[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4311 Introduced in House (IH)]







106th CONGRESS
  2d Session
                                H. R. 4311

 To prevent identity fraud in consumer credit transactions and credit 
                    reports, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             April 13, 2000

  Ms. Hooley of Oregon (for herself, Mr. LaTourette, Mr. LaFalce, Mr. 
Bentsen, Mr. Hill of Montana, Mr. Kanjorski, Mrs. Maloney of New York, 
   Mr. Ney, Mr. Metcalf, Mr. Sandlin, Ms. Carson, Mr. Moore, and Mr. 
  Ackerman) introduced the following bill; which was referred to the 
              Committee on Banking and Financial Services

_______________________________________________________________________

                                 A BILL


 
 To prevent identity fraud in consumer credit transactions and credit 
                    reports, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Identity Theft Prevention Act of 
2000''.

SEC. 2. FINDINGS.

    The Congress finds the following:
            (1) The crime of identity theft has become one of the major 
        law enforcement challenges of the new economy, as vast 
        quantities of sensitive, personal information are now 
        vulnerable to criminal interception and misuse.
            (2) The United States Postal Inspection Service estimates 
        that 50,000 people a year have become victims of identity theft 
        since the mid-1990's.
            (3) The United States Secret Service investigated identity 
        theft losses to individuals and institutions of $745,000,000 in 
        1997, a 75 percent increase over the $442,000,000 lost in 1995.
            (4) According to TransUnion Corporation, a national credit 
        bureau, the total number of identity theft inquiries to its 
        Fraud Victim Assistance Department grew from 35,235 in 1992 to 
        522,922 in 1997.
            (5) Credit issuers, credit reporting agencies, and other 
        organizations with access to sensitive personal data have an 
        obligation to handle such information responsibly, and should 
        take affirmative steps to prevent identity criminals from 
        intercepting such information.
            (6) Identity theft causes extraordinary damage to its 
        victims, jeopardizing their access to needed credit forcing 
        many to spend years trying to restore their good name.
            (7) The resources available to identity theft victims are 
        inadequate, and both the private sector and Federal agencies 
        should provide better and more sympathetic assistance to such 
        victims.
            (8) Credit reporting agencies and credit issuers should 
        have uniform reporting requirements and effective fraud alerts 
        to assist identity theft victims in repairing and protecting 
        their credit.
            (9) Consumers need greater access to information that is 
        collected about them so they can quickly identify fraudulent 
        activity.

SEC. 3. CHANGES OF ADDRESS.

