SECOND REGULAR SESSION
93RD GENERAL ASSEMBLY
INTRODUCED BY REPRESENTATIVE YATES.
Read 1st time January 31, 2006 and copies ordered printed.
STEPHEN S. DAVIS, Chief Clerk
AN ACT
To amend chapter 407, RSMo, by adding thereto five new sections relating to consumer credit reports.
Be it enacted by the General Assembly of the state of Missouri, as follows:
Section A. Chapter 407, RSMo, is amended by adding thereto five new sections, to be known as sections 407.1500, 407.1503, 407.1506, 407.1509, and 407.1512, to read as follows:
407.1500. 1. A consumer may elect to place a security alert in his or her consumer credit report by making a request in writing or by telephone to a consumer credit reporting agency. "Security alert" means a notice placed in a consumer's credit report, at the request of the consumer, that notifies a recipient of the credit report 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.
2. A consumer credit reporting agency shall notify each person requesting consumer credit information with respect to a consumer of the existence of a security alert in the credit report of that consumer, regardless of whether a full credit report, credit score, or summary report is requested.
3. Each consumer credit reporting agency shall maintain a toll-free telephone number to accept security alert requests from consumers twenty-four hours a day, seven days a week.
4. The toll-free telephone number shall be included in any written disclosure by a consumer credit reporting agency to any consumer and shall be printed in a clear and conspicuous manner.
5. A consumer credit reporting agency shall place a security alert on a consumer's credit report no later than five business days after receiving a request from the consumer.
6. The security alert shall remain in place for at least ninety days and a consumer shall have the right to request a renewal of the security alert.
7. Any person who uses a consumer credit report in connection with the approval of credit based on an application for an extension of credit, or with the purchase, lease, or rental of goods or noncredit-related services and who receives notification of a security alert under subsection 1 of this section shall not lend money, extend credit, or complete the purchase, lease, or rental of goods or noncredit-related services without taking reasonable steps to verify the consumer's identity to ensure that the application for an extension of credit or for the purchase, lease, or rental of goods or noncredit-related services is not the result of identity theft. If the consumer has placed a statement with the security alert in his or her file requesting that identity be verified by calling a specified telephone number, any person who receives that statement with the security alert in a consumer's file under subsection 1 of this section shall take reasonable steps to verify the identity of the consumer by contacting the consumer using the specified telephone number prior to lending money, extending credit, or completing the purchase, lease, or rental of goods or noncredit-related services. If a person uses a consumer credit report to facilitate the extension of credit or for another permissible purpose on behalf of a subsidiary, affiliate, agent, assignee, or prospective assignee, such person may verify a consumer's identity under this section in lieu of the subsidiary, affiliate, agent, assignee, or prospective assignee.
8. For purposes of this section, "extension of credit" does not include an increase in the dollar limit of an existing open-end credit plan, as defined in Regulation Z issued by the Board of Governors of the Federal Reserve System (12 C.F.R. 226.2), or any change to, or review of, an existing credit account.
9. If reasonable steps are taken to verify the identity of the consumer, such steps constitute compliance with the requirements of this section; except that, if a consumer has placed a statement including a telephone number with the security alert in his or her file, the consumer's identity shall be verified by contacting the consumer using that telephone number as specified in subsection 7 of this section.
10. A consumer credit reporting agency shall notify each consumer who has requested that a security alert be placed on his or her consumer credit report of the expiration date of the alert.
11. Any consumer credit reporting agency that recklessly, willfully, or intentionally fails to place a security alert under this section shall be liable for a penalty in an amount of up to two thousand five hundred dollars and reasonable attorneys' fees.
407.1503. 1. A consumer may elect to place a security freeze on his or her credit report by making a request in writing by certified mail to a consumer credit reporting agency. "Security freeze" means a notice placed in a consumer's credit report, at the request of the consumer and subject to certain exceptions, that prohibits the consumer credit reporting agency from releasing the consumer's credit report or any information from it without the express authorization of the consumer. If a security freeze is in place, information from a consumer's credit report may not be released to a third party without prior express authorization from the consumer. Nothing in this subsection shall prevent a consumer credit 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 credit reporting agency shall place a security freeze on a consumer's credit report no later than five business days after receiving a written request from the consumer.
3. The consumer credit reporting agency shall send a written confirmation of the security freeze to the consumer within ten business days and shall provide the consumer with a unique personal identification number or password to be used by the consumer when providing authorization for the release of his or her credit for a specific party or period of time.
4. If the consumer wishes to allow his or her credit report to be accessed for a specific party or period of time while a freeze is in place, the consumer shall contact the consumer credit reporting agency, request that the freeze be temporarily lifted, and provide the following:
(1) Proper identification;
(2) The unique personal identification number or password provided by the credit reporting agency under subsection 3 of this section; and
(3) The proper information regarding the third party who is to receive the credit report or the time period for which the report shall be available to users of the credit report.
