We shred our documents, monitor our bank accounts and exercise caution when disclosing our personal information. But many of us still fall victim to some form of identity theft.
According to a report issued by the Bureau of Justice Statistics in November 2011, 7 percent of households in the United States, or about 8.6 million households, had at least one member age 12 or older who became a victim of one or more types of identity theft in 2010.
LifeLock, a company headquartered in Tempe, Ariz., has battled identity theft since CEO Todd Davis founded it in April 2005.
Davis started the company because he frequently saw news articles about identity theft and how it could cost “hundreds of hours and thousands of dollars” for a victim to clean up the mess.
“The solution was always the same,” he said. “You should be really careful who you give your information to. Well, I think that’s just ludicrous.”
Davis enlisted the help of technologists to develop a proactive solution that would make it difficult for criminals to turn a victim’s personal information into money since we are expected to give our information to employers, doctors’ offices and many other organizations.
They developed the LifeLock software, which offers identity theft protection to individuals through a five-point model: monitoring your identity, scanning for identity threats, responding to identity theft, tracking your credit score and offering a service guarantee.
LifeLock promises its members that if they become victims of identity theft due to a failure in the company’s service, it will spend up to $1 million to hire experts, lawyers, investigators, consultants and “whatever else it takes to help your recovery.”
Davis said LifeLock has followed through with the guarantee for more than 2,000 customers because “no one can stop all identity theft.” He added that they are some of LifeLock’s most satisfied clients.
LifeLock also offers services to businesses such as data breach control, and it recently acquired ID Analytics Inc., a San Diego-based company that provides the credit industry with identity theft risk assessment data.
While LifeLock monitors for new accounts opened in its customers’ names and for changes to their personal information on existing accounts, it cannot monitor transactions on existing accounts – the most common type of identity theft – as only banks can access that information.
Davis said he chose Arizona for the company’s headquarters because of the “phenomenal talent pool,” low cost of living and “great innovation” that’s based here.
When the company was founded, Arizona was ranked No. 1 in the nation for identity theft complaints. It held the ranking for five consecutive years, from 2003 to 2008, according to reports issued by the Federal Trade Commission.
In a report released by the FTC in February, Arizona was ranked fourth in the US for identity theft in 2011, with 98.5 complaints per 100,000 people, and 6,296 total reported complaints.
Davis said some of the reasons for the ranking include Arizona’s proximity to the border, the implementation of laws such as E-Verify and the large senior population which he has noticed is susceptible to phone scams.
E-Verify requires prospective employees to have valid social security numbers and Davis said this may trigger them to steal those numbers instead of fabricating them.
Davis himself has been a victim at least 13 times, the Phoenix New Times reported in 2010. All incidents were reported after he launched the company.
The CEO had prominently displayed his social security number on the company’s website and advertisements to show his confidence in LifeLock’s services.
This information leaked shortly after the FTC accused the company of deceptive business practices and failing to secure sensitive customer data. LifeLock agreed to pay $12 million to settle the charges.
More about LifeLock
# of employees: 600+
Revenues: $217 million in 2011
Founder: Todd Davis
Blog: Not available
Phone #: 1-800-543-3562
Headquarters: 60 East Rio Salado Parkway, Suite 400 • Tempe, AZ • USA