H. B. 2501
(By Delegates Marshall, Hatfield, Tucker,
Fragale, Miley and M. Poling)
[Introduced January 9, 2008; referred to the
Committee on Banking and Insurance then the Judiciary.]
A BILL to amend the Code of West Virginia, 1931, as amended, by
adding thereto a new article, designated º46A-2A-101 and
º46A-2A-102, all relating to enabling a consumer to direct a
consumer reporting agency to place a "security freeze" on his
or her credit report.
Be it enacted by the Legislature of West Virginia:
That the Code of West Virginia, 1931, as amended, be amended
by adding thereto a new article, designated º46A-2A-101 and
º46A-2A-102, all to read as follows:
ARTICLE 2A. CREDIT REPORT SECURITY FREEZES BY CONSUMER REPORTING
AGENCIES.
º46A-2A-101. Definitions
.
In this article:
(1)"Consumer" means any person who is utilizing or seeking
credit for personal, family or household purposes.
(2)"Consumer reporting agency" means any person who, for
monetary fees, dues, or on a cooperative nonprofit basis, regularly
engages, in whole or in part, in the practice of assembling or
evaluating consumer credit information or other information on
consumers for the purpose of furnishing consumer reports to third
parties.
(3)"Credit report
"
means any written, oral, or other
communication of any information by a consumer reporting agency
bearing on a consumer's creditworthiness, credit standing, credit
capacity, general reputation, personal characteristics, or mode of
living which is used or expected to be used or collected, in whole
or in part, for the purpose of serving as a factor in establishing
the consumer's eligibility for any of the following:
(A) Credit to be used primarily for personal, family, or
household purposes.
(B) Employment purposes.
(C) Any other purpose authorized under 15 U.S.C. º1681(b).
(4)"Reviewing the account" or "account review" means
activities related to account maintenance, monitoring, credit-line
increases, and account upgrades and enhancements.
(5)"Security freeze" means a notice placed in a consumer's
credit report, at the request of the consumer, that prohibits the
consumer reporting agency from releasing the consumer's credit
report or any information from it without the express authorization of the consumer.
º46A-2A-102
.
Security freeze; timing; covered entities; cost.
(a)(1) A consumer may elect to place a security freeze on his
or her consumer report by making a request in writing by certified
mail to a consumer reporting agency.
(2) Except as provided in subsection (k), subdivision (2),
subsection (f) of this section, if a security freeze is in place,
information from a consumer report may not be released to a third
party without prior, express authorization from the consumer.
(3) This section does not prevent a consumer reporting agency
from advising a third party that a security freeze is in effect
with respect to the consumer report.
(b)(1) A consumer reporting agency shall place a security
freeze on a consumer report no later than five business days after
receiving the request from the consumer.
(2) The consumer reporting agency shall send a written
confirmation of the security freeze to the consumer within ten
business days and, with the confirmation, shall provide the
consumer with a unique personal identification number or password
to be used by the consumer when providing authorization for the
release of his or her consumer report to a specific party or for a
specific period of time.
(c) If a consumer wishes to allow his or her consumer report
to be accessed by a specific party or for a specific period of time while a freeze is in place, he or she shall contact the consumer
reporting agency, request that the freeze be temporarily lifted,
and provide the following:
(1) Proper identification;
(2) The unique personal identification number or password
provided by the consumer reporting agency pursuant to subdivision
(2), subsection (b) of this section; and
(3) The proper information regarding the third party who is to
receive the consumer report or the time period that the report
shall be available to users of the consumer report.
(d) A consumer reporting agency that receives a request from
a consumer to temporarily lift a freeze on a consumer report
pursuant to subsection (c) of this section, shall comply with the
request no later than three business days after receiving the
request.
(e) A consumer reporting agency may develop procedures
involving the use of telephone, fax, Internet or other electronic
media to receive and process a request from a consumer to place a
freeze or to temporarily lift a freeze on a consumer report
pursuant to subsection (c) of this section in an expedited manner.
(f) A consumer reporting agency shall remove or temporarily
lift a freeze placed on a consumer report only in the following
cases:
(1) Upon consumer request, pursuant to subsection (c) or (i) of this section; or
(2) If the consumer report was frozen due to a material
misrepresentation of fact by the consumer or somebody purporting to
be the consumer. If a consumer reporting agency intends to remove
a freeze on a consumer report pursuant to this subdivision, the
consumer reporting agency shall notify the consumer in writing
prior to removing the freeze placed on the consumer report.
