Notes On Consumer Affairs
From November 1999 to September 2001, the FTC's Identity theft clearinghouse received a total of 94,100 complaints and is now averaging more than 2000 calls a week. In that same time frame, New York City registered the highest number of complaints in the nation with 3,916.
Identity theft involves "stealing' another person's personal identifying information, such as a social security number, date of birth and using the information to fraudulently establish credit, run up debt or take over existing financial accounts.
Identity theft can cause harm to the lives of individual citizens, both emotionally and economically. Even though financial institutions may not hold victims liable for fraudulent debts, victims often feel personally violated and have reported significant amounts of time trying to resolve problems such as credit card application rejections, debt collection, loan denials and bounced checks.
In 1998, Congress enacted legislation, The Identity Theft and Assumption Deterrence Act of 1998, which made identity theft a federal crime and recognized that victims include individuals as well as financial institutions and other business entities. Since 1998, most states have enacted identity theft laws. Although a federal crime, state legislation is important in order to provide local district attorneys the power to prosecute cases.
For the past five years, identity theft legislation has been my top legislative priority. As Chairwoman of the Assembly Committee on Consumer Affairs, the Committee has held hearings, press conferences and countless meetings with consumer and industry groups in attempts to progress legislation.
This year, I am proud to report that my bill, A.4939-C, will be enacted into law. A.4939-C defines consumers as the victim of the crime, not just financial institutions. It sets out a range of penalties for those attempting or who have committed identity theft-ranging from a class A misdemeanor to a Class D felony. It also criminalizes the possession of personal information. This provision captures individuals who, without authorization, compile and sell personal information but do not actually engage in identity theft.
This legislation provides law enforcement and local district attorneys with the tools they need to prevent identity theft. It also provides consumers with restitution and a private right of action to recoup losses.
By enacting an identity theft law, New York will be able to take bold steps in minimizing our status as one of the top states in which identity theft occurs. Both consumers and industry benefit from this law, as it will reduce financial risk due to fraud.