    (a) Duty of Issuers of Credit.--Section 132 of the Truth in Lending 
Act (15 U.S.C. 1642) is amended--
            (1) by striking ``No credit'' and inserting ``(a) In 
        General.--No credit''; and
            (2) by adding at the end the following new subsection:
    ``(b) Confirmation of Change of Address.--
            ``(1) In general.--Not later than 10 days after receiving 
        notification form a cardholder of a change of address, a card 
        issuer shall send to the card holder, both to the new address 
        and to the former address of the cardholder, written 
        confirmation of that change of address.
            ``(2) Notification of Request For Additional Cards.--If a 
        card issuer receives a request for an additional credit card 
        with respect to an existing credit account not later than 30 
        days after receiving notification of a change of address for 
        that account, the card issuer shall notify the card holder of 
        the request at both the new address and the former address.''.
    (b) Duty of Consumer Reporting Agencies.--Section 605 of the Fair 
Credit Reporting Act (15 U.S.C. 1681c) is amended by adding at the end 
the following new subsection:
    ``(g) Notice of Potential Fraud.--A consumer reporting agency shall 
notify each user of a consumer report that is a creditor (as defined in 
section 103) if the agency becomes aware that an application to the 
card issuer to open a new credit card account bears an address for the 
consumer that is different from the address in the file of the 
consumer.''.
    (c) Enforcement.--
            (1) Federal trade commission.--Except as provided in 
        paragraph (2), compliance with section 132(b) of the Truth in 
        Lending Act (as added by subsection (a)(2) of this section) 
        shall be enforced by the Federal Trade Commission in the same 
        manner and with the same power and authority as the Commission 
        has under the Fair Debt Collection Practices Act to enforce 
        compliance with that Act.
            (2) Other agencies in certain cases.--Compliance with 
        section 132(b) of the Truth in Lending Act (as added by 
        subsection (a)(2) of this section) shall be enforced under--
                    (A) section 8 of the Federal Deposit Insurance Act, 
                in the case of a card issuer that is--
                            (i) a national bank or a Federal branch or 
                        Federal agency of a foreign bank, by the Office 
                        of the Comptroller of the Currency;
                            (ii) a member bank of the Federal Reserve 
                        System (other than a national bank), a branch 
                        or agency of a foreign bank (other than a 
                        Federal branch, Federal agency, or insured 
                        State branch of a foreign bank), a commercial 
                        lending company owned or controlled by a 
                        foreign bank, or an organization operating 
                        under section 25 or 25A of the Federal Reserve 
                        Act, by the Board of Governors of the Federal 
Reserve System;
                            (iii) a bank insured by the Federal Deposit 
                        Insurance Corporation (other than a member of 
                        the Federal Reserve System or a national 
                        nonmember bank) or an insured State branch of a 
                        foreign bank, by the Board of Directors of the 
                        Federal Deposit Insurance Corporation; and
                            (iv) a savings association, the deposits of 
                        which are insured by the Federal Deposit 
                        Insurance Corporation, by the Director of the 
                        Office of Thrift Supervision; and
                    (B) the Federal Credit Union Act, by the 
                Administrator of the Nation Credit Union 
                Administration, in the case of a card issuer that is a 
                Federal credit union, as defined in that Act.
            (3) Violations treated as violations of other laws.--
                    (A) In general.--For the purpose of the exercise by 
                any agency referred to in this subsection of its powers 
                under any Act referred to in this subsection, a 
                violation of section 132 (b) of the Truth in Lending 
                Act (as added by subsection (a)(2) of this section) 
                shall be deemed to be a violation of a requirement 
                imposed under that Act.
                    (B) Powers under other laws.--In addition to the 
                powers under any provision of law specifically referred 
                to in paragraph (1) or (2), each of the agencies 
                referred to in those paragraphs may exercise, for the 
                purpose of enforcing compliance with section 132 (b) of 
                the Truth in Lending Act (as added by subsection (a)(2) 
                of this section), any other authority conferred on such 
                agency by law.

SEC. 4. FRAUD ALERTS.

    Section 605 of the Fair Credit Reporting Act (15 U.S.C. 1681c) is 
amended by adding at the end the following new subsection:
    ``(h) Fraud Alerts.--
            ``(1) In general.--Upon the request of a consumer, a 
        consumer reporting agency shall include a fraud alert in the 
        file of that consumer.
            ``(2) Notice to users.--A consumer reporting agency shall 
        notify each person procuring consumer credit information with 
        respect to a consumer of the existence of a fraud alert in the 
        file of that consumer regardless of whether a full credit 
        report, credit score, or summary report is requested.
            ``(3) Penalties.--Any consumer reporting agency that fails 
        to comply with this subsection, and any user of a consumer 
        report that fails to comply with preauthorization procedures 
        contained in a fraud alert and issues or extends credit in the 
        name of the consumer to a person other than the consumer, shall 
        be in violation of this section.
            ``(4) Definition.--For purposes of this subsection, the 
        term `fraud alert' means a clear and conspicuous statement in 
        the file of a consumer that notifies all prospective users of a 
        consumer report made with respect to that consumer that the 
        consumer does not authorize the issuance or extension of credit 
        in the name of the consumer unless--
                    ``(A) the issuer of such credit first obtains 
                verbal authorization from the consumer at a telephone 
                number designated by the consumer; or
                    ``(B) the issuer complies with such other method of 
                preauthorization by the consumer as is mutually agreed 
                upon by the consumer and the consumer reporting 
                agency.''.

SEC. 5. REGULATIONS ON DUTY TO INVESTIGATE.

    Before the end of the 6-month period beginning on the date of the 
enactment of this Act, the Federal Trade Commission shall prescribe 
regulations to require each consumer reporting agency (as defined 
section 603 of the Fair Credit Reporting Act) to investigate 
discrepancies between personal or identifying information contained in 
the file maintained by the agency with respect to a consumer and in the 
personal and identifying information supplied to the agency by the user 
of the consumer report.

SEC. 6. FREE REPORTS ANNUALLY.

