N.J. Bill to Counter ID Thefts Gets Advanced

June 22, 2005
Bill would give consumer added tools to fight fraud, including 'security freeze' on credit reports

New Jersey consumers would get added tools to combat and react to identity theft under legislation the Assembly and Senate reconciled yesterday, setting up final votes this week.

If enacted, as expected, the measure would give residents among the most aggressive state support to deal with what has been described as an epidemic.

"It's a really big victory for New Jersey consumers," said Kerry Smith, senior consumer attorney for the New Jersey Public Interest Research Group.

The top provision of the broad legislation, she said, is a "security freeze" that would enable consumers to block access to their credit reports quickly. Credit or security freezes are intended to prevent thieves from gaining additional lines of credit.

Eight states have such a law, but Smith said New Jersey's would be the most progressive because it would require speedy action by credit-reporting agencies and cost less: free to turn on the freeze and $5 to temporarily turn it off.

The bills, which needed to be made identical before approval, are slated for votes Thursday, with no apparent opposition. The final version would go to acting Gov. Richard J. Codey, who has been supportive.

Other states with security-freeze provisions are California, Colorado, Louisiana, Maine, Nevada, Texas, Vermont and Washington.

Advocates consider Pennsylvania a laggard on the issue.

"We think Pennsylvania has far to go in adopting better identity-theft provisions," said Beth McConnell, state director of the Pennsylvania Public Interest Research Group. "Unfortunately, the legislature has so far failed to enact meaningful reforms to help combat identity theft."

Several bills are pending, including one with a security freeze, but have been watered down, stalled or both, she said.

Beth Givens, director of the San Diego-based Privacy Rights Clearinghouse, said New Jersey's legislation was a vital step for protecting victims and preventing crime.

"If you've got an aggressive identity thief, a credit freeze is about the only thing you can do to stop them," she said.

Identity theft and the potential of exposing personal and financial information to thieves, long publicized as a growing problem, has reached a new level.

MasterCard said last week that as many as 40 million credit-card accounts might have been breached by a computer hacker. CitiFinancial said earlier this month that computer tapes containing Social Security numbers of 3.9 million customers were lost.

In May, several banks announced that hundreds of thousands of accounts had been breached. North Jersey bank employees who allegedly carried out the plan have been arrested.

Douglas Johnston, governmental affairs manager for AARP in New Jersey, said New Jersey's legislation was welcome for its preventive features.

"Preventing a crime is even more important than punishing a crime after it happens," he said.