Sign up for free credit monitoring

Cindy Lupica last week signed up every member of her family to participate in a class-action settlement with TransUnion Corp., one of the three major credit bureaus.

The settlement will give each member of her household -- possibly even 12-year-old Gregory -- nine months of a free credit-monitoring service.

Last week was the first week you could register for the settlement, and Lupica, a lawyer in La Cañada Flintridge, wasn't wasting any time. Her 16-year-old son was recently the victim of an attempted identity theft. The settlement gives her a free and easy way to find out whether anyone else's credit file has been compromised.

"Given my limited time to research, I thought this would be the easiest way to check," she said.

As an added benefit, Lupica and her husband and children will be able to learn their credit scores. They also can check at any time during the nine months of monitoring to see how those scores have changed.

An estimated 160 million Americans qualify for free credit monitoring under the settlement. Should you sign up? There's almost no reason not to.

The settlement was reached last month to resolve a lawsuit accusing TransUnion of illegally breaching consumers' privacy by selling their credit information to marketers. TransUnion said it didn't violate the law but agreed to pay $75 million in cash and provide free services that retail for $9 to $15 a month.

Anyone who had an open credit account -- a credit card, a mortgage, an auto loan or any other debt reported to the credit bureaus -- at any time between January 1987 and 24 days ago, May 28 -- can participate. That means most adults.

But signing up the children, as Lupica did, is a good idea because it will tell you whether someone has opened an account in their name. A child who doesn't have a credit file will be rejected from the settlement -- information that may prove comforting.

Lupica's experience with her 16-year-old shows that it never hurts to check.

When you sign up for the settlement, you can choose one of four options:

* A potential cash payment of an undetermined amount to be paid in two years.

* Six months of free credit monitoring.

* Six months of free credit monitoring, plus the right to the cash payment.

* Nine months of enhanced credit monitoring without the possibility of a cash payment.

Lupica chose the nine-month deal on the advice of a friend, who figured the chance of getting a significant amount of money out of the settlement was remote.

There's no official projection of how large the cash payments would be. They will come from the $75 million being put up by TransUnion, but that money will first pay attorneys fees and settlement costs.

If we assume that, say, half of the $75 million is used to pay fees and costs and that only 10% of those who could qualify for the settlement opt for the cash, each of those people would get less than $2.50.

As for the credit monitoring service, having access to your credit score is a nice bonus even though TransUnion is likely to provide a credit score it calculates, not the more widely used FICO score developed by Fair Isaac Corp.

But John R. Ulzheimer, president of Credit.com Educational Services in Atlanta and the author of "You're Nothing but a Number," says TransUnion scores and FICO scores are very similar, even if the numbers are different.