TRENTON – After hearing considerable testimony from consumer advocate groups last week, the Senate Commerce Committee approved bipartisan legislation today sponsored by Senators Shirley K. Turner, Byron Baer and Joseph Vitale that would require businesses to better maintain the confidentiality of their customers’ personal information and provide consumers with new tools to combat identity theft.
“It is becoming increasingly true that good credit is one of the most valuable things an individual can possess,” said Senator Turner, D-Mercer. “With innumerable credit card and financial transactions conducted over the Internet each day, the potential for identity theft is greater than ever. Today we are equipping consumers with a valuable new set of tools and safeguards that will better help them protect their credit and reduce the threat of identity theft.”
The bill, a committee substitute incorporating bills’ S-1914, S-2154, S-2155, S-2440, S-2441, and S-2524, would provide a broad array of protections against identity theft and actions that could be taken by victims of identity theft. The bill would require credit bureaus to allow individuals to place a security freeze on their credit reports. A security freeze is a mechanism by which an individual can block access to their credit report until they personally remove the block. Security freezes can help prevent identity thieves from taking out additional credit in the name of their victims.
The bill also would prohibit any public or private entity from publicly posting Social Security numbers, printing them on any card used to access services, or intentionally communicating them to the general public. In addition, no individual would be required to transmit his or her Social Security number over the Internet unless the connection is secure or to use his or her Social Security number to access an Internet website unless a password is also required to access the website.
“We need strong laws that will really protect against Social Security number theft,” Senator Baer, D-Bergen and Chair of the Senate Commerce Committee. “This piece of legislation will make it tougher for criminals to steal our identity. We need to make it illegal to mail any materials that include Social Security numbers, and drastically restrict the use of Social Security numbers on the Internet.”
Additionally, the bill would require local law enforcement agencies to take a police report from a person who reasonably believes he is the victim of identity theft and provide him or her with a copy of the report.
“Identity theft is often only the tip of the iceberg, with thieves misappropriating a victim’s name and identifying credit information to con and defraud, all while framing the innocent victims for their crimes,” said Senator Vitale, D-Middlesex. “We need to have protections in place to ensure that the victims of identity theft aren’t paying twice for the crimes of others. With the increasing prevalence of identity theft in today’s society, whether through the Internet or otherwise, we have to have safeguards to protect the innocent from exploitation.”
Senator Turner also noted that the bill would require businesses to take generally available, reasonable steps to destroy records and data that contain personal information that they no longer need to retain by shredding, erasing or otherwise modifying such information to make it unreadable and require businesses that conduct business in New Jersey and public entities to provide a notice to consumers when a breach of security has occurred which has caused or they reasonably believe has caused the consumer’s personal information to be accessed by an unauthorized person.
“Quick action can often protect an individual’s credit from great harm when an identity theft has occurred. By placing the impetus on businesses to quickly report any breach of security in their files containing the personal information of consumers, we are giving New Jersey’s residents the ability to move quickly to maintain their financial well-being,” explained Senator Turner.
The bill is co-sponsored by Republican Senators Walter Kavanaugh and Andrew Ciesla and has gained support from both the business community and public interest groups.
“I am proud to say the bill reflects a well-crafted, bipartisan compromise with input from the best minds of New Jersey’s business, banking and consumer interests,” added Senator Baer.
A reckless, willful or knowing violation of the proposed bill would be an offense under the Consumer Fraud Act. The penalties for such a violation would be triple the damages to the victim plus legal fees and costs. The Attorney General would also be able to seek injunctive action against the individual or company to prevent further illegal actions.
The provisions of the bill would be effective on the 180th day following enactment, except that the provision which authorizes a victim to file a police report would take effect immediately.
The bill passed the Committee by a vote of 5-0. It now goes to the full Senate for approval.