AG McKenna’s Pleased Credit Freeze Legislation Now Law
OLYMPIA – Washington residents have a new way to protect themselves from identity thieves. Attorney General Rob McKenna said today’s signing of a preventative credit security freeze law, which he pursued during the past two legislative sessions, is crucial in lowering the risk of unauthorized credit or bank accounts being opened. The law also helps shield existing victims from additional harm to their credit reports.
Governor Chris Gregoire signed Substitute Senate Bill 5826 today following unanimous approval by the Legislature. The law will take effect Sept. 1, 2008. It amends Washington’s Fair Credit Reporting Act to allow any Washington resident to freeze unauthorized access to their credit reports. Consumers who want to apply for new credit will be able to temporarily “thaw” a freeze within 15 minutes.
“Too many Washington consumers have experienced financial devastation and frustration that comes with being an identity theft victim, as well as the cumbersome task of cleaning up the damage,” McKenna said. “Legislators did the right thing this session when they united in their support of a preventative credit security freeze law and gave consumers a crucial defense tool.
“Everyone benefits when fewer consumers are at risk of becoming identity theft victims,” McKenna continued. “Law enforcement benefits by less complex cases. Businesses will benefit by taking fewer losses, and the creation of an instant thaw means they won’t lose customers. Consumers will be able to quickly and conveniently provide access to their credit reports when they want to buy a car, obtain a mortgage or apply for a new credit card.”
Sen. Jean Berkey, D-Everett, was the primary sponsor of SSB 5826. She said, “Consumers need to understand that they must take proactive steps to protect themselves from identity theft. A credit freeze is the first step in consumer protection.”
Earlier this session, McKenna joined legislators and leaders from AARP and the Washington Credit Union League in encouraging the Legislature to pass a stronger freeze bill.
“The Washington Credit Union League congratulates Governor Gregoire, Attorney General McKenna and the state Legislature for their leadership in fighting for credit union members and all consumers on the issue of identity theft,” said John Annaloro, president and CEO of the Washington Credit Union League. “The credit freeze law isn’t a silver bullet that eliminates the threat, but it will minimize the damage by preventing thieves from accessing fraudulent lines of new credit from stolen information.”
"The question we've asked all along is 'whose credit is it anyway?'” said AARP Advocacy Director Lauren Moughon. "Our state Legislature has answered loud and clear. A preventative security freeze puts the power over our credit back where it belongs – in the hands of the consumer."
McKenna said SSB 5826 and a pair of similar House bills prime sponsored by Reps. Christopher Hurst, D-Enumclaw, and Deb Wallace, D-Vancouver, respectively, clearly demonstrated strong bi-partisan support for the issue.
“Protecting consumers from ID theft was one of my top priorities when I decided to return to the House,” Hurst said. “This legislation will allow every consumer to freeze their credit before they become a victim.”
"This new law will empower people to protect their credit before it's damaged,” Wallace agreed. “As one constituent told me, being able to freeze your credit only after you've become a victim is like closing the barn door after the horse has escaped. We can prevent these crimes, rather than just waiting for them to happen and responding after the fact."
Washington’s existing statute, RCW 19.182.170, allows identity theft victims and people whose information was potentially compromised in a data breach to request a freeze. But the law doesn’t protect consumers whose wallets are stolen, for example, until that information is actually used to commit fraud – and by then, it’s too late.
Unlike a fraud alert, which places a statement on your credit report, a security freeze means that your credit file cannot be shared with potential creditors. A freeze can prevent identity theft since most businesses will not open credit accounts without checking a consumer's credit history first.
“The credit freeze bill is a great start in combating identity theft,” said Rep. Dan Roach, R-Bonney Lake, a strong supporter of credit freeze legislation and a member of Washington’s Law Enforcement Group Against Identity Theft (LEGIT), a policy advising group created by McKenna. "This opens up the process to any citizen of Washington, not just those who have been victims of identity theft. It also simplifies the process to freeze your credit reports or to reopen them when you need to do so. It is more convenient and still provides personal security."
Under the new law, identity theft victims and seniors ages 65 and older will be able to place a freeze for free. Other consumers would pay to up to $10 to each bureau for placement of a freeze, a temporary lift or removal. Consumers who aren’t entitled to a free freeze would therefore pay a total of $30 to freeze their reports with the three major credit reporting agencies, Equifax, Experian and Trans Union.
More information about Washington’s security freeze law can be found on the Attorney General’s Web site by clicking here.
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Media Contact: Kristin Alexander, Seattle Media Relations Manager, (206) 464-6432, cell: (206) 437-2654