MA House Passes Important Consumer Protection Bill

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MA House Passes Important Consumer Protection Bill

MASSPIRG praises leadership



(Boston) In a Valentine for Massachusetts consumers, the Massachusetts House of Representatives unanimously voted to pass a key identity theft protection bill (An Act Removing Fees for Security Freezes and Disclosures of Consumer Credit Reports, HB 4232) which, if signed into law, will enable consumers to safeguard their personal financial information by allowing them to “freeze” and “thaw” their credit files for free, among other protections.

“This is better than chocolate and flowers for every consumer in the state,” said Deirdre Cummings, MASSPIRG’s legislative director. “Representative Jennifer Benson (Lunenburg) the bill sponsor in the House and Representative Tackey Chan (Quincy) the Chairman of the Consumer Protection Committee led the effort in the House, and their leadership should be commended.”

The problem of identity theft, and in particular the lack of security and protections for consumers who are harmed by sloppy practices by the credit bureaus, hit the front pages in the fall. The behemoth credit bureau Equifax, which keeps sensitive personal financial information on everyone, revealed a massive security breach jeopardizing three million Massachusetts residents’ security and 143 million Americans nationwide. Just this past weekend it was revealed that not only did Equifax wait months before alerting the public and authorities about the breach, they failed to disclose that license numbers and tax IDs, in addition to social security numbers, birthdates and other information were stolen.

Currently, the three major credit bureaus – Equifax, TransUnion, and Experian – charge Massachusetts consumers $5 to freeze their credit reports and an additional $5 every time they want to thaw, or lift, the freeze. While some of the fees are waived if you are a victim of identity theft and have a police report, it is too onerous and more importantly too late for consumers to protect themselves. When it becomes law, this bill will allow consumers to freeze and unfreeze (thaw) their credit reports at all credit bureaus for free. Maine, Indiana, and North and South Carolina already have passed laws allowing all consumers to freeze and thaw their credit reports for free, and there are credit freeze bills pending in many states as a result of the recent security breach by Equifax.  

The bill now heads to the Senate where Senator Barbara L’Italien (Andover) is leading the effort to protect consumers from Identity Theft by including some additional important consumer protections such as seeking consent from a consumer before his or her credit report is obtained, and requiring encryption of personal information for entities with access to the personal information of large numbers of people.  Senator L’Italien’s bill on this issue was assigned to the Senate Committee on Ways & Means today.

Last year over $16 billion was stolen from 15 million Americans as a result of identity theft – a 16% jump from the prior year.  While consumers are not individually liable for the fraudulent charges, they spend endless time, effort and frustration in clearing up their credit reports and restoring their good names after they have been victimized. All consumers pay for cost of ID theft through higher interest rates and fees.