Identity Theft Law
MSNBC has posted an article on a proposed law to stop identity theft. In the article, it references two recent stories from ChoicePoint and Lexis-Nexis.
“High-profile data leaks at information warehouse companies such as ChoicePoint and Lexis-Nexis are keeping the U.S. postal service busy, with well over 1 million bad-news letters telling consumers they are now vulnerable to identity theft. People who receive the letters have one immediate question: What do I do now? Generally, the answer has been vague and unsatisfying: watch your credit report and hope for the best.”
The solution? A credit report “security freeze”. “Put simply, a freeze would lock down a consumer's credit report, preventing anyone -- including the legitimate consumer -- from instantly opening new credit cards or taking out loans. Only after a consumer provides additional evidence they are who they say they are, a process known as "thawing," can credit be granted. Thawing can take up to three days, and generally can't be done at the point of sale, such as that critical moment when consumers find themselves unexpectedly across a table from a car salesman. But freezes also prevent identity thieves from making high-speed credit purchases and opening new accounts.
My response? What’s wrong with this idea? I think it’s a great idea. But, as you can imagine, those that provide consumer credit are up in arms. Why? No more impulse buying, and they know it. There are comments related to “they’ll lose 10 percent discounts for opening new accounts”. My response? If you want my business, extend the discounts until I prove who I say I am. How difficult is that?
There’s another quote I found hysterical. “Ultimately (telling someone to use a credit freeze) is bad advice," said Stuart Pratt, CEO of the Consumer Data Industry Association, which lobbies for the credit bureaus. "It's a little like telling consumers to brick up their windows and doors to prevent burglary, but then you can't get out of house when you need to."
Brick up my windows and doors to prevent burglary? What? Because there is a plan to have to wait three days to ensure someone doesn’t steal something from me that’s very difficult to get back? I’d still be able to buy those cars, and the homes, and everything else I need. I don’t see how it relates, but I can certainly see why those who issue credit are worried. Point is, who are they worried about?