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New law allows consumers to freeze credit files

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A recent federal law makes it easier for consumers to protect their financial security by freezing their accounts with all three major credit agencies for free.

Prior to this law coming into effect on Sept. 21, individuals could freeze and unfreeze their accounts, but those actions required paying a fee each time, according to Bruce Carlstrom, president of Lake City Federal Bank.

That meant paying the fee to all three credit agencies—Equifax, Experian, and TransUnion—because " it doesn't do any good to freeze it on one," Carlstrom said. "You need to freeze it on all three."

Now freezing and unfreezing a credit file with all three agencies is free to anyone.

One drawback to freezing a credit file is "you have to remember to unfreeze it if you want to apply for credit," said Jeff Johnson, president and CEO of First National Bank of River Falls. "It is one of those things that you do, and then you forget about it. Then when you need it, you have to remember to go back and unfreeze it."

An example of how a credit freeze could help, would be if "somebody has stolen your credit which happens on a daily basis many times throughout our country," Johnson said. "They have your driver's license information. They have your social security information and your address and they try to take out a loan or buy a car in your name. If if you have a freeze on your credit file, the credit agency will recognize that and they won't be able to take out a loan."

How to ...

Freezing or unfreezing a credit file may be done by mail, phone, or online, according to the Minnesota Department of Commerce. They list the following websites and phone numbers as the locations to set up a credit file freeze:

When a consumer establishes a credit freeze, each agency issues a PIN number to allow the consumer to temporarily unfreeze the account while applying for new credit, according to the Minnesota Department of Commerce.

The MDOC also noted that a parent may apply for a credit freeze with each agency for a child under the age of 16.

Using the new free credit freeze "is a good thing, but it does mean you have to do some work," Carlstrom said. "I can also say it is a good thing to watch your bank accounts regularly, but that means you need to make an effort to log in and look at your bank accounts. You have to be proactive to watch out for yourself these days."

Johnson agreed that the credit freeze is a good idea, "especially with the amount of fraud that we continue to see on a daily basis. Overall, fraud and cyber criminals have increased our cost of doing business exponentially over the last five-plus years."

Every consumer is entitled to one free credit report per year from each agency. Johnson said it is a good idea to take advantage of that, as well as continually monitor credit card activity and bank account statements.

"We try really hard here to push mobile banking where you have an app on your phone and you can look at your bank account," Johnson said. "One of the reasons we push that is so that people can monitor the debits that take place on a daily basis to be sure that they are theirs, that they are not fraudulent things."

While the credit freeze may be helpful, Johnson said the general public might not be aware of this opportunity.

"The issue now is just getting the word out about it.," he said. "We need to educate people more."

Cyber security seminars

He plans to help with education by offering two cyber security seminars. The first is Oct. 24 at First National Bank in River Falls at 104 E. Locust St., and the second is Oct. 25 at the First National Bank at 1151 Canton St. in Prescott. The seminars will be the same at both locations and will be held from 11 a.m. to 1 p.m.

The seminars are free and open to anyone. Interested persons may RSVP by calling the bank at 715-425-2401, although registration is not required.

Johnson hopes that people who attend "can learn how to protect themselves against the bad guys."

The credit file freeze "is another tool that the average person can keep in their toolbox and utilize if they need to," Johnson said. "I think only good can come out of that."

Steve Gardiner

Steve Gardiner taught high school English and journalism for 38 years in Montana and Wyoming.  He started working at the Republican Eagle in May 2018.  He focuses on features and outdoor stories.  

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