Schumer To Credit Bureaus: Make Consumer Credit "Freezes" Free And Automated
Press Release
Schumer To Credit Bureaus: Make Consumer Credit "Freezes" Free And Automated
U.S. Senator Charles E. Schumer announced today that he was demanding that the three major credit bureaus eliminate all fees and restrictions placed on consumers seeking to block unwanted access to their credit reports. The Senator said he may offer legislation requiring the bureaus to do so if they do not act voluntarily.
In separate letters released today to the CEOs of Experian, TransUnion, and Equifax, Schumer praised the companies for agreeing recently to allow consumers to place so-called "freezes" on their credit histories. A freeze puts a consumer's credit report under lockdown, preventing any access into credit records and scores without the consumer's knowledge and consent. But Schumer said that charging fees for the activation and de-activation of those freezesas well as the mail-based system for processing the requestsplaces too heavy a burden on consumers interested in guarding against identity theft and hinders legitimate lending transactions.
Currently, the companies have said that they will only allow consumers who can prove they have already been the victims of identify theft to freeze their credit report for free. Otherwise, consumers will be charged around $10 to place a freeze per credit bureau, with additional fees levied each time the consumer wishes to lift or restore the freeze. Because a consumer would have to place the freeze at each of the three major credit bureaus, it would cost $30 just to initiate the freeze.
"Credit freezes should frustrate identity thieves, not the consumers they are meant to protect," Schumer said. "Freezes need to be freely available to consumers before they become identity theft victims, not just after. This type of protection should be free of charge and available at the click of a mouse."
While a majority of states have laws on the books that permit freezes, rules differ from state to state and there is currently no federal law that deals with the issue of credit freezes. In his letters to the credit bureaus, Schumer disclosed he was considering legislation on the issue, but expressed hope the bureaus could make that unnecessary by taking four steps on their own:
· Allow customers to request a freeze either by mail, online or by phone. Currently, the bureaus require a request to come via certified mail, which is a time-consuming hassle for consumers and does nothing to help the bureaus verify a requester's identity.
· Eliminate fees for freeze requests, lifts, and removals.
· Make the freezes go into effect, and allow them to be lifted, as close to instantaneously as possible. Currently, there is a lag time associated with most requests because of the certified mail requirement.
· Require the bureaus to share freeze requests among themselves, so a consumer need only notify one bureau instead of all three.
Schumer said making freezes free and easy would benefit consumers and creditors alike.
"Consumers should be able to suspend unwanted access to their credit records for any reason, without facing repeated fees," Schumer said in the letters. "It makes even less sense to charge consumers for lifting or removing a credit freeze given that unfettered access to credit information benefits both consumers and lenders."
Copies of the three letters appear below.
Harry C. Gambill, CEO
TransUnion
555 West Adams Street
Chicago, IL 60661
Dear Mr. Gambill:
I write to urge TransUnion to adopt changes to its credit freeze policy in order to protect consumers better from identity theft. I applaud TransUnion's recent decision to allow consumers nationwide to place credit freezes on their files. Credit freezes that suspend access to credit reports and scores without the consumer's consent can be valuable tools to stop or prevent the ravages of identity theft. However, I am concerned that TransUnion intends to require consumers to initiate freezes through certified mail. I am also disappointed that TransUnion plans to charge consumers $10 for initiating, lifting or removing a freeze, unless they are identity theft victims.
I am calling on TransUnion, and the other two leading credit bureaus, to protect consumers by making four simple, sensible changes to its credit freeze policies. Consumers are rightly concerned about the risk of identity theft, and credit reporting should foster trust by providing easy access to credit freezes for consumers who fear that their information will be misused.
First, TransUnion should allow all consumers to request or lift a freeze by telephone, online, or through first-class mail, at the election of the consumer. Certified mail does not provide any additional assurance of the requester's identity, yet the additional time and expense of using certified mail may dissuade consumers who need credit freezes from protecting themselves.
Second, TransUnion should not charge any fee for placing, temporarily lifting, or removing a credit freeze. It is not just the known victim of identity theft who may wish to protect her private information with a credit freeze, but also the traveler who has lost her pocketbook in the airport, the elderly veteran who mistakenly gave out information to a stranger, or the consumer whose information was exposed in a data security breach. Consumers should be able to suspend unwanted access to their credit records for any reason, without facing repeated fees. It makes even less sense to charge consumers for lifting or removing a credit freeze given that unfettered access to credit information benefits both consumers and lenders.
