78R4182 RCJ-D
By: Ellis S.B. No. 473
A BILL TO BE ENTITLED
AN ACT
relating to assisting consumers to prevent and detect identity
theft.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 20.01, Business & Commerce Code, is
amended by adding Subdivisions (7) and (8) to read as follows:
(7) "Security alert" means a notice placed on a
consumer file that alerts a recipient of a consumer report
involving that consumer file that the consumer's identity may have
been used without the consumer's consent to fraudulently obtain
goods or services in the consumer's name.
(8) "Security freeze" means a notice placed on a
consumer file that prohibits a consumer reporting agency from
releasing a consumer report involving that consumer file without
the express authorization of the consumer.
SECTION 2. Section 20.03, Business & Commerce Code, is
amended by adding Subsection (d) to read as follows:
(d) Any written disclosure to a consumer by a consumer
reporting agency under this chapter must include a written
statement that explains in clear and simple language the consumer's
rights under this chapter and includes:
(1) the process for receiving a consumer report or
consumer file;
(2) the process for requesting or removing a security
alert or freeze;
(3) the toll–free telephone number for requesting a
security alert;
(4) applicable fees;
(5) dispute procedures;
(6) the process for correcting a consumer file or
report; and
(7) information on a consumer's right to bring an
action in court or arbitrate a dispute.
SECTION 3. Chapter 20, Business & Commerce Code, is amended
by adding Sections 20.031-20.038 to read as follows:
Sec. 20.031. REQUESTING SECURITY ALERT. On a request in
writing or by telephone and with proper identification provided by
a consumer, a consumer reporting agency shall place a security
alert on the consumer's consumer file not later than the fifth
business day after the date the agency receives the request. The
security alert must remain in effect for not less than 90 days after
the date the agency places the security alert on the file. There is
no limit on the number of security alerts a consumer may request.
At the end of a 90–day security alert, on request in writing or by
telephone and with proper identification provided by the consumer,
the agency shall provide the consumer with a copy of the consumer's
file.
Sec. 20.032. NOTIFICATION OF SECURITY ALERT. A consumer
reporting agency shall notify a person who requests a consumer
report if a security alert is in effect for the consumer file
involved in that report.
Sec. 20.033. TOLL-FREE SECURITY ALERT REQUEST NUMBER. A
consumer reporting agency shall maintain a toll-free telephone
number that is answered at all times to accept security alert
requests from consumers.
Sec. 20.034. REQUESTING SECURITY FREEZE. (a) On written
request sent by certified mail that includes proper identification
provided by a consumer, a consumer reporting agency shall place a
security freeze on a consumer's consumer file not later than the
fifth business day after the date the agency receives the request.
(b) On written request for a security freeze provided by a
consumer under Subsection (a), a consumer reporting agency shall
disclose to the consumer the process of placing, removing, and
temporarily lifting a security freeze and the process for allowing
access to information from the consumer's consumer file for a
specific requester or period while the security freeze is in
effect.
(c) A consumer reporting agency shall, not later than the
10th business day after the date the agency receives the request for
a security freeze:
(1) send a written confirmation of the security freeze
to the consumer; and
(2) provide the consumer with a unique personal
identification number or password to be used by the consumer to
authorize a removal or temporary lifting of the security freeze
under Section 20.037.
Sec. 20.035. NOTIFICATION OF CHANGE. If a security freeze
is in place, a consumer reporting agency shall notify the consumer
in writing of a change in the consumer file to the consumer's name,
date of birth, social security number, or address not later than 30
calendar days after the date the change is made. The agency shall
send notification of a change of address to the new address and
former address. This section does not require notice of an
immaterial change, including a street abbreviation change or
correction of a transposition of letters or misspelling of a word.
Sec. 20.036. NOTIFICATION OF SECURITY FREEZE. A consumer
reporting agency shall notify a person who requests a consumer
report if a security freeze is in effect for the consumer file
involved in that report.
Sec. 20.037. REMOVAL OR TEMPORARY LIFTING OF SECURITY
FREEZE. (a) On a request in writing or by telephone and with
proper identification provided by a consumer, including the
consumer's personal identification number or password provided
under Section 20.034, a consumer reporting agency shall remove a
security freeze not later than the third business day after the date
the agency receives the request.
(b) On a request in writing or by telephone and with proper
identification provided by a consumer, including the consumer's
personal identification number or password provided under Section
20.034, a consumer reporting agency, not later than the third
business day after the date the agency receives the request, shall
temporarily lift the security freeze for:
(1) a certain properly designated period; or
(2) a certain properly identified requester.
(c) A consumer reporting agency may develop procedures
involving the use of a telephone, a facsimile machine, the
Internet, or another electronic medium to receive and process a
request from a consumer under this section.
