The 50-50/90 Rule

Jalene Hahn |

Journalist and TV commentator Andy Rooney took an acerbic view of much of American life. Although he died in 2011, I wish he’d have been able to provide commentary on the Equifax data breach at the end of this week’s edition of 60 Minutes.

I’m pretty sure it would include earthy comments on the evils of big business, or maybe big government, but I imagine he’d find a way to work in one of my favorite of his definitions, the one I've borrowed for this morning’s note. According to Rooney: Anytime you have a 50-50 chance of getting something right, there's a 90% probability you'll get it wrong.

Credit reporting firm Equifax recently disclosed that a data breach ‘potentially compromised sensitive information for 143 million American consumers’. That’s about half of us, so your odds would seem to be about 50:50 of being among those whose most closely held information is now available for sale somewhere on the deep web. If someone successfully steals your credit identity, there’s at least a 90% chance that it’ll take a lot of time and effort to resolve all the outfall. Identity theft is one of those gifts that keeps on giving.

Before asking why the hack was discovered in July and their announcement didn’t occur until September, take a few minutes to go to their website and enroll in a credit freeze and the enhanced security measures they’ll be providing to anyone who asks. This is an individual issue, so partners and spouses must each check for themselves.

It’s possible that you already have some form of credit protection, perhaps through a bank or credit card issuer but, since at least the first year of fraud protection coverage will be ‘free’, I see no harm in proceeding. When their servers finally get caught-up, you’ll be emailed a PIN that must be used to un-freeze your account whenever you need to apply for new credit or insurance or sign up for a new cellphone plan. That’s going to be a 5-minute annoyance but one that’s infinitely less burdensome than undoing all the damage a hacker can do to your life. If you have any concerns about being able to manage the process, please let us help you.

The credit reporting industry is operated by for profit businesses and they have become integral to modern life. Equifax and the others who provide credit reports spend millions of dollars every year, lobbying to ensure that they can continue to operate their businesses with little oversight. Equifax’s shareholders have been rewarded for that effort with a 20% drop in the value of their shares since the breach was revealed.

I lack both Rooney’s wit and national platform but my guess is that there’s about a 90% chance that this data breach won’t be the last we’ll hear of. Please be careful in choosing the entities with whom you share your personal information.