Hopefully you’ve heard on the news that there is now a formal settlement for the 2017 data breach of Equifax. This settlement is huge, and $425 million of the settlement is earmarked for individuals affected by the breach. (Jump to the conclusion section for my recommendations)
Background
Back in 2017, Equifax had a huge data breach and around 417 million people had their personal information compromised. I hope you’ve been monitoring your credit ever since then, if you weren’t already. I have ready that every American adult should consider their information compromised, even if you haven’t formally been told it was. With this breach and all the other large breaches, chances of not being included in at least one are pretty slim.
Settlement Details
The settlement can’t ever make you whole but it does offer some protection going forward, as well as some restitution if you’ve had an identity theft event as a result of this data breach.
Free Credit monitoring and Identity Theft Protection
- You can elect to receive up to 10 years of free credit monitoring OR $125 if you decide not to enroll because you already have credit monitoring. This free credit monitoring includes the following items:
- At least 4 years of free monitoring of your credit report at all three credit bureaus and $1,000,000 of identity theft insurance.
- Up to six more years of free credit monitoring at Equifax.
I can’t find why it says “up to six more years” instead of simply saying six additional years. This second bullet is only monitoring of your Equifax credit report.
- If you were a minor in May 2017, then you’re eligible for a total of 18 years of free credit monitoring.
Cash Payments
You can receive cash payments of up to $20,000 per person for actual expenses you’ve incurred as a result of the breach. This includes
- unauthorized charges on your accounts,
- the cost of freezing and unfreezing your credit report,
- the cost of credit monitoring,
- fees you paid to professionals like an accountant or attorney,
- other fees related to the breach.
- $25 per hour for up to 20 hours that you spend dealing with the breach
But wait, there’s more. You can also get free help recovering from identity theft, even if you don’t file a claim. This is for at least seven years of identity theft restoration services.
Conclusion
One thing that concerns me about the breach in general is that your social security information was compromised. This could give someone the information that they need to file a fake tax return with your name and social security number on it. This type of tax fraud makes tax professionals like me really upset and it’s hard to fix. So, take the free credit monitoring and identity theft protection. The ONLY reason you shouldn’t take it is if you have it from somewhere else. But hey, maybe you can cancel the one you’re paying for and use this Experian provided service for free. Alternatively, keep them both. Can you really have too much identity protection these days?
Also, consider getting a cash payment for your actual expenses, if you have them.
Finally, be cautious when you follow links related to this topic. I can imagine phony websites being setup to trick people into submitting their personal information to claim the benefits of this settlement. That means sticking to the two primary websites that are setup for this process:
The Federal Trade Commission has a dedicated website with information about the settlement and links to official sites related to the data breach.
You can check to see if you were affected and to file a claim, go to the official website: https://www.equifaxbreachsettlement.com/
As usual, this is not formal tax or legal advice. If you need professional assistance in reviewing your options or deciding how to file this claim, please contact a professional.