(d) A consumer reporting agency shall remove a security
freeze placed on a consumer file if the security freeze was placed
due to a material misrepresentation of fact by the consumer. The
consumer reporting agency shall notify the consumer in writing
before removing the security freeze under this subsection.
Sec. 20.038. EXEMPTION FROM SECURITY FREEZE. A security
freeze does not apply to a consumer report provided to:
(1) a state or local governmental entity, including a
law enforcement agency or court or private collection agency, if
the entity, agency, or court is acting under a court order, warrant,
or subpoena;
(2) a child support agency as defined by Section
101.004, Family Code, acting to investigate or collect child
support payments or acting under Title IV-D of the Social Security
Act (42 U.S.C. Section 651 et seq.);
(3) the Health and Human Services Commission acting
under Section 531.102, Government Code;
(4) the comptroller acting to investigate or collect
delinquent sales or franchise taxes;
(5) a tax assessor-collector acting to investigate or
collect delinquent ad valorem taxes;
(6) a person for the purposes of prescreening as
provided by the Fair Credit Reporting Act (15 U.S.C. Section 1681 et
seq.);
(7) a person with whom the consumer has an account or
contract or to whom the consumer has issued a negotiable
instrument, or the person's subsidiary, affiliate, agent,
assignee, or prospective assignee, for purposes related to that
account, contract, or instrument; or
(8) a subsidiary, affiliate, agent, assignee, or
prospective assignee of a person to whom access has been granted
under Section 20.037(b).
SECTION 4. Section 20.04, Business & Commerce Code, is
amended to read as follows:
Sec. 20.04. CHARGES FOR CERTAIN DISCLOSURES. (a) Except
as provided by Subsection (b), a consumer reporting agency may
impose a reasonable charge on a consumer for the disclosure of
information pertaining to the consumer, for placing a security
alert on a consumer file, or for placing a security freeze on a
consumer file. The amount of the charge may not exceed $8. On
January 1 of each year, a consumer reporting agency may increase the
charge for disclosure to a consumer, for placing a security alert,
or for placing a security freeze. The increase, if any, must be
based proportionally on changes to the Consumer Price Index for All
Urban Consumers as determined by the United States Department of
Labor with fractional changes rounded to the nearest 50 cents.
(b) A consumer reporting agency may not charge a fee for:
(1) a request by a consumer for a copy of the
consumer's file:
(A) made not later than the 60th day after the
date on which adverse action is taken against the consumer; or
(B) made on the expiration of a 90–day security
alert;
(2) notification of the deletion of information that
is found to be inaccurate or can no longer be verified sent to a
person designated by the consumer, as prescribed by Section 611 of
the Fair Credit Reporting Act (15 U.S.C. Section 1681i), as
amended;
(3) a set of instructions for understanding the
information presented on the consumer report; [or]
(4) a toll-free telephone number that consumers may
call to obtain additional assistance concerning the consumer report
or to request a security alert; or
(5) a request for a security freeze made by a consumer
who has submitted to the consumer reporting agency a copy of a valid
police report, investigative report, or complaint made under
Section 32.51, Penal Code.
SECTION 5. Subchapter D, Chapter 35, Business & Commerce
Code, is amended by adding Section 35.58 to read as follows:
Sec. 35.58. CONFIDENTIALITY OF SOCIAL SECURITY
NUMBER. (a) A person, other than government or a governmental
subdivision or agency, may not:
(1) intentionally communicate or otherwise make
available to the public an individual's social security number;
(2) display an individual's social security number on
a card or other device required to access a product or service
provided by the person;
(3) require an individual to transmit the individual's
social security number over the Internet unless the connection with
the Internet is secure or the number is encrypted;
(4) require an individual's social security number for
access to an Internet website, unless a password or unique personal
identification number or other authentication device is also
required for access; or
(5) print an individual's social security number on
any materials, other than a form or application, that are sent by
mail, unless state or federal law requires that the individual's
social security number be included in the materials.
(b) A person that is using an individual's social security
number before January 1, 2004, in a manner prohibited by Subsection
(a) may continue that use if:
(1) the use is continuous; and
(2) the person provides annual disclosure to the
individual stating that on written request from the individual the
person will cease to use the individual's social security number in
a manner prohibited by Subsection (a).
(c) A person, other than government or a governmental
subdivision or agency, may not deny services to an individual
because the individual makes a written request under Subsection
(b).
(d) This section does not apply to:
(1) the collection, use, or release of a social
security number that is required by state or federal law, including
Chapter 552, Government Code; or
(2) the use of a social security number for internal
verification or administrative purposes.
SECTION 6. (a) Except as provided by Subsection (b) of this
section, this Act takes effect September 1, 2003.
(b) Section 35.58, Business & Commerce Code, as added by
this Act, takes effect January 1, 2004.