5. A consumer credit 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 business days after receiving the request.
6. A consumer credit reporting agency may develop procedures involving the use of telephone, facsimile, 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.
7. A consumer credit reporting agency shall remove or temporarily lift a freeze placed on a consumer's credit report only in the following cases:
(1) Upon consumer request, under subsection 4 or 10 of this section;
(2) If the consumer's credit report was frozen due to a material misrepresentation of fact by the consumer. If a consumer credit reporting agency intends to remove a freeze upon a consumer's credit report under this subdivision, the consumer credit 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 such 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 such specific party or period of time, the third party may treat the application as incomplete.
9. If a consumer requests a security freeze, the consumer credit reporting agency shall disclose the process of placing and temporarily lifting a freeze, and the process for allowing access to information from the consumer's credit report for a specific party or period of time while the freeze is in place.
10. A security freeze shall remain in place until the consumer requests that the security freeze be removed. A consumer credit reporting agency shall remove a security freeze within three business days of receiving a request for removal from the consumer who provides both of the following:
(1) Proper identification; and
(2) The unique personal identification number or password provided by the credit reporting agency under subsection 3 of this section.
11. A consumer credit 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:
(1) A person or entity, or a subsidiary, affiliate, or agent of such person or entity, or an assignee of a financial obligation owing by the consumer to such person or entity, or a prospective assignee of a financial obligation owing by the consumer to such person or entity in conjunction with the proposed purchase of the financial obligation with which the consumer has or had prior to assignment an account or contract, including a demand deposit account, or to whom the consumer issued a negotiable instrument for the purposes of reviewing the account or collecting the financial obligation owing for the account, contract, or negotiable instrument. For purposes of this subdivision, "reviewing the account" includes activities related to account maintenance, monitoring, credit line increases, and account upgrades and enhancements;
(2) 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;
(3) Any state or local agency, law enforcement agency, court, or private collection agency acting under a court order, warrant, or subpoena;
(4) A child support enforcement agency acting under chapter 454, RSMo, or Title IV-D of the Social Security Act (42 U.S.C. et seq.);
(5) The attorney general or department of social services, or its agents or assigns, acting to investigate Medicaid fraud;
(6) The department of revenue acting to investigate or collect delinquent taxes or to fulfill any of its other statutory responsibilities;
(7) The use of credit information for the purposes of prescreening as provided for by the federal Fair Credit Reporting Act;
(8) Any person or entity administering a credit file monitoring subscription service to which the consumer has subscribed;
(9) Any person or entity for the purpose of providing a consumer with a copy of his or her credit report upon the consumer's request.
13. Nothing in this section shall be construed as preventing a consumer credit reporting agency from charging a fee of no more than ten dollars to a consumer for each freeze, removal of the freeze, or temporary lift of the freeze for a period of time, or a fee of no more than twelve dollars for a temporary lift of a freeze for a specific party, regarding access to a consumer credit report.
14. As used in this section, "proper identification" means information generally deemed sufficient to identify a person.
407.1506. 1. If a security freeze is in place, a consumer credit reporting agency shall not change any of the following official information in a consumer credit report without sending a written confirmation of the change to the consumer within thirty days of the change being posted to the consumer's file: name, date of birth, Social Security number, and address. Written confirmation shall not be 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 to the former address.
2. If a consumer has placed a security alert, a consumer credit reporting agency shall provide the consumer, upon request, with a free copy of his or her credit report at the time the ninety-day security alert period expires.
407.1509. The following entities are not required to place in a credit report either a security alert under section 407.1500 or a security freeze under section 407.1503:
(1) A check services or fraud prevention services company which issues reports on incidents of fraud or authorizations for the purpose of approving or processing negotiable instruments, electronic funds transfers, or similar methods of payments;
(2) A deposit account information service company which issues reports regarding account closures due to fraud, substantial overdrafts, ATM abuse, or 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.
407.1512. 1. In addition to any other rights the consumer may have under sections 407.1500 to 407.1512, every consumer credit reporting agency after being contacted by telephone, mail, or in person by any consumer who has reason to believe he or she may be a victim of identity theft shall promptly provide to such consumer a statement, written in a clear and conspicuous manner, describing the statutory rights of victims of identity theft under state and federal law.
2. Upon the receipt from a victim of identity theft of a police report of identity theft, every consumer credit reporting agency shall provide the victim, free of charge and upon request, with up to twelve copies of the consumer's file during a consecutive twelve-month period, not to exceed one copy per month, following the date of the police report. Notwithstanding any other provision of law to the contrary, the maximum number of free reports a victim of identity theft is entitled to obtain under this section is twelve per year, as provided by this subsection.
3. Subsection 1 of this section shall not apply to a consumer reporting agency that acts only as a reseller of credit information by assembling and merging information contained in the database of another consumer reporting agency or agencies and that does not maintain a permanent database of credit information from which new credit reports are produced.
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