    Section 612(c) of the Fair Credit Reporting Act (15 U.S.C. 
1681j(c)) is amended to read as follows:
    ``(c) Free Annual Disclosure.--Upon the request of the consumer, a 
consumer reporting agency shall make all disclosures pursuant to 
section 609 once during any 12-month period without charge to the 
consumer.''.

SEC. 7. IDENTIFYING INFORMATION.

    (a) Limitation.--The Fair Credit Reporting Act (15 U.S.C 1601 et 
seq.) is amended--
            (1) by redesignating section 624 with the heading 
        ``Relation to State laws'' (15 U.S.C. 1681t, as so designated 
        by section 2413 of Public Law 104-208) as section 626 and 
        moving that section and inserting it after section 625 (as so 
        designated by paragraph (2) of this section);
            (2) by redesignating section 624 with the heading 
        ``Disclosures to FBI for counterintelligence purposes'' (15 
        U.S.C. 1618u, as added by section 601 of Public Law 104-93) as 
        section 625; and
            (3) by inserting after section 623 the following new 
        section:

``SEC. 624. OTHER IDENTIFYING INFORMATION.

    ``Except as provided in section 608, a consumer reporting agency 
may furnish consumer identifying information, other than the name, 
generational designation, and current address of the consumer, only in 
a consumer report.''.
    (b) Disclosures to Governmental Agencies.--Section 608 of the Fair 
Credit Reporting Act (15 U.S.C. 1618f) is amended by striking ``section 
604'' and inserting ``sections 604 and 623''.
    (c) Permissible Purposes.--Section 604(a) of the Fair Credit 
Reporting Act (15 U.S.C.1681b(a)) is amended in the matter proceeding 
paragraph (1) by inserting ``or any identifying information (other than 
the name, generational designation, or current address of the 
consumer)'' after ``a consumer report''.

SEC. 8. INDIVIDUAL REFERENCE SERVICES.

    (a) In General.--An individual reference services provider shall, 
upon request and proper identification of a consumer--
            (1) clearly and accurately disclose to the consumer the 
        nature, content, and substance of all information in the file 
        maintained by the provider with respect to the consumer at the 
        time of the request that is obtainable based upon the 
        identifying information supplied by the consumer when making 
        such request; and
            (2) if the consumer has made a written request, deliver a 
        written copy or photocopy of all information described in 
        paragraph (1), together with a clear, simple, and plain meaning 
        explanation of the information provided under this subsection, 
        in a readable format and type, which shall in no case be 
        smaller than 10 point type.
    (b) Individual Reference Services Provider Defined.--
            (1) In general.--For purposes of this section, the term 
        ``individual reference services provider''--
                    (A) means any person who, for monetary fees, dues, 
                or on a cooperative nonprofit basis regularly engages 
                in the practice of creating, assembling, evaluating, or 
                providing information, either directly or as a supplier 
                to others, with respect to any person regarding any 2 
                or more items of information described in paragraph 
                (2); and
                    (B) does not include the Federal Government or any 
                State government or political division thereof.
            (2) Types of Information.--The items of information 
        described in this paragraph are as follows:
                    (A) Social Security number or other social security 
                information.
                    (B) Mother's maiden name.
                    (C) Prior address.
                    (D) Birth date.
                    (E) Criminal history.
                    (F) History of civil actions.
                    (G) Driving records.
                    (H) Vehicle information.
                    (I) Past employment history.
                    (J) Income level.
                    (K) Tax records.
                    (L) History of voter registration.
                    (M) Other similar information, as determined by the 
                Federal Trade Commission.

SEC. 9. MODEL FORMS.

    (a) In General.--Before the end of the 6-month period beginning on 
the date of the enactment of this Act, the Federal Trade Commission 
shall develop a model form and standard procedures to be used by 
consumers that are victims of identity fraud in contacting and 
informing creditors and credit reporting agencies of such fraud, if the 
Commission determines, at that time, that issuers of credit and credit 
reporting agencies have failed to jointly develop such a model form and 
standard procedures.
    (b) Contents.--A model form developed under subsection (a) (by the 
Commission or any other person referred to in subsection (a)) shall 
require information necessary to demonstrate the fraudulent activity 
done in the name of the consumer to whom the form relates, including, 
if applicable--
            (1) a notarized affidavit or police report relating to the 
        activity;
            (2)a notarized handwriting sample; and
            (3) any other relevant documentation.
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