Legislative Package Aimed At Reining In Identity Theft

Attorney General Spitzer and representatives of consumer advocacy and crime victims organizations today urged the State Legislature to pass legislation to protect consumers’ from identity theft and the unauthorized use of personal data.

Spitzer has submitted a package of bills aimed at providing consumers better control over the dissemination of their personal information, strengthening government’s ability to prosecute crimes leading to identity theft and increasing penalties for such crimes.

"It has been said that the theft of one’s identity and personal information is not a matter of ‘if’ but a matter of ‘when’," Spitzer said. "New York State must enact reforms to strengthen consumers’ ability to control personal information and to facilitate the prosecution of identity theft crimes."

In February, the Federal Identity Theft Data Clearinghouse reported that 38 percent of all fraud claims in 2004 related to identity theft, and New York State ranked seventh in the nation in per-capita identity theft reports. Moreover, a national survey conducted by the Federal Trade Commission estimated that the number of victims in 2002 approached 10 million, including 663,300 New Yorkers.

Spitzer noted that in the last nine weeks alone, numerous incidents have highlighted the issue including:

  • Two major information brokerage companies, ChoicePoint, Inc. and LexisNexis have admitted that data files of over 455,000 consumers were breached;
  • One of the world’s largest financial institutions, Bank of America, confirmed that backup tapes containing personal data on 1.2 million accounts were missing;
  • Federal authorities confirmed an investigation into the electronic hacking theft of eight million credit card accounts from the processor of credit transactions for MasterCard, Visa, Discover and American Express;
  • A popular shoe store chain, DSW Shoe Warehouse admitted that customer credit information was stolen from over 100 of its stores; and
  • Approximately 180,000 GM Mastercard holders will soon receive notification that someone might have stolen their personal information in a data breach at Polo Ralph Lauren Inc.
  • Spitzer’s legislative proposals would address many of these incidents by:
  • Providing identity theft victims better control over their personal identifying information, including: allowing for "security freezes" on credit files; and providing significantly increased protections against a private company’s disclosure of a customers’ social security numbers;
  • Requiring companies to provide notice to individual consumers involved in instances in which a security breach has exposed personal information concerning 500 or more New Yorkers;
  • Facilitating the ability of victims to file criminal complaints with law enforcement agencies;
  • Requiring that information brokers notify consumers whenever a report containing personal information - such as telephone numbers, bank account information, income, medical information, driving record, and purchasing preferences - has been issued and mandating the disclosure include contact information of the entity that requested the report. The bill also would provide consumers access to their profiles compiled by information brokers;
  • Establishing statewide personal information "opt-out" lists, similar to the Telemarketing Do Not Call program, for consumers who want to ensure their confidential personal information is not disclosed;
  • Facilitating prosecutions against computer hackers by creating specific criminal penalties for the use of encryption to conceal a crime, to conceal the identity of another person who commits a crime, or to disrupt the normal operation of a computer;
  • Increasing criminal penalties for gaining unauthorized access through a computer to data about employment, salary, credit or other financial or personal information;
  • Facilitating prosecutions against hackers and others who surreptitiously gain access to computers, but do not steal or destroy computer material.

For more information about identity theft or to file a complaint, consumers are encouraged to visit the Attorney General’s website at https://ag.ny.gov/consumer-frauds/tips or call his consumer help line at (800) 771-7755. Consumers also can go to Federal Trade Commission to file complaints by calling (877) IDTHEFT.


Support for the Attorney General’s Identity Theft Legislative Proposals

Charles Bell, Program Director of Consumers Union, publisher of Consumer Reports magazine: "New York state has a vital role to play in protecting consumers against the financial nightmare of identity theft. We strongly support this comprehensive legislation to strengthen law enforcement, and improve disclosure to consumers regarding security breaches that affect personal financial information."

Bell further added: "If companies become aware that sensitive customer information has been compromised or potentially stolen, consumers definitely want to know about that. Consumers should also have the right to place a 'security freeze' on their credit report, to prevent criminals from stealing their personal financial data."

Lois Aronstein, AARP New York State Director: "AARP New York commends the Attorney General for highlighting the issue of identity fraud, which is critical to older New Yorkers who are most vulnerable to crimes like credit card fraud. The Attorney General's aggressive efforts to institute greater controls on our members' personal identifying information and to increase penalties against these crimes are major steps to providing vital protections from this unthinkable crime to all New Yorkers.

Raini Baudendistel, Executive Director of the Crime Victims Assistance Center in Binghamton:
"Cases of identity theft are on the rise in our society due largely to rapidly changing technology. Currently victims of these crimes face immense obstacles in their attempts to report and prosecute these crimes. Legislation must be passed to begin protecting all of us. The laws that the Attorney General is proposing will begin to address these issues and advocate for these victims."

Travis Plunkett, Legislative Director of the Consumer Federation of America: "Once again, Attorney General Spitzer is leading the nation in his efforts to better protect consumers. The Consumer Federation of America applauds the Attorney General for his proposals to curb identity theft, toughen up penalties for individuals who commit data crimes by computer and to rein in out-of-control information brokers who sell highly-sensitive personal information without the consent of the consumers involved."

Chris Hoofnagle, Director of the Electronic Privacy Information Center: "Attorney General Spitzer continues to be on the vanguard of privacy protection by introducing comprehensive legislation to stem identity theft and the trade of our personal data. Data brokers have proven that we are not in control of our personal data, resulting in identity theft and fraudulent marketing. Spitzer’s legislative package will give individuals important new rights, and reduce the incidence of identity theft in New York."

Beth Givens, Director of the Privacy Rights Clearinghouse: "The AG's package of identity theft-related bills gives victims important tools to recover their financial health and enables consumers in general to take the steps necessary to avoid becoming victims."