Account Freeze

Very similar to a credit freeze, an account freeze will put a stop to the use of your existing accounts. While a credit freeze prevents the credit reporting agencies to share your credit reports with third parties for the purposes of credit granting decisions and establishments of new accounts, an account freeze temporarily freezes any usage of your existing accounts. Placing a freeze on your existing accounts is a very good idea for two various situations; when you travel for an extended period of time and when you plan not to use an account like a credit card account for a while. In most cases, you can call the company and place a freeze on your account and even save money. For example, if you place a freeze on your phone account to stop any usage of the phone while you’re out of the country, you will probably not incur the usual monthly fees, depending on the quality of your phone company’s customer service.

I realize an account freeze is not currently a common practice, especially when it comes to identity theft prevention. A friend of mine had a freeze placed on his credit card account because a customer service representative had placed a travel notice on his account by accident, which got my attention. I think this is a great and free tool to prevent identity theft on your existing accounts. For example, in my identity KAOS™ management system, I recommend limiting the number of your credit cards and I usually suggest having only two credit cards, one for daily use and another for emergency. In this case, you could freeze the emergency credit card account for as long as you don’t plan to use it and lift the freeze in case of emergency. In all cases, it’s a quick process to place and lift an account freeze.

Some of the accounts to consider freezing for a period of time include accounts, which you do not use frequently such as your emergency credit card and your home equity line of credit. Particularly, the risks of a home equity line of credit account takeover in an identity theft case are very high. First, because these accounts have typically a very high line of credit, second, they’re tied to your home and creditors can just get their money back by selling your house for which you have worked so hard to pay off, and third, you are fully responsible for the amounts withdrawn and as I stated, the banks will not hesitate to sell your house to get their money back.

So, read and understand the identity KAOS™ management system, reduce and limit the number of credit accounts, and place a freeze on the accounts you do not frequently use.

Read about other prevention tools besides an account freeze.