The low credit freeze utilization rate shows a lack of understanding of the role freezes play in preventing the misuse of stolen personal information
SAN DIEGO, December 15, 2021 – Today, the Identity Theft Resource Center® (ITRC), a nationally recognized nonprofit organization established to support victims of identity crime, published research conducted by DIG.Works that explored the relationship between data breach notices and a decision for a consumer to freeze their credit, as well as credit freezes in general.
The ITRC and DIG.Works surveyed 1,050 U.S. adult consumers on the topic and discovered that most consumers are familiar with the credit freeze process. However, there is a disconnect between awareness of credit freezes and how often consumers use them to protect their or their family’s identities.
- More than three-fourths of consumers responding to the survey said they were familiar with the credit freeze process.
- Fewer than one-third of overall survey respondents had frozen their credit at one time for any reason; only three (3) percent of consumers froze their credit after receiving a data breach notice.
- Confusion and incorrect information about the process, cost and impact on credit scores caused a significant number of consumers to avoid freezing their credit. Eleven (11) percent of respondents have never placed a credit freeze because they incorrectly believe it will impact their credit score or require payment to freeze or thaw. However, most respondents did not freeze their credit because they didn’t think they needed to do so.
- One-third of respondents said they did not believe it was necessary to freeze their children’s credit to prevent identity misuse; a slightly larger number reported freezing their children’s credit.
“The vast majority of people know what a credit freeze is but do not take advantage of this valuable resource,” said Eva Velasquez, President and CEO of the Identity Theft Resource Center. “A credit freeze is generally considered the most effective tool to prevent new accounts from being opened in your name. This research shows that there needs to be improved awareness and utilization of credit freezes, particularly for minor children. ITRC expert advisors are always available to walk people through the steps of how to place a credit freeze and the advantages of doing so.”
Based on the research, the ITRC believes the following should be done to address these findings:
- Data breach notices issued under state laws and federal regulations should include an explicit recommendation for victims to freeze their credit as soon as possible, regardless of the type of data compromised in a breach.
- Data breach notices should include information that clarifies that credit monitoring alone cannot prevent a new account from being created.
- Businesses, victim advocates and government representatives should collaborate on a comprehensive education plan to improve awareness and utilization rates of credit freezes. A special emphasis should be placed on the benefits of freezing a minor’s credit.
- The consumer reporting industry should improve the ease of operation of credit freeze and thaw requests, especially for minor children. This includes creating a common system where consumers can freeze or thaw their credit without contacting each Credit Reporting Agency (CRA).
Consumers can receive free live victim support or guidance from a knowledgeable advisor on how to place a credit freeze by calling 888.400.5530 or visiting idtheftcenter.org to live chat. Consumers can visit FrozenPii.org to freeze their credit.
About this Survey
The ITRC thanks Jonathon Sasse and Anders Steele for their donation of this research project on behalf of the ITRC and identity crime victims. Please visit DIG.Works to learn more.
About the Identity Theft Resource Center
Founded in 1999, the Identity Theft Resource Center® (ITRC) is a national nonprofit organization established to empower and guide consumers, victims, business and government to minimize risk and mitigate the impact of identity compromise and crime. Through public and private support, the ITRC provides no-cost victim assistance and consumer education through its website live-chat idtheftcenter.org and toll-free phone number 888.400.5530. The ITRC also equips consumers and businesses with information about recent data breaches through its data breach tracking tool, notified. The ITRC offers help to specific populations, including the deaf/hard of hearing and blind/low vision communities.
Identity Theft Resource Center
Head of Earned & Owned Media Relations
888.400.5530 Ext. 3611