Countrywide offering free credit monitoring to data theft victims

Loan customers whose personal financial information was allegedly stolen during a security breach at Countrywide Financial Corp. have several options to protect themselves against financial fraud.

Last month, a Countrywide employee was arrested and accused of stealing names, Social Security numbers and sensitive financial information from the company's computers. The information came from loan applications filed by people applying for mortgages, as well as from homeowners who have loans with the California-based lender.

Countrywide sold about 80,000 mortgages in Washington over the past two years. The firm would not say how many customers were affected by the security breach, but the Los Angeles Times quoted the FBI as saying it could be as many as 2 million nationwide.

The Los Angeles Times said the information was allegedly sold to other creditors as mortgage leads.

Countrywide is offering two years of free credit monitoring to consumers affected by the breach. The service runs daily checks on credit files at the nation's three major credit-reporting agencies, and it sends an alert when it detects a new account or credit inquiry.

Washington consumers, some of whom began receiving letters from Countrywide last week, can go one step further and freeze their credit files to make it difficult — but not impossible — for anyone to open a new account under their name. The state's "credit freeze" law allows consumers to block the nation's three biggest credit-reporting agencies from sharing their credit histories with potential creditors, who typically run credit checks before opening new accounts.

Credit freezes are free for people age 65 and older, and for those who have been the victim of financial fraud that has been reported to police. Everyone else can expect to pay $10 to each of the credit bureaus, although the rules are different for each one, and you'd do well to check online: www.atg.wa.gov/freezecharts.aspx.

Washington state law allows consumers to temporarily "thaw" the freezes to open a new account, or to apply for a mortgage or an insurance policy. There is usually a $10 charge to thaw the account, and the consumer can determine how long to keep the thaw open, according to Kristin Alexander, spokeswoman for the state Attorney General's office.

Consumers also can place an extended fraud alert in their credit files at all three agencies. The alert, which will remain in a consumer's file for seven years, warns potential creditors that the person applying for the credit may be using stolen information.

The three nationwide agencies — Equifax, Experian and TransUnion — are required to provide free credit reports to consumers once a year, so consumers can see if any unauthorized accounts have been opened. To obtain the free reports, call 1-877-322-8228 or go online: www.annualcreditreport.com.

For additional information, go to the state attorney general's office at: www.atg.wa.gov/ConsumerIssues/ID-Privacy/SecurityFreeze.aspx.

Susan Kelleher: skelleher@seattletimes.com or 206-464-2508.