South San Francisco, CA October 4, 2017 Submitted by Leslie Guevarra, Office of Senator Hill
Bill Will Be Introduced When the Legislature Convenes January 3
SACRAMENTO – Senator Jerry Hill announced today that he will introduce consumer protection legislation to make it free for Californians to lock down their credit by placing a freeze with the nation’s credit reporting agencies.
“Alarming data breaches of personal information have become all too common and it doesn’t make sense to force Californians to pay to protect their credit,” said Senator Hill, D-San Mateo and Santa Clara Counties. “Credit agencies are involved in so many aspects of our lives – from buying a car and purchasing a home, to simply signing a new cell phone contract. The agencies possess our most sensitive information, and they shouldn’t profit from consumers’ efforts to protect their personal and financial data.”
Senator Hill’s legislation would amend the California Consumer Credit Reporting Agencies Act by removing the authorization for credit agencies to charge up to $10 to place or lift a credit freeze. The legislation will also ensure that credit freezes can be requested via the internet; current law provides for the request to be made by traditional mail.
“Consumers should be able to control the access to their credit information free of charge,” said Senator Hill. “Fraud and identity theft can hurt every segment of our economy – but the greatest damage befalls the consumer. Californians should have the right to protect themselves from being victimized by these crimes. I look forward to working with my colleagues in the Legislature, consumer advocates and the credit industry next year to advance this bill and make it law.”
There are three major credit reporting agencies – Equifax, TransUnion and Experian. Experts say freezes are most effective if placed with all three credit agencies – a move that would cost $30 to freeze credit and another $30 to thaw it under the fees permitted by current California law. The law allows people older than 65 years to place a freeze without charge, but they must pay $5 to unfreeze their credit. Freezes are free for victims of identity theft who have filed a police report.
According to the U.S. Public Research Interest Group, only four states allow free credit freezes and thaws – Indiana, Maine, and North and South Carolina. U.S. PIRG also reports that 158 million consumers live in states that allow the fees and if all those consumers locked down their credit, it would result in a total cost of $4.1 billion.
Bills have been introduced in Illinois and Massachusetts to provide for free credit freezes in those states. On the federal level, U.S. Senator’s Elizabeth Warren, D-Mass., and Senator Brian Schatz, D-Hawaii, have introduced legislation to allow for free credit freezes.
The hacking of credit reporting agency Equifax was the latest incident in a disturbing trend. Made public in September months after the incursion, the hack of Equifax exposed the personal data and credit information of more than 145 million consumers. The hackers gained access to names, social security numbers, birth dates and driver’s license numbers.
Other recent massive data breaches involved:
- Yahoo: At least 3 billion accounts were compromised in 2013, exposing names, email address, birth dates, telephone numbers and passwords.
- EBay: 145 million users’ names, addresses, birth dates and passwords were compromised when the firm was hacked in 2014.
- Target: 70 million customers were affected by the exposure at the height of the December 2013 holiday season of personal information that included street addresses, email addresses and telephone numbers.
- Federal Office of Personnel Management: The personal information of 22 million federal workers, including sensitive data such as security clearances and social security numbers, was compromised in 2015.
- Anthem: At least 78 million Anthem customers’ names, social security numbers and birth dates and other personal information related to their medical records were exposed in a 2015 data breach.
- Experian/T-Mobile: 15 million T-Mobile customers’ names, social security numbers, dates of birth, addresses and driver’s license numbers were stolen by hackers who breached the data system of Experian, which processed T-Mobile credit applications.