Washington Passes Credit Security Freeze Law

Washington has signed a credit security freeze law, designed to protect residents from identity thieves. According to the office of Attorney General Rob McKenna, the law should reduce the risk of unauthorized credit or bank accounts being opened, and help to shield existing victims from additional harm to their credit reports.

Governor Chris Gregoire signed Substitute Senate Bill 5826, sponsored by Sen. Jean Berkey, D-Everett, yesterday following unanimous approval by the Legislature. The law will take effect Sept. 1, 2008. It amends Washington’s Fair Credit Reporting Act to allow any Washington resident to freeze unauthorized access to their credit reports. Consumers who want to apply for new credit will be able to temporarily “thaw” a freeze within 15 minutes, the AG’s office said.

McKenna said SSB 5826 and a pair of similar House bills prime sponsored by Reps. Christopher Hurst, D-Enumclaw, and Deb Wallace, D-Vancouver, respectively, clearly demonstrated strong bi-partisan support for the issue.

Washington’s existing statute, RCW 19.182.170, also allows identity theft victims and people whose information was potentially compromised in a data breach to request a freeze. However, the law doesn’t protect consumers whose wallets are stolen, for example, until that information is actually used to commit fraud – and by then, it’s too late, the AG’s office said.

Unlike a fraud alert, which places a statement on a credit report, a security freeze means that the credit file cannot be shared with potential creditors. A freeze can prevent identity theft since most businesses will not open credit accounts without checking a consumer’s credit history first.

Under the new law, identity theft victims and seniors ages 65 and older will be able to place a freeze for free. Other consumers would pay to up to $10 to each bureau for placement of a freeze, a temporary lift or removal. Consumers who aren’t entitled to a free freeze would therefore pay a total of $30 to freeze their reports with the three major credit reporting agencies, Equifax, Experian and Trans Union.

For more information about Washington’s security freeze law, visit www.atg.wa.gov/ConsumerIssues/ID-Privacy/SecurityFreeze.aspx.

Source: AG