The Common Law

Recently approved by the Texas Legislature, the ability for Texas consumers to obtain a security freeze takes effect Sept. 1. The security freeze is another weapon in the arsenal of a consumer concerned about identity theft. A security freeze means that your credit file cannot be shared with potential creditors or identity thieves. Because most businesses will not open credit accounts without checking a consumer's credit history, by freezing your credit files, there is a much better chance to prohibit an identity thief from obtaining credit in your name.

Placing a security freeze on your account is relatively straightforward. To initiate the freeze, you must write to one of the three main credit bureaus -- Equifax, Experian, or TransUnion. The letter should be sent via certified mail and must contain the following specific items: full name, address history over last five years, proof of current address (utility or phone bill), copy of government issued ID card, and $10 fee (the fee is waived if the consumer can show she has already been the victim of identity theft). For more nuts and bolts information on obtaining a security freeze, including examples of sample letters to credit bureaus, take a look at this website: www.consumersunion.org/pdf/security/securityTX.pdf.

The credit-reporting agency will send the consumer a personal-identification number (or password) that allows the consumer to have the security freeze lifted, either for a temporary period of time or a specific party. Lifting a freeze, however, can be somewhat cumbersome as it takes about three business days. For this reason, a security freeze may not be the best option for someone who knows his or her credit history will be checked on numerous occasions in the near future (i.e., applying for new credit cards, home or car loans, employment background check, etc.).

It is also important to note that certain entities can still have access to your credit file even if you have a security freeze on it. Under various circumstances, existing creditors, collection agencies, other creditors, and governmental agencies may access your credit file.

To learn more about whether a security freeze is the right option for you, take a look at the Texas Attorney General's website (www.oag.state.tx.us).