Monday, June 04, 2007

Is LifeLock an identity theft protection service people can trust?

Ray Stern, of the New Phoenix Times, published a scary story about an identity theft protection service, called “LifeLock.”

The article suggested that LifeLock was founded on stories that are questionable, and run by a Robert Maynard Jr., who seems to have a few skeletons hiding in his closet.

Not all identity theft services are 100 percent effective, or worth the money they charge (my opinion). Many require their customers to surrender all the same personal information a criminal might use, which will be stored in a database.

Databases are targeted by common thieves, hackers, and even dishonest insiders for their personal and financial information. Even if the information is protected, all it takes is one person with access, or who is tricked into giving up their access to compromise it.

Besides being stolen, information from data bases is bought and sold, frequently. It's a billion dollar business, itself.

Another problem is that even the best computer security can be compromised and has to be updated, frequently. Even encryption can be compromised by someone, who has the time and necessary knowledge to do so.

Many of these services require that their customers provide them with a power of attorney. Couple a person’s complete personal and financial information with a power of attorney – and a lot of subsequent damage can occur.

A lot of people are trying to make money off the current identity theft phenomenon. When choosing any service the term, "caveat emptor," or "buyer beware," certainly applies.

Robert Maynard Jr. is a person making a lot of money from the identity theft phenomenon, but should people trust his service? Before coming up with LifeLock, he was banned from ever working in the credit industry. Here is what the New Phoenix Times article said about this:

His credit-repair company was shut down by authorities in the early 1990s for false advertising and deceptive practices. Forced closure means that a federal court order has banned Maynard from working in the credit-repair industry — forever.

The FTC judgement against Maynard and his business partners can be read, here.

Maynard is fond of telling a story, where he was the victim of identity theft. He claims this experience gave him the inspiration to start LifeLock. BUT the story of how someone else used his identity to take out a $16,000.00 marker at a casino isn’t very credible.

The New Times interviewed Bernie Zadrowski of the Clark County District Attorney’s Office about this story.

Here is what they quoted Mr. Zadrowski as saying, which is a lot different from the story Robert Maynard Jr. uses to sell his identity theft service:

Not once did anybody ever suggest, in this particular case, that this was a case of stolen identity," he says.

Maynard never filed a police report for identity theft, or it would be part of the D.A.'s office file, Zadrowski says.

"The only call we received while he was in jail was from his girlfriend. She wanted to know how to get him out of jail," he says.

Zadrowski pulled the Arizona driver's license submitted to the casino by the person who took out the loan and e-mailed a copy to New Times.

Although the resolution quality is poor, the man in the picture looks like Maynard.

Zadrowski says the man pictured is Maynard.

There is also the matter of an American Express Card, taken out in Robert Maynard’s father’s name (Robert Maynard Sr.), but sent to a previous business address of Robert Jr., himself.

Here is what the New Times article has to say about this matter:

Records show that someone with Maynard Sr.'s personal information ordered the card. But that someone didn't have the bills sent to Maynard Sr.'s home. Instead, the bills went to a company called Netshield, at a Phoenix address used by one of Maynard Jr.'s former firms.

Though Maynard Sr. says he never asked for the card, he settled with the company. Coincidentally, Maynard Jr. has $170,000 in debt to American Express listed on his 2005 bankruptcy paperwork — and his father is named as a co-debtor.

If Maynard Jr. ordered the card using his dad's data, without his dad's knowledge, that would make him — you got it — an identity thief.

Apparently, Maynard has been able to sell his victim story numerous times to the mainstream media and pays bloggers to write about him.

During one attempt by the New Times to interview him, Maynard backed out at the last minute, claiming he had to meet with shock jock Howard Stern to discuss advertising. Maynard does take out advertising on Stern's show, among others, but Ray Stern (New Times) noted that his office appeared to have been vacated minutes earlier.

To date, there have been no complaints of wrongdoing at LifeLock, but if you read the New Times article, it would make someone like me think "long and hard" before handing over my money and information to them.

There are a lot of identity theft services out there. Most of them including LifeLock offer services that most of us could do by ourselves, if we had the knowledge.

Simply stated, the reason identity theft gets worse all the time -- is because of too much information is being bought and sold -- then maintained in too many (some not very secure) different places. The more places your information is stored, the more likely you are to become a victim.

New Times article, here.


Anonymous said...

These guys are as much of a scam as identity thieves themselves. A half hour on the phone with their member services department proved that to me. I had my info stolen and someone fraudulently signed up a LifeLock account in my name (ironic, no?). These guys wouldn't lift a finger to help me out, it was obvious that they could care less, they got their money and were happy.

Everyone, just so you know, all they do is sign up for that 90 credit fraud alert for you every 90 days. They sign you up with their phone number and then call you if they get a call. Guess what? You can just sign up your own phone number and get the exact same service for free. Just add a recurring event to your Google Calendar to fill out the online form quarterly and you're done. Not only is this cheaper, but you don't have to give all of your confidential info (e.g. SSN) to a bunch of scammers (e.g. LifeLock).

Anonymous said...

The same thing happened to me. I asked LifeLock for the name of the person who opened the account and they said they could not provide it. They did let me close the account, and sent a letter titled "Important LifeLock Identity Theft Protection Membership Notification" to a "Michael Schneider" at my address.

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