2007 Regular Session
To: Banking and Financial Services
By: Representative Guice
AN ACT TO AUTHORIZE A CONSUMER TO PLACE A SECURITY FREEZE ON HIS OR HER CREDIT REPORT, WHICH WILL PROHIBIT A CONSUMER REPORTING AGENCY FROM RELEASING THE CONSUMER'S CREDIT REPORT OR ANY INFORMATION FROM IT WITHOUT THE EXPRESS AUTHORIZATION OF THE CONSUMER; TO REQUIRE CONSUMER REPORTING AGENCIES TO PLACE A SECURITY FREEZE ON A CONSUMER'S CREDIT REPORT WITHIN FIVE BUSINESS DAYS AFTER RECEIVING A WRITTEN REQUEST FROM THE CONSUMER; TO PROVIDE THAT A SECURITY FREEZE WILL REMAIN IN PLACE UNTIL THE CONSUMER REQUESTS THAT THE SECURITY FREEZE BE REMOVED; TO REQUIRE CONSUMER REPORTING AGENCIES TO REMOVE A SECURITY FREEZE WITHIN THREE BUSINESS DAYS OF RECEIVING A REQUEST FOR REMOVAL FROM THE CONSUMER; TO PROVIDE FOR CERTAIN EXCEPTIONS TO THE REQUIREMENTS OF THIS ACT; TO PROVIDE THAT ANY PERSON WHOSE PROPERTY OR PERSON IS INJURED BY REASON OF A VIOLATION OF THIS ACT MAY SUE FOR CIVIL DAMAGES; TO AMEND SECTION 75-24-5, MISSISSIPPI CODE OF 1972, TO CONFORM TO THE PRECEDING PROVISIONS; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. As used in this act, the following words shall be defined as provided in this section:
(a) "Consumer" means an individual.
(b) "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.
(c) "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, character, general reputation, personal characteristics, or mode of living that 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:
(i) Credit to be used primarily for personal, family, or household purposes.
(ii) Employment purposes.
(iii) Any other purpose authorized under 15 USCS Section 1681(b).
(d) "Credit card" has the same meaning as in Section 103 of the Truth in Lending Act (15 USCS Section 160 et seq.).
(e) "Person" means any individual, partnership, corporation, trust, estate, cooperative, association, government, or governmental subdivision or agency, or other entity.
(f) "Proper identification" means information generally deemed sufficient to identify a person. If a person is unable to reasonably identify himself or herself with the information described above, a consumer reporting agency may require additional information concerning the consumer's employment and personal or family history in order to verify the consumer's identity.
(g) "Security freeze" means notice placed in a credit report, at the request of the consumer and subject to certain exceptions, that prohibits the consumer reporting agency from releasing all or any part of the consumer's credit report or any information derived from it without the express authorization of the consumer.
SECTION 2. (1) A consumer may place a security freeze on the consumer's credit report by making a request in writing by certified mail to a consumer reporting agency. A security freeze shall prohibit, subject to exceptions in subsection (12) of this section, the consumer reporting agency from releasing the consumer's credit report or any information from it without the express authorization of the consumer. When a security freeze is in place, a consumer reporting agency may not release the consumer's credit report or information to a third party without prior express authorization from the consumer. This subsection does not prevent a consumer reporting agency from advising a third party that a security freeze is in effect with respect to the consumer's credit report.
(2) A consumer reporting agency shall place a security freeze on a consumer's credit report no later than five (5) business days after receiving a written request from the consumer.
(3) The consumer reporting agency shall send a written confirmation of the security freeze to the consumer within ten (10) business days of placing the freeze and at the same time shall provide the consumer with a unique personal identification number or password, other than the consumer's social security number, to be used by the consumer when providing authorization for the release of the consumer's credit report for a specific period of time.
(4) If the consumer wishes to allow the consumer's credit report to be accessed for a specific period of time while a freeze is in place, the consumer shall contact the consumer reporting agency, request that the freeze be temporarily lifted, and provide all of the following:
(a) Proper identification;
(b) The unique personal identification number or password provided by the consumer reporting agency under subsection (3) of this section; and
(c) The proper information regarding the time period for which the report shall be available to users of the credit report.
(5) A consumer reporting agency may develop procedures involving the use of telephone, fax, the Internet, or other electronic media to receive and process a request from a consumer to temporarily lift a freeze on a credit report under subsection (4) of this section in an expedited manner.
(6) A consumer reporting agency that receives a request from a consumer to temporarily lift a freeze on a credit report under subsection (4) of this section shall comply with the request no later than three (3) business days after receiving the request.
(7) A consumer reporting agency shall remove or temporarily lift a freeze placed on a consumer's credit report only in the following cases:
(a) Upon the consumer's request, under subsection (4) or (10) of this section; or
(b) If the consumer's credit report was frozen due to a material misrepresentation of fact by the consumer. If a consumer reporting agency intends to remove a freeze upon a consumer's credit report under this paragraph, the consumer reporting agency shall notify the consumer in writing prior to removing the freeze on the consumer's credit report.
