Many states are embracing the credit freeze as a way for people to protect themselves from identity theft. This time Ohio is joining the states that allow residents to freeze their credit beginning Labor Day 2008. For $5 per credit bureau, Ohio residents can purchase a credit freeze to keep their credit reports from being viewed without them making the reports available by "thawing" them.
While no method of identity theft protection is completely fool proof, a credit freeze is definitely a helpful tool in protecting yourself from financial ID theft. What the credit freeze does is locks your credit report from anyone trying to extend credit to you. No potential creditor can view you credit report without you "thawing" it for them (something you would do if you apply for a loan or a credit card). So if an identity thief applies for credit in your name, he or she will be turned down since the company will not be able to view your credit report.
What can a credit freeze not prevent? As I said, there is no perfect identity theft prevention service. It doesn't protect your existing accounts. Current bank and credit card accounts will still need to be reviewed carefully and regularly. Also, some service accounts can be opened without a credit check, like phone and other utilities. Finally, it won't prevent unauthorized use of medical insurance (medical identity theft) or someone giving your name during an arrest (criminal identity theft).
Yes, it's limited, but unlike many so-called identity theft protection services, a credit freeze can actually protect you rather than just monitor your credit and alert you to unauthorized activity. I don't usually don't encourage people to purchase services, but for Ohio residents, this could be the best $15 you spend in a while.
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