TRENTON – Legislation sponsored by Senator Jeff Van Drew that would require debt collectors to cease debt collection against victims of identity theft was approved today by the Senate.
The bill, S-1344, would establish a process for a victim of identity theft to notify a debt collector of their status as such, and would require the debt collector to cease collection activities until a determination is made by the debt collector as to whether the consumer is in fact responsible for the debt in question.
“The impact of identity theft or fraud on its victims’ finances is often far-reaching and long-lasting. Unsuspecting consumers find themselves relentlessly chased by debt collectors for fraudulent charges that were made in their names without their knowledge as a result of their identity being stolen. This adds further insult to injury,” said Senator Van Drew (D-Atlantic/Cape May/Cumberland). “This legislation will provide added protections to consumers who have already fallen prey to the increasingly common crime of identity theft and provide them with recourse when they find themselves in this dire situation. Hopefully, this will give victims a small sense of security as they attempt to reclaim their lives.”
Under the bill, if a consumer informs a debt collector in writing that he or she is a victim of identity theft or misidentification within 45 days of the debt collector’s initial communication, a debt collector would cease collection activities upon receipt of that written statement until completion of a review as required under the bill. If the debt collector determines, in good faith, that the information establishes that the consumer is not responsible for the debt, the bill would require the debt collector to immediately cease all collection activities. If the information establishes that the consumer is indeed responsible for the debt, the bill would permit the debt collector to recommence debt collection activities.
The bill also details consequences for any violations to the act by either the consumer or the debt collector, and permits the Attorney General to enforce the provisions of the bill in such instances. It provides that an action to enforce any provision of the act must be filed in the appropriate court within one year from the date on which the violation occurred.
Other states, including New York, California, and Utah, have similar legislation whereby a victim of identity theft may submit an affidavit or a police report detailing the facts of their identity theft and its relation to the specific debt at issue.
The bill passed the Senate with a vote of 32-0. It next heads to the Assembly for consideration.