(8) If a third party requests access to a consumer credit report on which a security freeze is in effect and this request is in connection with an application for credit or any other use and the consumer does not allow the consumer's credit report to be accessed for that specific period of time, the third party may treat the application as incomplete.
(9) If a consumer requests a security freeze under this section, the consumer reporting agency shall disclose to the consumer the process of placing and temporarily lifting a security freeze and the process for allowing access to information from the consumer's credit report for a specific period of time while the security freeze is in place.
(10) 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 (3) business days of receiving a request for removal from the consumer, who provides all of the following:
(a) Proper identification; and
(b) The unique personal identification number or password provided by the consumer reporting agency under subsection (3) of this section.
(11) A consumer reporting agency shall require proper identification of the person making a request to place or remove a security freeze.
(12) The provisions of this section do not apply to the use of a consumer credit report by any of the following:
(a) A person, or the person's subsidiary, affiliate, agent, subcontractor, or assignee with whom the consumer has, or prior to assignment had, an account, contract, or debtor-creditor relationship for the purposes of reviewing the active account or collecting the financial obligation owing for the account, contract, or debt;
(b) A subsidiary, affiliate, agent, assignee, or prospective assignee of a person to whom access has been granted under subsection (4) of this section for purposes of facilitating the extension of credit or other permissible use;
(c) Any person acting under a court order, warrant, or subpoena;
(d) A state or local agency, or its agents or assigns, that administers a program for establishing and enforcing child support obligations;
(e) A state or local agency, or its agents or assigns, acting to investigate fraud, including Medicaid fraud, or acting to investigate or collect delinquent taxes or assessments, including interest and penalties, unpaid court orders, or to fulfill any of its other statutory responsibilities;
(f) A federal, state, or local governmental entity, including law enforcement agency, court, or their agent or assigns;
(g) A person for the purposes of prescreening as defined by the Fair Credit Reporting Act, 15 USCS Section 1681(b) et seq.;
(h) Any person for the sole purpose of providing for a credit file monitoring subscription service to which the consumer has subscribed;
(i) A consumer reporting agency for the purpose of providing a consumer with a copy of the consumer's credit report upon the consumer's request;
(j) Any depository financial institution for checking, savings, and investment accounts; or
(k) Any property and casualty insurance company for use in setting or adjusting a rate, adjusting a claim, or underwriting for property and casualty insurance purposes.
(13) If a security freeze is in place, a consumer reporting agency shall not change any of the following official information in a credit report without sending a written confirmation of the change to the consumer within thirty (30) days of the change being posted to the consumer's file: name, date of birth, social security number, and address. Written confirmation is not required for technical modifications of a consumer's official information, including name and street abbreviations, complete spellings, or transposition of numbers or letters. In the case of an address change, the written confirmation shall be sent to both the new address and the former address.
(14) The following persons are not required to place in a credit report a security freeze under this section, except that any person that is not required to place a security freeze on a credit report under the provisions of paragraph (c) of this subsection shall be subject to any security freeze placed on a credit report by another consumer reporting agency from which it obtains information:
(a) A check services or fraud prevention services company that reports on incidents of fraud or issues authorizations for the purpose of approving or processing negotiable instruments, electronic fund transfers, or similar methods of payment.
(b) A deposit account information service company that issues reports regarding account closures due to fraud, substantial overdrafts, ATM abuse, or other similar negative information regarding a consumer to inquiring banks or other financial institutions for use only in reviewing a consumer request for a deposit account at the inquiring bank or financial institution; or
(c) A consumer reporting agency that does all of the following:
(i) Acts only to resell credit information by assembling and merging information contained in a database of one or more credit reporting agencies; and
(ii) Does not maintain a permanent database of credit information from which new credit reports are produced.
(15) This section does not prevent a consumer reporting agency from charging a fee of no more than Ten Dollars ($10.00) to a consumer for each freeze, removal of the freeze, or temporary lifting of the freeze for a period of time, regarding access to a consumer credit report, except that a consumer reporting agency may not charge any fee to a victim of identity theft who has submitted a copy of a valid investigative or incident report or complaint with a law enforcement agency about the unlawful use of the victim's identifying information by another person.
(16) At any time that a consumer is required to receive a summary of rights required under Section 609 of the federal Fair Credit Reporting Act, the following notice shall be included:
"Mississippi Consumers Have the Right to Obtain a Security Freeze.
You have a right to place a "security freeze" on your credit report under Mississippi law. The security freeze will prohibit a consumer reporting agency from releasing any information in your credit report without your express authorization. A security freeze must be requested in writing by certified mail.
