Another Id theft service being slammed in the media by the same attorneys who are suing LifeLock.

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(UPDATED below)The same attorneys suing LifeLock appear to be coming across as our new consumer guardian & a watchdog overseeing identity theft prevention companies and advertisements that may confuse us! I am not confused -about LifeLock's services, I am confused at how our system of justice works -or doesn't work.

Consumers who have been harmed and have legitimate damages continue to find it extremely difficult to gain public attention or access to our courts. Yet lawsuits such as the latest class actions filed against LifeLock seem to have created an orgainzed media frenzy and smear campaign designed to deem LifeLock guilty in the court of public opinion. But guilty of what?

What hasn't been pointed out in the media is that the plaintiffs in these cases never suffered an identity theft , they never contacted LifeLock with any reported problem and they never once requested their subscription money be returned.

Rather, they abruptly filed a lawsuit -a class action. They claim to be helping the rest of us in getting our money back. But, what if the 1 million subscribers who purchased these services -don't want their money back?

Maybe a closer look at the lawsuits and the complaints, would help us to understand what/who is really behind these lawsuits. Who will really benefit from these lawsuits? And should they?

These types of frivilous lawsuits can have a destructive effect on our justice system and public perception of legimately filed lawsuits damaged. Hopefully the Judges hearing these cases will agree!

Many wish these attorneys would take a closer look at advertisments that are truly confusing to the public.

Most specifically, those "free credit report" sites and advertisments that aren't really free unless we sign up for credit monitoring. I haven't seen one commercial that advises the public they are entitled to a free annual credit report and how/where to get it. The toll free number to do so (877-322-8228)

Since Experian's lawsuit was filed, interestingly, I haven't seen any of the other identity theft prevention companies in the media come out in support of LifeLock -and that could be dangerous to their own safety. Many of them quickly reported LifeLock's legal woes, some offered discounts to LifeLock subscribers and gave the impression they may be wishing for LifeLock's destruction. With our latest self-proclaimed consumer watchdogs scouring websites and advertisements claiming to look out for consumers...we don't yet know who might be next. Be be careful what you wish for...

Identity-theft services face legal test
Suit targets claims by rival of local start-up

Source: Boston Globe

IdentityTruth Inc. of Waltham says it will reimburse customers up to $2 million if they're victims of identity theft. But a Phoenix lawyer says the identity-protection company's promise isn't worth nearly that much.

IdentityTruth charges $10 a month or $100 a year to insure people against unauthorized use of their personal information. The privately held company is funded with about $20 million in venture capital from investors that include Argonaut Ventures and Stata Venture Partners. It's one of a host of companies that say they protect consumers from identity theft crimes, which cost Americans $49 billion last year, according to Javelin Strategy & Research Corp.

IdentityTruth posts fraud alerts with credit reporting agencies on behalf of its customers. These alerts warn banks and other businesses not to open new accounts unless they confirm the identity of the customer. In addition, IdentityTruth scours the Internet and a host of private and government-run databases, looking for evidence that somebody out there is pretending to be you. The company doesn't actually pre vent identity theft; it's designed to warn you immediately when a theft occurs.

"We really focus on technology to give you that early warning," said IdentityTruth chief executive Steven Domenikos.

The IdentityTruth website states, "if you are a member of our service and are a victim of identity theft resulting in the loss of your money, we will reimburse you up to $2 million."

But Rob Carey of the law firm Hagens Berman Sobol Shapiro in Phoenix said the fine print of the IdentityTruth guarantee belies this assertion. Carey recently filed a lawsuit in the US District Court of Arizona against a rival service, LifeLock Inc. of Tempe. The suit, which seeks class-action status, claims LifeLock's $1 million guarantee is fraudulent because it contains loopholes that make it far less generous. Carey said the same loopholes are present in the IdentityTruth guarantee.

For instance, the guarantee covers damages caused by a failure of the IdentityTruth service. But banks often ignore fraud alerts. If that happens and an IdentityTruth customer gets stung, the company isn't liable, because the bank failed, not IdentityTruth. "What did they do wrong?" Carey said. "Their product worked as designed."

In addition, the IdentityTruth guarantee excludes coverage of "consequential damages." According to Carey, that would include any debts incurred by an identity thief. If a user of the service was unjustly saddled with a $10,000 credit card bill, for instance, "they're not covering that," said Carey. "They're specifically exempting that from coverage."

David Masciulli, IdentityTruth's director of customer service, agreed that his company's guarantee doesn't specifically promise to cover all costs of an identity theft, but said that most customers would be made whole. "We do what we can do for the user, if they suffer a loss from a malfunction in our service," Masciulli said. Asked why the guarantee doesn't cover debts incurred by identity thieves, he replied, "The reality is that most of the money that would be lost here would be covered by the person's bank."

Lisa Gerber, a financial technology program manager for Merrill Lynch & Co. in New York, said IdentityTruth revealed problems she'd never have found on her own. Gerber signed up for IdentityTruth in February and was soon warned that someone using her name and date of birth had ordered telephone service at several addresses where she'd never lived. A fraud alert service would probably not have detected these intrusions. Gerber is now working with IdentityTruth to clear her record before she's saddled with unpaid bills.

"I absolutely would not have found this," Gerber said. "It's really great for me to spend $10 a month to have somebody else do it."

But James Van Dyke, president of Javelin Strategy, said consumers shouldn't be too quick to sign on with any identity theft preventers.

"There's some real value with all these products," said Van Dyke. But he added that with a little effort, consumers can protect themselves at no cost. For instance, people can contact the credit reporting services to request free fraud alerts. And while Van Dyke admitted that few people can search multiple databases for evidence of fraud, they can be more careful in handling personal data. For instance, Van Dyke said people should get all their bills via e-mail and pay them online, to eliminate paper bills, which identity thieves frequently steal when they're tossed in the trash. For more see: Boston Globe

Please note that this blog was written in 2009. My views on identity theft protection services have greatly changed, as did the services offered, the policies and less than transparent partnerships. In an effort to ensure these older blogs don't mislead readers, please take time to check the date of any blog relating to identity theft protection services. Anything dated pre-2012 that has not been updated, should NOT be considered as an accurate portrayal of today's informed opinions.

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