House Bill 130

Chair's Name: James Mills

Committee: Banks & Banking

House Sponsor: Calvin Hill

Chairman Mill’s Opinion of the legislation:

This legislation enables a consumer to request a credit reporting agency not to release the consumer report information by placing a “security freeze” on his or her credit report in order to prevent the extension of credit without the consumer’s authorization. The bill also allows the consumer to temporarily lift or remove a “security freeze” in order to make the credit report information available. This legislation provides a tool that will help to protect the consumer’s credit identity and enable the consumers to get access to their credit report while it is on a “security freeze” if necessary.

The driving force behind this legislation is the ongoing problem of identity theft. This legislation will enable an individual whose personal information has been stolen or jeopardized to place a security freeze on his or her credit report. This means that if an individual attempts to commit an identity theft by becoming involved in an activity (such as opening a credit card account or making a big purchase, i.e. a car, in another person’s name), that would result in a financial institution checking that person’s credit report, a financial institution will not be able to access the credit report due to the freeze placed by the owner and therefore will deny the fraudulent application.

This Legislation:

•  Increases Personal Responsibility by encouraging consumers to place a security freeze on their credit reports if their personal information has been stolen or jeopardized, allowing them to prevent another individual from accessing their credit report and making fraudulent purchases.

This committee substitute passed the House under the Modified Open Rule.

Further Action

The Senate substitute added a provision that fees charged for a security freeze place shall be subject to review by the commissioner of banking and finance(page 6, lines 29-35). A new section  was also added which states that anytime a consumer is required to receive a, “summary of rights” it shall include a notice explaining how a consumer can go about placing a security freeze on one’s credit report (page 7, lines 4-36). The Senate also added a free freeze for those over age 65 and allowed the commissioner to raise fees.

The House agreed to the Senate substitute as amended by the House, removing the language allowing the commissioner to raise fees.