Wells Fargo pushes three services nobody should buy

Wells Fargo sign

I am in the process of switching banks, which means I still get marketing mail from Wells Fargo.

One recent mailer tried to sell me three services that no one should really pay for: access to credit reports, a credit protection program and an educational credit score.

The letter starts off by saying that "as a Wells Fargo customer, you are eligible to review your free credit report from the three major credit reporting agencies by trying the Enhanced Identity Theft Protection Service."

That's partly true.

Yes, I am entitled to see my credit reports from the three credit bureaus once a year. But I don't have to enroll in a fee-based "protection service" to do so.

All I have to do is go to AnnualCreditReport.com.

(Let's give Wells Fargo some credit: The letter does say you can get your reports for free at AnnualCreditReport.com. But it tries to hide or at least minimize this admission by placing it in a small box at the top of the letter).

Now to the purpose of the letter: Wells wants me to buy its Enhanced Identity Theft Protection Service for $15.99 a month. (The first month is free. Yippee.)

Unfortunately these services don't really protect you from identity theft, says Liz Weston, author of Your Credit Score, now in its fourth edition.

"It's protection if an ice pack is protection," she says.

An ice pack won't prevent you from getting punched in the nose, but it will keep the swelling down after it happens.

In the same way, these kinds of protection plans can't stop the theft from happening -- they just let you know sooner by alerting you to changes on your reports.

Still, you don't need to pay for it, says Weston.

You can get free credit monitoring through CreditKarma.com.

Even if you've had your identity compromised, signing up for one of these services still isn't the best move you can make.

"If you've already been the victim of new-account fraud or someone has stolen your Social Security number, then I would go for a credit freeze instead of credit monitoring," Weston says.

You can do that by calling each of the three major credit bureaus -- Equifax, Experian and Transunion -- and have them freeze your credit.

That makes it impossible for banks or retailers to obtain copies of your credit report.

Without a credit report, lenders won't issue a credit card in your name. (A PIN allows you to temporarily lift the freeze so a legitimate credit application can be processed.)

Consumers Union, the nonprofit publisher of Consumer Reports magazine, has created an online guide that provides state-by-state instructions on how to use these laws.

Many state laws provide for free security freezes, but if you have to pay a fee, it's pretty cheap.

I found prices ranged from free to $5, depending on the state, on each of the credit bureau websites.

A freeze does not prevent theft from an existing bank or credit account, but it is the only way to block that punch to the nose when the fight's already been picked by a thief.

Now, about that credit score.

According to the letter, if I signed up for this identity theft service, I'd also get my CreditXpert score.

This is not my FICO score, which is the one that 90% of banks and lenders look at if I wanted to take out a loan or open a credit card. (So-called educational credit scores you may find online are not used in lending decisions.)

So why would I pay for access?

And besides, most people don't need regular updates on their credit score, says Weston, though she adds that if you are rebuilding your credit and want to monitor your progress, only sign up for updates through MyFICO.com.

Not only will that service give you your numbers from all three reporting bureaus, but it will show you the only number that matters: your FICO.

Monthly updates cost $19.95 a month. Quarterly are $4.95 a month.

So if you're a Wells customer and got this letter, too, shred and recycle.

That's about all it's good for.

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