WASHINGTON, DC - In an effort to strengthen consumer credit reporting rights, U.S. Senator Jack Reed (D-RI) introduced the Control Your Personal Credit Information Act (S. 2362), which seeks to give consumers greater control over when and how their consumer reports are shared by consumer reporting agencies.

Credit reports play a crucial role in Americans’ lives, as most creditors use them to help determine whether to extend credit and at what rate. 

“But under existing law, the current consumer reporting system is backwards.  Consumer reporting agencies collect so much information on us, often without our consent, so at the very least, they should ask us for our permission before they share or sell our information” stated Reed, a senior member of the Senate Banking Committee.  “The Control Your Personal Credit Information Act would fix the current upside down system by giving consumers greater control -- at no cost to the consumer -- over when and how their information is released when applying for new credit, a loan, or insurance.”

Reed cited Equifax’s failure to secure troves of valuable personally identifiable information it collected on over 145 million Americans as an example of why the current system is inadequate and must change.  Indeed, the National Consumer Law Center’s Chi Chi Wu stated in her October 2017 testimony before the House Financial Services Committee that the Equifax breach “means half of the U.S. population and nearly three-quarters of the consumers with active credit reports are now at risk of identity theft due to one of the worst – if not the worst – breaches of consumer data in American history.  These Americans are at risk of having false new credit accounts, phony tax returns, and even spurious medical bills incurred in their good names.” 

To make matters worse, the risks of identity fraud may not dissipate over time because as Ed Mierzwinski, U.S. PIRG’s federal Consumer Program Director, points out: “unlike credit card numbers, your Social Security Number and Date of Birth don’t change and may even grow more valuable over time, like gold in a bank vault. Much worse, they are the keys to ‘new account identity theft.”

Under Reed’s legislation, consumer reporting agencies must confirm a consumer’s identity and obtain their written authorization before releasing consumer reports in the instances that are especially vulnerable to identity theft and fraud.  In addition, the Control Your Personal Credit Information Act would require every consumer reporting agency to take appropriate steps to prevent unauthorized access to the consumer reports and personal information they maintain.  

“At least one member of the credit reporting industry has been careless with people’s data, and it’s past time to reform the credit reporting system.  These steps are designed to help safeguard consumers’ private information by giving consumers greater control over their own information while making it tougher for criminals to fraudulently open new credit or insurance accounts in other people’s names,” said Reed.

“This bill puts consumers firmly in control when someone wants to access their credit reports in connection with an application for a loan or insurance,” said Susan Grant, Director of Consumer Protection and Privacy at Consumer Federation of America. “Even if the consumers haven’t put freezes on their credit reports, they would be protected because the credit reporting agencies would have to get their OK before releasing that sensitive personal data.”       

The Control Your Personal Credit Information Act is supported by the National Consumer Law Center (on behalf of its low-income clients), U.S. PIRG, Americans for Financial Reform, Public Citizen, Consumer Federation of America, and Consumers Union.

The full text of the bill may be found here.