Thawing identity theft protection
US capitol building
KAI RYSSDAL: I got a letter in the mail yesterday. From the Department of Veterans Affairs. Three weeks after news broke that personal data for 26 million vets had been stolen, the government officially let me know I might be one of them. In a way, that could actually work out pretty well for me. I'll be able to protect myself before something bad happens. But the House is considering a new privacy protection bill that could make it harder for consumers to prevent identity theft. Marketplace's Amy Scott explains.
AMY SCOTT: If you live in North Carolina and you're worried about identity theft, the law allows you to block access to your credit records. That prevents anyone from opening a credit card or applying for a loan in your name.
The proposed federal bill would override North Carolina's law and laws in 16 other states. Only victims of identity theft could freeze their records. And only after they file a police report alleging a specific crime was committed. Roy Cooper is North Carolina's Attorney General.
ROY COOPER: A bullet proof vest works better if you put it on before you get shot. This federal law allows people to get security freezes, but only after they've become a victim of identity theft. That doesn't make a lotta sense.
Lobbyists for the financial services industry say a credit freeze is too drastic for most people. For example, you wouldn't be able to open that store credit card to get a discount at the check-out counter. Wayne Abernathy with the American Bankers Association says there's an alternative. Consumers can place fraud alerts on their credit records so that banks and businesses proceed with caution before opening an account in their names.
WAYNE ABERNATHY: It's much like somebody who's concerned about traffic. It allows you to have greater safety features. Whereas a freeze basically says, "I'm throwing the keys away. I'm not getting in the car anymore."
Consumer advocates say fraud alerts don't go far enough. All a thief needs to get past one is your name, social security number and date-of-birth. That's exactly the information some identity thief now has on Kai and 26 million other veterans.
In New York, I'm Amy Scott for Marketplace.