February 17, 1999

WILKERSON PREFILES IDENTITY THEFT LEGISLATION

    State Rep. Pinkie Wilkerson, D-Grambling, has prefiled legislation (House Bill 194) which makes the unauthorized use of personal identity a state crime and imposes penalties against the convicted.

    Identity theft is a fraudulent scheme to use someone else's personal identification information such as their name, social security number, driver's license number, armed forces identification number, bank account, credit card number or other information in order to obtain anything of value. Thieves can assume someone's identity through pre-approved credit applications and accessing personal information stored in computer databases, as well as actual physical theft.

    At this time only nine states have identity theft laws on the books and recognize the consumer as a victim of this type of crime. All other states consider the creditor to be the victim because they incur most, if not all, of the financial loss. Law enforcement officials cannot even file a report on behalf of the consumer who has been victimized in states where there is no law against this crime.

    Wilkerson explained, "Currently banks and financial institutions are seen as the only victims because they incur the financial loss. An additional victim, however, is the person who has their identity assumed by someone else or has checks or credit cards stolen. They are also the victim because they have to prove the theft and go through all of the red tape to ensure that their credit rating is not damaged and, unfortunately, in most cases it is. They are also responsible, under federal law, for $50 per account for credit card and banking fraud. Further, the financial institution, who is the only party who is the legal victim and can legally do something about this is not responsible for protecting the consumer or correcting damaged credit reports. So, you see, the person who has their identity or property stolen is an additional victim who also needs protection."

    The Bureau of Consumer Protection, Federal Trade Commission, agrees with Wilkerson's concerns. They indicate that "It is often difficult for consumers to cleanse their credit reports of the perpetrator's bad acts. Victims must go through the time-consuming process of (1) trying to prove to lenders and credit reporting agencies that they were in fact victimized by identity theft and did not personally incur or authorize the perpetrator's charges; (2) having the erroneous information removed from their credit report; and (3) preventing the perpetrators' future activities from further damaging their records."

    Another problem involving this crime is that financial institutions who, again, are the only legal victims, usually do not pursue the criminal because the losses do not justify the expenses for prosecuting. Therefore, there is little deterrent to committing these types of crimes. Wilkerson said her proposed law will help alleviate this problem, as well.

    Wilkerson's legislation provides a penalty of a fine of up to $2,000, or imprisonment, with or without hard labor, for up to two years, or both. Additionally, the court, in its discretion, may require restitution for any loss associated with the offense.

    Wilkerson said this law will not preempt the federal law but should complement it by increasing awareness of the crime. The federal law was designed to assist federal law enforcement officials bring those involved in organized crime rings to justice, not to deal with individual identity theft.