THE MAGAZINE

Identity theft

In numerous states, lawmakers have addressed identity theft. In most cases, they are amending earlier laws, refining the state’s role in curbing identity theft, or enhancing criminal penalties for those convicted of committing such crimes.

Security freeze. Many states are allowing victims of identity theft to place a security freeze, also called a credit freeze, on their financial records so that no more damage can be done by identity thieves while the victim is sorting out the problem. For example, in New Jersey, a new law allows consumers to request a security freeze. This prohibits consumer reporting agencies from releasing any information about the consumer without express written permission. The agency may, however, report to third parties—such as someone applying for credit in the victim’s name—that a security freeze is in place. Similar laws were approved in Florida,Hawaii, and South Dakota.

A New Hampshire law requires that consumer reporting agencies allow victims of identity theft to place a security freeze free of charge. However, it allows any resident, even if they have not been a victim of theft, to place a security freeze on his or her information for a fee of no more than $10. A similar law was passed in Vermont.

A new North Carolina law allows victims of identity theft to put a freeze on their credit with national credit bureaus, making it impossible for criminals to apply for credit in their names. Another provision of the new law controls how Social Security numbers are collected and distributed by business and government agencies in the state.

Penalties. Several states have increased identity theft penalties for those who victimize the elderly or people with disabilities. For example, in Nevada, the crime of identity theft is a category C felony and is punishable by a minimum of one year in prison. If the crime is committed against a disabled person or anyone older than 60 years of age, it is considered a category A felony and merits a minimum of three years in prison. Similar measures have been passed in Louisiana, Ohio, and in the state of Washington.

Passports. Lawmakers in Delaware,Maryland, Iowa ,Nevada, and Ohio established what they call “identity theft passports.” The passports, which are approved by law enforcement and issued by the state government, document the identity theft perpetrated against a victim. The victim may then use the passport to prevent arrest for an offense committed by another person or to aid creditors in clearing a victim’s financial records.

Security provisions. A new law in Rhode Island contains provisions for placing a security freeze on a consumer account. The law also requires that any business that owns or licenses computerized, unencrypted information on customers implement and maintain reasonable security measures. These measures should be sufficient to protect the personal information from unauthorized access, destruction, use, modification, or disclosure.

A new Minnesota law provides for computer security, in addition to setting up an identity theft passport and establishing provisions for victims to put a security freeze on their accounts. The law makes it illegal to sell, obtain, disclose, or receive an individual’s telephone records without the permission of the individual. It also establishes security standards for telecom companies and requires that those companies report any data breaches.

In addition to prohibiting the sale or disclosure of an individual’s Social Security number (SSN), the law prohibits businesses from using an SSN as a person’s identifier within that business. Exceptions are provided in situations where an SSN is required, such as to access tax information or obtain a credit report.

Another part of the law would reverse the state’s data privacy policy. Currently, information is available to the public unless specifically prohibited from disclosure by law. Under the new proposal, the opposite would be true—all information would be kept private unless specifically designated, by law, to be released to the public.

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