MoneyWi$e webinars teach about credit and identity theft

Two informative web-based trainings developed by Consumer Action under its Moneywi$e financial literacy partnership sponsored by Capital One recently provided community-based organizations with the tools to help clients and members stay up-to-date on the latest advancements in credit reporting and the many guises of the fast-growing crime of identity theft.

Rod Griffin, director of public education at Experian, joined Consumer Action’s Nelson Santiago and Audrey Perrott last month for the credit discussion. Consumer Action trainer Linda Williams led the identity theft webinar.

The credit reporting landscape

The credit webinar kicked off with a presentation by Santiago about the three major credit reporting agencies (CRAs): Equifax, Experian and TransUnion. He covered what these CRAs, report and how consumers can get free credit reports each year from AnnualCreditReport.com.

The audience of 69 community-based organizations was shown a sample credit report that they might use to help consumers understand how to interpret their own reports.

Santiago explained the importance of having good credit, from the more obvious reasons, like buying a home or refinancing an automobile, to the perhaps less obvious ones, like qualifying for auto insurance or getting a job (employers are checking credit reports more often before hiring, a practice that many consumer advocates oppose). Nelson used some startling examples to argue the need for good credit, stating that “someone with poor credit might end up paying two to four times more for auto insurance. A recent Consumer Reports article revealed that a poor credit score could do even more harm to your insurance rates then driving under the influence!”

Santiago cautioned those with poor credit (or no credit history) to avoid the pitfalls of credit repair scams. In order to establish better credit, he advised going to a local company for a small loan, using a co-signer with established credit or getting a secured credit card. Nelson added that consumers must make sure to pay all bills promptly, as late payments on credit cards and loans hurt your score.

Griffin then spoke about Experian’s new website, which makes it easier for consumers to order a credit report, report identity theft or dispute an error online. He also talked about new developments in credit reporting. For instance, if consumers pay off their collections accounts, those accounts will no longer be included in their credit score. (Unpaid collections debt is still included, but this is a big step up from the days when paid collections debt could wreak havoc on your score.)

Finally, Griffin outlined the top factors that contribute to stellar, mediocre or poor credit. He said Experian conducted a survey that found that people with excellent credit have what’s known as low “utilization” (i.e., they have a low total outstanding balance compared to their total credit limit), made payments on time and kept their credit lines open longer then those with poor credit. We’ll be posting this webinar on our YouTube page in the near future and will let you know when it’s available.

For more information, check out Consumer Action’s handy guides to building and keeping good credit and improving your credit.

Identity theft

Sixty community educators, counselors and advocates from 27 states tuned in for the MoneyWi$e Changing Faces of Identity Theft webinar.

Consumer Action trainer Linda Williams, who led the webinar, spoke about how identity (ID) theft occurs and addressed its impact on consumers. Also offered were resources to help with prevention, detection and cleanup. In order to better educate participants, Williams used the MoneyWi$e ID Theft & Account Fraud module and five easy-to-print ID theft fact sheets developed by Consumer Action’s outreach and training team.

According to a Javelin Strategy report, identity thieves stole $16 billion from 12.7 million Americans in 2014. New victims appear every two seconds.

Williams discussed the many “faces” of ID theft: medical ID theft, child ID theft, criminal ID theft and “true name” ID theft. True name fraud occurs when an identity thief uses a victim's personal information to open new accounts. Also discussed were practices like “ghosting” (taking on the identity of a deceased person) and synthetic ID theft (when thieves create new identities either by combining real and fake identifying information to establish new accounts with fictional identities or by creating a brand new identity from fake or inaccurate information).

Five interactive polls were conducted during the webinar to gauge participants’ knowledge about identity theft. Viewers responded “true” or “false” to statements such as “Criminal ID theft is a non-credit identity theft crime.” The challenging exercise encouraged participants to confront any misperceptions and deeply analyze the complicated nature of ID theft.

In order to combat ID theft, Consumer Action recommends that consumers not use the same password for all accounts; change passwords every six months; cover their hand when entering PIN number at the ATM; choose and use apps wisely; monitor mail; check bank statements regularly; and check their credit and specialty reports. As the event wrapped up, several resources were provided to help consumers prevent, detect and clean up identity theft.

Feedback from the event was overwhelmingly positive, with webinar participant Jennifer Ford-Cooper exclaiming, “This was a phenomenal and interactive webinar! The best I’ve attended thus far!”

A complete list of additional non-profit and government resources is available for download in Consumer Action’s MoneyWi$e ID Theft & Account Fraud PowerPoint training slides.

The ID theft event marked the third MoneyWi$e webinar co-hosted by Consumer Action and Capital One this year. Past webinars may be viewed on Consumer Action’s YouTube channel. For more information on the MoneyWi$e project, click here.