As a financial caregiver, one of your crucial duties is to shield your loved one from financial frauds and scams. From September 21, 2018, forward, a new federal regulation permits certain financial caregivers to place a security freeze, also known as a credit freeze, on the credit files of those they care for. This measure is a significant step in preventing identity theft and fraud.
Identity theft is a risk to everyone, occurring when someone’s personal details, like their Social Security number, are stolen. This information can be used by hackers, thieves, and even acquaintances to open unauthorized credit cards and other financial accounts in the victim’s name. A security freeze limits access to credit reports, thereby making it difficult for fraudsters to open new accounts under someone else’s identity. The recent law amendment now allows for a free credit freeze and unfreeze at the three major nationwide consumer reporting agencies — Equifax, Experian, and TransUnion.
The law extends a helping hand to financial caregivers managing the finances of individuals unable to do so themselves. It recognizes “protected consumers” as those incapacitated, those with a legally appointed guardian or conservator, or minors under the age of 16. To act on a protected consumer’s behalf to freeze or unfreeze their credit, caregivers must provide the credit bureaus with evidence of their legal authority, which could be a court order, a valid power of attorney, or other proof for minors under 16.
In addition to this authority, caregivers must also verify their identity through documents like a Social Security card, birth certificate, or government-issued ID.
Instructions on how to initiate a security freeze are available for those interested.
Furthermore, resources are available for those appointed to manage another adult’s finances, including guides on managing someone else’s money that outline various fiduciary roles, tips on recognizing financial exploitation, and scam avoidance strategies.
If issues arise with the placement of a security freeze by a credit bureau, complaints can be filed with the Bureau of Consumer Financial Protection. And, for those suspecting identity theft for themselves or someone they know, the Federal Trade Commission’s website offers a tailored recovery plan.
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