Privacy, identity theft heat up as political issues

Lawmaker proposing remedies

BY FRITZ MAYER

fritzmayer@riverreporter.com

UNITED STATES — The advent of the internet has pushed issues of privacy and identity theft onto the radar screens of residents everywhere.

At a recent veterans meeting at the Sullivan County Government Center, there was much talk about the May theft of a laptop that contained the identities of 20 million veterans. In Albany, NY, Attorney General Elliot Spitzer is suing a company called Gratis Internet for selling the personal information of millions of consumers after promising not to do so. In Liberty, Sean Walsh, who fields consumer complaint calls at the Cornell Cooperative Extension, said he gets a lot of calls from residents concerned about identity theft and internet privacy.

With the issue becoming ever larger, politicians are beginning to take action.

In New York, beginning in November, consumers will be able to put a “credit freeze” on their financial information with a phone call to any of the three main credit reporting agencies: TransUnion, Equifax or Experion. When a consumer places a freeze, it will prevent identity thieves from opening new accounts in the consumer’s name. Similar legislation has been adopted in 23 states. In Pennsylvania, such legislation has been introduced, but has not been voted on.

So far, individual states have taken the lead in the privacy arena, but that may soon change as lawmakers in Washington begin to address the matter. Senator Hillary Clinton, who is running for a second term in New York, has called for a “Privacy Bill of Rights.” She is urging legislation that would guarantee the freezing of credit information at the national level. It would also require that any companies that deal with credit or identity information immediately notify consumers if their credit is comprised.

In the House of Representatives, two competing privacy bills¾ the Data Accountability And Trust Act (DATA) and the Financial Data Protection Act (FDPA)¾are now under consideration. The consumer advocacy group, Consumer’s Union (CU), supports DATA and opposes FDPA.

According to CU, the DATA act would be much better in several areas. The DATA Act would allow consumers to freeze their credit information at any time for any reason. It would then be possible for consumers to keep their credit information permanently frozen, but it could be temporarily unfrozen when a consumer wants to apply, say, for a new credit card. The FDPA act would not allow consumers to freeze their credit information unless they had already become a victim of identity theft.

Also, the DATA act would allow consumers to see and correct information held by the three main credit organizations, and it would also allow access to so-called data broker databases, such as ChoicePoint, which sell large amounts of information on individuals, ranging from financial records to health and arrest records.

A push from corporations

With lawmakers now considering legislation, interested corporations are lining up to let their views be known. Twelve technology companies, including Google and eBay, announced last month the formation of the Consumer Privacy Legislative Forum, to lobby for greater protection of private information.

Other interested parties have cautioned against over regulating the data that companies gather online. Testifying before a house subcommittee three weeks ago, Thomas M. Lenard, senior fellow at the Progress & Freedom Foundation, said markets work better with more information. “As the cost of information goes down, market participants obtain more of it and, consequently, make better decisions,” he said.

A statement from CU said the organization recognized that the abundance of information allows companies to offer consumers goods and services that might be of interest to them, still the organization said that any privacy legislation should offer consumers meaningful choices regarding the use of their personal information.