The security freeze is designed to prevent credit, loans, and services from being approved in your name without your consent. However, you should be aware that using a security freeze to take control over who gains access to the personal and financial information in your credit report may delay, interfere with, or prohibit the timely approval of any later request or application you make regarding new loans, credit, mortgage, insurance, rental housing, employment, investment, license, cellular phone, utilities, digital signature, Internet credit card transactions, or other services, including an extension of credit at point of sale.
The freeze will be placed within five (5) business days. When you place a security freeze on your credit report, within ten (10) business days, you will be provided a personal identification number or a password to use when you want to remove or lift temporarily the security freeze.
A freeze does not apply when you have an existing account relationship and a copy of your report is requested by your existing creditor or its agents or affiliates for certain types of account review, collection, fraud control, or similar activities.
You should plan ahead and lift a freeze if you are actively seeking credit or services as a security freeze may slow your applications, as mentioned above.
You can remove a freeze or authorize temporary access for a specific period of time by contacting the consumer reporting agency and providing all of the following:
(1) Your personal identification number or password;
(2) Proper identification to verify your identity; and
(3) Proper information regarding the period of time you want your report available to users of the credit report.
A consumer reporting agency that receives a request from you to temporarily lift a freeze on a credit report shall comply with the request no later than three (3) business days after receiving the request. A consumer reporting agency may charge you up to Ten Dollars ($10.00) for each time you freeze, remove the freeze, or temporarily lift the freeze for a period of time, except a consumer reporting agency may not charge any amount to a victim of identify theft who has submitted a copy of a valid investigative or incident report or complaint with a law enforcement agency about the unlawful use of the victim's identifying information by another person.
You have a right to bring a civil action against someone who violates your rights under the credit reporting laws. The action can be brought against a consumer reporting agency or a user of your credit report."
(17) A violation of this section is a violation of Section 75-24-5.
SECTION 3. (1) Any person whose property or person is injured by reason of an act made unlawful by Section 2 of this act may sue for civil damages. Damages may be in an amount of up to Five Thousand Dollars ($5,000.00) but no less than Five Hundred Dollars ($500.00) for each incident, or three (3) times the amount of actual damages, whichever amount is greater. A person seeking damages as set forth in this section also may institute a civil action to enjoin and restrain future acts that would constitute a violation of this section. The court, in an action brought under this section, may award reasonable attorneys' fees to the prevailing party.
SECTION 4. Section 75-24-5, Mississippi Code of 1972, is amended as follows:
75-24-5. (1) Unfair methods of competition affecting commerce and unfair or deceptive trade practices in or affecting commerce are prohibited. Action may be brought under Section 75-24-5(1) only under the provisions of Section 75-24-9.
(2) Without limiting the scope of subsection (1) of this section, the following unfair methods of competition and unfair or deceptive trade practices or acts in the conduct of any trade or commerce are * * * prohibited:
(a) Passing off goods or services as those of another;
(b) Misrepresentation of the source, sponsorship, approval, or certification of goods or services;
(c) Misrepresentation of affiliation, connection, or association with, or certification by another;
(d) Misrepresentation of designations of geographic origin in connection with goods or services;
(e) Representing that goods or services have sponsorship, approval, characteristics, ingredients, uses, benefits, or quantities that they do not have or that a person has a sponsorship, approval, status, affiliation, or connection that he does not have;
(f) Representing that goods are original or new if they are reconditioned, reclaimed, used, or secondhand;
(g) Representing that goods or services are of a particular standard, quality, or grade, or that goods are of a particular style or model, if they are of another;
(h) Disparaging the goods, services, or business of another by false or misleading representation of fact;
(i) Advertising goods or services with intent not to sell them as advertised;
(j) Advertising goods or services with intent not to supply reasonably expectable public demand, unless the advertisement discloses a limitation of quantity;
(k) Misrepresentations of fact concerning the reasons for, existence of, or amounts of price reductions;
(l) Advertising by or on behalf of any licensed or regulated health care professional which does not specifically describe the license or qualifications of the licensed or regulated health care professional;
(m) Charging an increased premium for reinstating a motor vehicle insurance policy that was cancelled or suspended by the insured solely for the reason that he was transferred out of this state while serving in the United States Armed Forces or on active duty in the National Guard or United States Armed Forces Reserve. It is also an unfair practice for an insurer to charge an increased premium for a new motor vehicle insurance policy if the applicant for coverage or his covered dependents were previously insured with a different insurer and canceled that policy solely for the reason that he was transferred out of this state while serving in the United States Armed Forces or on active duty in the National Guard or United States Armed Forces Reserve. For purposes of determining premiums, an insurer shall consider such persons as having maintained continuous coverage. The provisions of this paragraph (m) shall apply only to such instances when the insured does not drive the vehicle during the period of cancellation or suspension of his policy;
(n) Any violation of Section 2 of this act.
SECTION 5. This act shall stand repealed after July 1, 2009.
SECTION 6. This act shall take effect and be in force from and after July 1, 2007.