House Bill 881

AN ACT AUTHORIZING CERTAIN CONSUMERS TO PLACE A SECURITY FREEZE IN FILES MAINTAINED BY A CREDIT REPORTING AGENCY; TO PROVIDE FOR CERTAIN REQUIREMENTS AND PROCEDURES RELATING TO A SECURITY FREEZE; TO REQUIRE A CREDIT REPORTING AGENCY TO MAKE CERTAIN DISCLOSURES RELATING TO A SECURITY FREEZE; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. (1) On written request sent by certified mail that includes proper identification provided by a consumer and a copy of a valid police report, investigative report, or complaint which the consumer has filed with a law enforcement agency regarding the unlawful use of the personal information of the consumer by another person, 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.

(2) On written request for a security freeze provided by a consumer under subsection (1), 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. A reporting agency may charge a consumer a reasonable fee, not to exceed Ten Dollars ($10.00), to place a security freeze in his file.

(3) A consumer reporting agency shall, not later than the 10th business day after the date the agency receives the request for a security freeze:

(a) Send a written confirmation of the security freeze to the consumer; and

(b) 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 4 of this act.

(4) A consumer may request in writing a replacement personal identification number or password. The request must comply with the requirements for requesting a security freeze under subsection (1). The consumer reporting agency shall, not later than the third business day after the date the agency receives the request for a replacement personal identification number or password, provide the consumer with a new unique personal identification number or password to be used by the consumer instead of the number or password that was provided under subsection (3).

(5) As used in this section, the term "security freeze" means a notice that (a) prohibits a consumer reporting agency from releasing a consumer report relating to the extension of credit involving that consumer file, and (b) is placed in the file of a consumer at the consumer's request pursuant to subsection (1).

SECTION 2. 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 thirty (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.

SECTION 3. 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.

SECTION 4. (1) 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 1 of this act, a consumer reporting agency shall remove a security freeze not later than the third business day after the date the agency receives the request.

(2) 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 1 of this act, 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:

(a) A certain properly designated period; or

(b) A certain properly identified requester.

(3) 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.

(4) 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.

(5) A consumer reporting agency may not charge a fee for a request under subsection (1) or (2).

SECTION 5. A security freeze does not apply to a consumer report provided to:

(a) 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, subpoena, or administrative subpoena;

(b) An agency acting to investigate or collect child support payments or acting under Title IV-D of the Social Security Act (42 USCS Section 651 et seq.);

(d) A tax assessor-collector acting to investigate or collect delinquent ad valorem taxes;

(e) A person for the purposes of prescreening as provided by the Fair Credit Reporting Act (15 USCS Section 1681 et seq.), as amended, including a person setting or adjusting a rate, adjusting a claim, or underwriting for insurance purposes;

(f) 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, prospective assignee, or private collection agency, for purposes related to that account, contract or instrument;

(g) A subsidiary, affiliate, agent, assignee, or prospective assignee of a person to whom access has been granted under Section 4(2);

(h) A person who administers a credit file monitoring subscription service to which the consumer has subscribed;

(i) A person for the purpose of providing a consumer with a copy of the consumer's report on the consumer's request;

(j) A check service or fraud prevention service company that issues consumer reports:

(i) To prevent or investigate fraud; or

(ii) For purposes of approving or processing negotiable instruments, electronic funds transfers, or similar methods of payment;

(k) A deposit account information service company that issues consumer reports related to account closures caused by fraud, substantial overdrafts, automated teller machine abuses, or similar negative information regarding a consumer to an inquiring financial institution for use by the financial institution only in reviewing a consumer request for a deposit account with that institution; or

(l) A consumer reporting agency that:

(i) Acts only to resell credit information by assembling and merging information contained in a database of another consumer reporting agency or multiple consumer reporting agencies; and

(ii) Does not maintain a permanent database of credit information from which new consumer reports are produced.

SECTION 6. The requirement under this act to place a security alert or security freeze on a consumer file does not apply to:

(a) A check service or fraud prevention service company that issues consumer reports:

(i) To prevent or investigate fraud; or

(ii) For purposes of approving or processing negotiable instruments, electronic funds transfers, or similar methods of payment; or

(b) A deposit account information service company that issues consumer reports related to account closures caused by fraud, substantial overdrafts, automated teller machine abuses, or similar negative information regarding a consumer to an inquiring financial institution for use by the financial institution only in reviewing a consumer request for a deposit account with that institution.

SECTION 7. A consumer reporting agency shall honor a security freeze placed on a consumer file by another consumer reporting agency.

SECTION 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 his or her credit report to be accessed for that specific party or period of time, the third party may treat the application as incomplete.

SECTION 9. This act shall take effect and be in force from and after July 1, 2007.