Feature Article
Mark Pribish
Secret consumer scores threaten privacy and increase risks for ID theft victims
By Mark Pribish
Vice President and ID Theft Practice Leader

When it comes to ID Theft and data breach, most people only think about financial ID theft and their credit scores.

According to a new report released last month by the World Privacy Forum (WPF) - a public-interest research group with a focus on privacy and the data broker industry - consumers may want to learn more about their "secret consumer scores."

Consumer scoring, while not new, has increased in size and scope due to big data and technology. At the same time, consumer scoring is "largely unregulated either by the Fair Credit Reporting Act or the Equal Credit Opportunity Act where thousands of pieces of information about consumers' pasts predict how they will behave in the future."

The WPF report continues by stating "the scores are typically secret in some way. The existence of the score itself, its uses, the underlying factors, data sources, or even the score range may be hidden. Consumer scores with secret factors, secret sources, and secret algorithms can be obnoxious, unaccountable, untrustworthy, and unauditable. Secret scores can be wrong, but no one may be able to find out that they are wrong or what the truth is."

This is important to know because "victims of identity theft may be at particular risk for harm because of inaccurate consumer scores," according to the report.

In fairness to financial institutions, retailers and other users of consumer scoring - some of these consumer reports provide benefits that can help individual consumers.

For example, the idea of individual consumer modeling, in which retailers and creditors try to identify and separate profitable customers from unprofitable customers - along with predicting purchasing patterns and customer loyalty - can help consumers save money through discounted pricing and targeted sales.

Another example is the transaction score which is used to identify fraudulent credit/debit card use based on your regular credit/debit card buying habits, including the average dollar amount of each transaction, type of transaction and transaction location. If your transaction amount, type and/or location creates a red flag like using your debit card in China, your debit card company might decline future activity until they have spoken directly with you to confirm your travel to China or your debit card is being fraudulently used.

To conclude, here are some additional examples of consumer scores:

  • Attrition risk score is a retention tool to help retain existing customers
  • Bankruptcy score that measures the likelihood of your declaring bankruptcy
  • Behavior score where good or bad behavior motivates the retailer or creditor to a specific action
  • Churn score where many companies, such as wireless carriers and cable companies, create scores that predict how likely you are to take your business to a competitor
  • Collection score determines which delinquent customer will pay off their past due amount
  • Consumer profitability score predicts how quickly you will pay your debts
  • Job security score where employment and unemployment data, economic trends and forecasts predict the probability that you will lose your job
  • Medication adherence score predicts your likelihood of following a prescription plan and your doctor's orders
  • Response model score can help a retailer anticipate purchasing patterns, enhance the customer experience, and cross-sell new products/services
  • Revenue Score can predict how much revenue and profit will be generated through each customer

Not all consumer scores are bad. Consumer scoring offers benefits to both users and consumers. But regulators like the FTC need to make consumer scores public and transparent to the consumer.


To learn more about these threats and how to protect yourself and your family from Identity Theft, you can read my past newsletters at the Merchants Identity Theft Educational Website at www.idtheftedu.com.

Scam Central

Fake Malaysian Airline Updates

Whenever a major disaster happens, such as a huge hurricane, violent tornadoes, mega-earthquakes, mud slides, etc., the world seems to become enthralled with every little piece of information there is to glean from the unfortunate event. That is especially true for the families of the victims of such tragedies. Clinging to hope, they turn to the news, social media, or whatever else they can to await news, good or bad, of their loved ones fate.

As in times past, it doesn't take long before unscrupulous identity thieves and scammers begin to take advantage of the situation, preying on both people's raw emotions and generosity towards others. Unfortunately, this is the case with the missing Malaysian airliner MH370. Scammers are bringing false hope in the form of social media posts and fake videos in efforts to steal interested news watcher's personal data.

How It Works:

According to a recent article on the Better Business Bureau's website, scammers are creating Facebook posts with titles similar to "Video of Malaysia MH370 Plane Found in Bermuda Triangle. Passengers alive." The post includes an image of an airliner in the ocean and a link to watch a video. Upon clicking the link, you are told that you need to update your video player software. When you click the link to update the video player, you download a piece of malicious software instead. Or, you may be asked to submit Personally Identifiable Information (PII) before you can watch the video. Giving up any information or downloading the malicious software will leave you open to potential identity theft.

Your Defense:

It is troubling that people would have such little respect for tragedies such as this one as to try and profit from it. This type of scam is not necessarily new however. Whenever disaster strikes, scammers go on the offensive. The best way to avoid having your PII stolen, or installing malicious software on your device is to simply realize that you cannot trust everything you read and avoid clicking on links of this nature, even if your friends on Facebook fall for the bait. For more reliable information, turn to newspapers and the television instead.

Here are additional steps recommended by the Better Business Bureau that you can use to help steer clear of this type of scam:

  • Stay away from promotions of "exclusive," "shocking" or "sensational" footage
  • Hover over links to see the true destinations and do not click if the URL is an unfamiliar or foreign website
  • Don't trust your friends tastes online as they may have been hacked already or tricked into "liking" or sharing an article, perhaps without knowing
  • Use common sense

If you suspect that a posting or Tweet you see on Facebook or Twitter is malicious, or at the very least suspicious, report it as spam immediately. The quicker you can get these types of posts removed, the safer everyone will be. While social media can be a great source of information when used appropriately, don't trust everything your friends post or share.

If you believe your identity has been stolen, call 866.SMART68 today.