LifeLock Identity Theft Protection program under the scanner
The last few weeks has seen the company’s name being surrounded by whispers of scam. Its competitors, other identity theft protection companies, have chosen the moment to play up lack of real value in its offerings.
Meanwhile, a class suit has been filed against Life Lock charging that service it provides cannot really be called an identity theft protection service. That the primary value of the service is limited to posting fraud alerts to the three credit bureaus. Interestingly, one of these bureaus, Experian, is among the complainants.
The LifeLock Offer
The company sells its services as a subscription at $10 a month. The service includes placing fraud alerts every 90 days on the customer file at credit bureaus, taking customer’s name off the mailing lists of junk mailers and sending them yearly credit reports. Placing a fraud alert disables new accounts from opening against the customer name.
All these can be done without a fee if one wants to. But customers of the company are happy paying the $10 monthly fee. They feel it saves them time and energy otherwise lost while getting the same thing done personally through the bureaus.
Law suits allege LifeLock service is illegal and over hyped
The service is sold through ads featuring CEO of the company, Richard ‘Todd’ Davis, boldly displaying his Social Security Card, daring thieves to steal his identity.
- The suit alleges the service is so poor it was not able to prevent identity theft of the CEO from happening.
A thief, it claims, took out a $500 payday loan with his identity using his social security number, name and his wife’s mobile number. The thief was later caught and his confession taped on camera but this did not prevent serious questions being raised about the quality of the service. The company fended off bad press saying attack was made possible because the loan was not referred to the credit bureaus before approval.
The advertisements also promise subscribers up to $1 Million to cover losses if their identities are stolen during the subscription period.
- The suits allege this cover is useless.
Riders and fine print inside the offer limit the cover only to losses arising from use of the service and towards fees for appointing third parties to recover lost amounts.
The complaints were also directed against its practice of placing fraud alerts for its customers.
- The suits claim the practice is illegal.
As such, only individuals or other individuals acting on their behalf are entitled to do this. Corporations cannot do this on behalf of its clients, the suits argue.
Most customers of the company seem to be a happy lot. LifeLock claims it has received complaints of identity thefts from only 71 of its 870,000 customers! Customers generally did not mind the $10 dollars they had to shell out for an otherwise free service.
This post at TechCrunch turns the allegations on its head. Please do read the entire post.
Is there more to this than meets the eye?
I wonder if your answer, too, is yes!
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October 11th, 2010 at 11:10 pm
once you consider the scenario via a microscopic lense it does not look nice, when it is inside perspective difficulty