Untitled Document
What’s New
In March, the U.S. House Financial Services Committee approved legislation, HR 3997, that would overturn dozens of strong state laws giving consumer protection against identity theft without substituting meaningful federal reforms. In the last year, sixteen states have passed laws giving consumers the right to freeze access to their credit reports, stopping identity theft before it starts. Twenty-three states have given consumers the right to be notified when a company, like Choicepoint, or a government agency loses their confidential financial DNA.
How You Can Help
Please take a moment to tell your representative to pass stronger laws that protect identity theft without preventing states from passing even stronger protections.
Summary
Just since February 2005, banks, Choicepoint, Bank of America, DSW Shoe Warehouse, Cardsystems and other companies and agencies have disclosed that they’ve lost the confidential financial information of over 53 million Americans. We learned about these security breaches only due to a pioneering California notice breach law that companies complied with nationwide, while other states began to pass their own laws.
Easy availability of confidential financial information, coupled with sloppy credit-granting practices by creditors and credit bureaus, makes it easy for identity thieves to open accounts in our name.
Security freezes give consumers real control over access to their credit report that no other identity theft prevention action provides them with. A freeze prevents access to your credit report to new creditors. This closes the loophole that identity thieves have exploited, since most businesses will not issue new credit or loans to people without first reviewing their credit reports. California enacted the first freeze law in 2001, and 16 states have followed with their own laws.
Now, the banks and credit card companies are pressuring Congress to override the strongest security freeze and breach notice laws, as well as dozens of other state identity theft reforms, with a weak federal law that won’t stop identity theft and won’t allow the states to innovate.
Under the flawed HR 3997, only previous identity theft victims would be able to use security freezes. That’s like saying only victims of car crashes could wear seat belts. And, the bill would allow companies that lost confidential information to decide whether it was important to tell us. Learn more.
Resources
Model Law: The State Clean Credit and Identity Theft Protection Act (Updated November 2005)
List of States That Have Passed Security Freeze Or Security Breach Laws (Updated April 2006)
