofl:

[Canuckistanian]

5. Yeah, I remember that

Quite frankly, I don't get the concept. How in Hell, with all the MILLIONS of ways for hackers to steal your identity, could they do what they promised?

All it did was allow people to think they were invincible and to be MORE reckless. It probably caused MORE identity theft than it prevented.

[ima_sinnic]

6. they did what any consumer can do for free: put a fraud alert on your credit report

you simply call one of the three credit bureaus--they each have a "fraud alert" page on their websites--and say you want a fraud alert added to your report, and that credit bureau is obligated to tell the other 2 bureaus to add the "alert" to your report. Then, when you apply for credit, the person you are applying from MUST call you to confirm that it is you applying. It works well if you're not planning to apply for credit--if you do, it will hold up the application. After you sign with the banker, you'll have to go home to receive the call (or get it on your cell phone), to give permission and confirm that it was you.

The fraud alert is good for 6 months, I believe.
By the way, when you put a fraud alert on your credit report, you are then entitled to a free copy of your credit report from each of the 3 bureaus.

You can also do something even stricter, a "credit freeze," but this really makes it hard to apply for credit.

The three bureaus are Experian, Equifax, and Transunion.

To think this totally prevents "identity theft" is bogus. All it does is prevent people from applying for credit with your name and SS number--but guess what? Payday lenders don't check credit reports, so they would be unaware of a "fraud alert."

[G_j]

8. interesting stuff

thanks!

[Historic NY]

3. Thats what he gets for having Rush as a spokesman...

[DainBramaged]

10. You sort of knew i was a scam when the software started showing up in Target

for $39.95 for six month subscription.

[Historic NY]

11. the CEO is also a registered Lobbyist..imagine that.

[drm604]

4. It never sounded right to me.

I never understood how they could do what they claimed.

[donco6]

7. Recced just for funny title.

Lack of life-locking ability LOL!

[petronius]

9. It reminds me of the joke about the guy who raffled off the dead mule

Lifelock only has to pay out to people who can prove they've been victims, but they get to keep the fees from everyone who isn't...

[Greyhound]

12. We were just talking about this scam on the way home tonight.

That idiotic commercial came on and I noticed that the verbiage had changed.
:rofl:

Couldn't happen to a nicer bottom-feeding fear-monger, I only hope somebody takes the trouble to put him out of business.

[DainBramaged]

13. I pay about $25 a year to State Farm in my homeowners/tenants insurance

to protect me from identity theft. They have a huge division now to handle these complaints and help clients wade through the mess if your identity is stolen.

[proud2BlibKansan]

14. I just bought that same policy

I was amazed it was such a reasonable price.

[DainBramaged]

15. I was shocked when my agent called to tell me to add it last year

I am pleased they are taking identity theft seriously. Except for a three year period where I believed the crap from Progressive (and after I left because they conveniently bumped my rates up every year), I've been insured by State Farm since 1966 and accident and ticket free since 1976. They simply can't be beat.