(g) If a third party requests access to a consumer report on
which a security freeze is in effect, and the request is in
connection with an application for credit or other use, and the
consumer does not allow his or her consumer report to be accessed
by that specific party or during that period of time, the third
party may treat the application as incomplete.
(h) If a consumer requests a security freeze, the consumer
reporting agency shall disclose the process of placing and
temporarily lifting a freeze and the process for allowing access to
information from the consumer report to a specific party or for a
specific period of time while the freeze is in place.
(i) Except as otherwise provided pursuant to subdivision (2),
subsection (f) of this section, a security freeze shall remain in
place until the consumer requests that the security freeze be
removed. A consumer reporting agency shall remove a security freeze
within three business days of receiving a request for removal from
the consumer, who provides both of the following:
(1) Proper identification; and
(2) The unique personal identification number or password
provided by the consumer reporting agency pursuant to subdivision
(2), subsection (b) of this section.
(j) A consumer reporting agency shall require proper
identification of the person making a request to place a security
freeze in a manner consistent with the requirements of this
section.
(k) The provisions of this section shall not apply to the use
of a consumer report by or for any of the following:
(1) A person or entity, or a subsidiary, affiliate or agent of
that person or entity that owns a financial obligation owing by the
consumer to that person or entity, including a demand deposit
account, or to whom the consumer issued a negotiable instrument,
for the purposes of reviewing the account or collecting the
financial obligation owing for the account, contract, debt, or
negotiable instrument, and lawful associated costs;
(2) An assignee or a prospective assignee of a financial
obligation owing by the consumer to a person or entity in
subdivision (1) of this subsection;
(3) A subsidiary, affiliate, agent, assignee, or prospective
assignee of a person to whom access has been granted under
subsection (c) of this section for purposes of facilitating the
extension of credit or other permissible use;
(4) A state or local agency, law-enforcement agency, trial
court, private collection agency, or person acting pursuant to a
court order, warrant, or subpoena authorizing the use of the
consumer report;
(5) A child support enforcement agency acting to enforce child
support obligations;
(6) The Department of Health and Human Resources or its agents
or assigns acting to investigate fraud;
(7) The Department of Revenue or its agents or assigns acting
to investigate or collect delinquent taxes or unpaid court orders
or to fulfill any of its other statutory responsibilities or
exercise any of its statutory authority;
(8) The use of credit information for the purposes of
prescreening as provided by the "Fair Credit Reporting Act", 15
U.S.C. 1681, et seq.;
(9) Any person or entity administering a credit file
monitoring subscription service to which the consumer has
subscribed;
(10) Any person or entity for the purpose of providing a
consumer with a copy of his or her consumer report upon the
consumer's request;
(11) Any person or entity for use in setting or adjusting a
rate, adjusting a claim, or underwriting for insurance purposes;
(12) A pension plan acting to determine the consumer's eligibility for plan benefits or payments authorized by law or to
investigate fraud;
(13) A person conducting a presentence investigation in a
criminal matter or a probation officer using this information for
supervision of an offender;
(14) A collections investigator or other person engaged in the
collecting of fees, fines, or restitution assessed in a court
proceeding;
(15) A licensed hospital with which the consumer has or had a
contract, or a debtor-creditor relationship for the purposes of
reviewing the account or collecting the financial obligation owing
for the contract, account, or debt;
(16) A law-enforcement agency or its agents acting to
investigate a crime or conducting a criminal background check.
(l)(1) Fees for requesting a security freeze, temporarily
lifting a security freeze, and permanently removing a security
freeze from consumer reports may be charged only in accordance with
this subsection.
(2) A consumer reporting agency may not charge a fee for a
consumer's first request to place a security freeze on his or her
consumer report.
(3) Except as provided in subdivisions (1) and (2) of this
subsection, a consumer reporting agency may charge a consumer a
reasonable fee of no more than eight dollars for:
(A) A temporary lift for a period of time or permanent removal
of a security freeze from the consumer report; or
(B) A subsequent request for a security freeze of the consumer
report after the consumer's first request for a security freeze has
been permanently removed from his or her consumer report.
(4) Except as provided in subdivisions (1) and (2) of this
subsection, a consumer reporting agency may charge a fee not to
exceed ten dollars for temporarily lifting a security freeze on the
consumer report for a specific party.
NOTE: The purpose of this bill is to enable a consumer to
protect his or her credit against identity theft by permitting a
consumer to put a credit freeze on his or her credit report,
prohibiting access to and dissemination of information in a
consumer's credit report without his or her express consent.
This is a new article; therefore, underscoring and
strike-throughs have been omitted.
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