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Lifelock Problems - What Problems?

Saturday, November 8th, 2008 Subscribe To Our Feed

A few months a go we had several Lifelock problems make the news but in truth Lifelock didn’t seem to be effected and continued their growth, now having over a million customers. Lifelock is still the the number 1 choice in identity theft security despite several new companies waiting in the shadows to take over should the Lifelock problems have proved to be lethal.

Back in May we had the story breaking of several customers taking class action lawsuits against Lifelock over claims their advertising campaign was misleading.

The claim was based on the fact that Todd Davis gives out his social security number in Life Lock advertisements to prove how confident he is in the protection provided by Lifelock. It seems they felt, or at least their lawyer felt that this is misleading because actually some guy took out a cash loan for $500 using the SSN of Todd Davis.

This made the news and why wouldn’t it, it’s a great story but then as the story ran it came to light that actually Lifelock had worked for Davis. The person who took out the fraudulant loan was caught and more just as importantly, Davis credit file remained squeeky clean.

We also learned that none of the customers who were attempting the lawsuit had actually suffered a case of identity theft and had not even cancelled their Lifelock subscription. The story quickly got buried once it became clear the person behind it was a opportunist lawyer who’d found a new fat cow to chase.

The next Lifelock problems seemed to be a little more serious. Experian, one of the big 3 credit bureaus were claiming that the service provided by Lifelock could be done by a person without the need of a monthly charge.

Lifelock, acting on a on behalf of their clients, place a fraud alert on their credit file which means extra care should be taken when offering credit, loans etc. Basically it means the person has concern their identity may have been compromised so please double check before opening offering credit or giving out a loan. By the way, the person who took out the $500 payday loan in Davis name was successful because the company handling the loan admitted to ignoring the fraud alert.

Experian tell us you can place this fraud alert yourself so Lifelock are taking monthly subscriptions under false pretences. At first glance this looked like serious Lifelock problems and again the press jumped in to what seemed a good story.

A little bit of digging by a few journalists who prefer to report news rather than just a good story again showed that what appeared to be Lifelock problems, actually had ulterior motives.

It seems Experian do not like fraud alerts on credit files. They slow down the the business of issuing credit and creates work for the credit bureaus. It’s because of this that a fraud alert only lasts a limited period. You then have to go through the whole process of applying for the fraud alert again.

Lifelock take care of all this for their clients each quarter and should something go wrong and an identity gets misused, they have a guarantee that kicks in to the tune of a cool $1 million and it’s this their customers are happy to pay the ten buck fee for.

One other reason Lifelock are not the favorite company of Experian is because Lifelock remove their customers names from mailing lists. The theory being if you aren’t receiving credit card offers through the post, they can’t be stolen and accepted in your name without your knowledge.

This sounds a really good idea right? Well guess who sells the credit card companies the names of affluent middle class Americans who the credit card companies want to target? This is huge business for the Experian and the other 2 credit bureaus as these lists are extremely targeted and thereforeextremely valuable. Imagine sending out your credit card or loan offer to people you know for a fact already have several cards and an income of $100K a year instead of merely posting to the masses and hoping for the best?

As with many new highly successful companies, ulterior motives are usually found when stories start appearing in the news and the Lifelock problems are no different.

If you were considering signing up with Lifelock, make your decision based purely on the service they offer, not on the Lifelock problems that you may have read about back in the Summer.

It’s worth remembering that yes you can do what Lifelock does yourself. You could probably also service your car yourself if you wanted to and some people do. Others though like the peace of mind that comes with the knowledge that a professional has done it for them and should they mess up, there is a full guarantee as back up.

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