Not so long a go we saw several Lifelock problems come to light but the truth is the company never broke stride and continued to grow, now having over a million customers.
Lifelock continues to be the leader in identity theft security despite a few new companies waiting in the shadows to take over should the Lifelock problems have proved to be critical.
Back in May we had the news of several clients taking class action lawsuits against Lifelock because they claimed their advertising campaign was misleading.
The claim was based on the fact that Todd Davis gives out his social security number in Life Lock advertisements to show how confident he is in the identity theft prevention provided by Lifelock. It appears they felt, or at least their lawyer felt that this is misleading because actually someone managed to take out a cash loan for $500 using the social security number of Todd Davis.
This made the news and why wouldn’t it, it’s a great story but then as the story ran it was shown that actually Lifelock had worked for Davis. The person who took out the loan was caught and more importantly, the CEO’s credit file remained perfect.
We also found out that none of the clients who were seeking the class action had actually suffered a case of identity theft and had not even cancelled their Lifelock membership. The story quickly got buried once it became clear the person behind it was a opportunist lawyer who’d found a new fat cow to chase.
The next Lifelock problems appeared to be a little more serious. Experian, one of the major credit bureaus were reporting that the service provided by Lifelock could be done by a person without the need of a monthly charge.
Lifelock, acting on a customers behalf, place a fraud alert on their credit file which means extra care should be taken when agreeing loans, credit agreements etc. Basically it means the person is concerned their identity could have been compromised so please act with caution before opening a line of credit. Incidentally, the person who took out the $500 payday loan in Davis name was successful because the company handling the loan admitted to ignoring the fraud alert.
Experian claim you can add this fraud alert yourself so Lifelock are taking monthly subscriptions under false pretenses. This appeared like serious Lifelock problems and once more the press jumped in feet first.
A little bit of digging by a few journalists who prefer to report news rather than just a good story again showed that what appeared to be Lifelock problems, more than likely had an ulterior motive.
It seems Experian do not like fraud alerts on a person’s credit file. They slow down the the business of issuing credit and creates work for them. It’s for this reason that a fraud alert only lasts for a period of 3 months. 4 times a year you have to go through the whole process of applying for it again.
Lifelock take care of all this for their clients each quarter and should something go wrong and an identity gets stolen, they guarantee to make good up to the tune of a cool $1 million and it’s this that their clients are happy to pay the ten buck fee for.
One other reason Lifelock are not the favorite company of Experian is because Lifelock remove their clients names from mail lists. The Lifelock logic is that if you aren’t receiving credit card offers through the mail, they can’t be stolen and accepted in your name without your knowledge.
It sounds a good idea right? Well guess who sells the credit card companies the names of affluent middle class Americans who the credit card companies want to target? This is a huge business for the Experian and the other 2 credit bureaus as these lists are extremely targeted and therefore worth a lot of money. Just consider sending out your credit card or loan offer to homes you already know have several cards and an income of $60K a year instead of merely posting to the masses and hoping for the best?
As with many new highly successful companies, deeper motives can usually be found when stories start appearing in the papers and the Lifelock problems are no different
If you were thinking about teaming up with Lifelock, make your decision based purely on the service offered, not on the Lifelock problems that you may have heard about a few months back.
It’s worth remembering that yes you can do what Lifelock does yourself. You could probably also service your car yourself if you wanted to and some people do. Others though prefer the security that comes with the knowledge that a professional has done it for them and should they mess up, there is a full guarantee on offer as a back up.