Third, TransUnion should immediately implement a consumer request to place, lift and remove a credit freeze. No consumer should have to stand by and wait for a credit freeze to be processed while a thief exploits that consumer's good name. Moreover, as long as the requester's identity is verified, quick lifting of freezes will facilitate legitimate lending and borrowing without harming data privacy. Thus, a telephone or electronic request for changes to a consumer's freeze status should be made within minutes of the request being received.
Finally, now that all three major bureaus intend to offer credit freezes, TransUnion should transmit any consumer's request for a credit freeze to the other two bureaus, as is currently done with fraud alerts. Using the same procedures developed for fraud alerts, consumers should be able to make a single request to freeze their files at all bureaus. Sharing freeze requests among the credit reporting agencies is more efficient for all parties and will ensure that consumers do not unwittingly leave the door open to identity theft by placing a freeze at only one bureau.
In addition to contacting TransUnion, I am making these same four requests of the other leading credit bureaus. It is my hope that all the bureaus will promptly adopt these reforms. However, I am also prepared to consider introducing legislation to protect consumers by requiring credit reporting agencies to follow the policies outlined above.
Again, I appreciate TransUnion's decision to make credit freezes available. Thank you for your consideration, and I look forward to your reply.
Sincerely,
Charles E. Schumer
United States Senator
* * *
Donald A. Robert, CEO
Experian
475 Anton Boulevard
Costa Mesa, CA 92626
Dear Mr. Robert:
I write to urge Experian to adopt changes to its credit freeze policy in order to protect consumers better from identity theft. I applaud Experian's recent decision to allow consumers nationwide to place credit freezes on their files. Credit freezes that suspend access to credit reports and scores without the consumer's consent can be valuable tools to stop or prevent the ravages of identity theft. However, I am concerned that Experian intends to require consumers to initiate freezes through certified mail. I am also disappointed that Experian plans to charge consumers $10 for initiating, lifting or removing a freeze, unless they are identity theft victims.
I am calling on Experian, and the other two leading credit bureaus, to protect consumers by making four simple, sensible changes to its credit freeze policies. Consumers are rightly concerned about the risk of identity theft, and credit reporting should foster trust by providing easy access to credit freezes for consumers who fear that their information will be misused.
First, Experian should allow all consumers to request or lift a freeze by telephone, online, or through first-class mail, at the election of the consumer. Certified mail does not provide any additional assurance of the requester's identity, yet the additional time and expense of using certified mail may dissuade consumers who need credit freezes from protecting themselves.
Second, Experian should not charge any fee for placing, temporarily lifting, or removing a credit freeze. It is not just the known victim of identity theft who may wish to protect her private information with a credit freeze, but also the traveler who has lost her pocketbook in the airport, the elderly veteran who mistakenly gave out information to a stranger, or the consumer whose information was exposed in a data security breach. Consumers should be able to suspend unwanted access to their credit records for any reason, without facing repeated fees. It makes even less sense to charge consumers for lifting or removing a credit freeze given that unfettered access to credit information benefits both consumers and lenders.
Third, Experian should immediately implement a consumer request to place, lift and remove a credit freeze. No consumer should have to stand by and wait for a credit freeze to be processed while a thief exploits that consumer's good name. Moreover, as long as the requester's identity is verified, quick lifting of freezes will facilitate legitimate lending and borrowing without harming data privacy. Thus, a telephone or electronic request for changes to a consumer's freeze status should be made within minutes of the request being received.
Finally, now that all three major bureaus intend to offer credit freezes, Experian should transmit any consumer's request for a credit freeze to the other two bureaus, as is currently done with fraud alerts. Using the same procedures developed for fraud alerts, consumers should be able to make a single request to freeze their files at all bureaus. Sharing freeze requests among the credit reporting agencies is more efficient for all parties and will ensure that consumers do not unwittingly leave the door open to identity theft by placing a freeze at only one bureau.
In addition to contacting Experian, I am making these same four requests of the other leading credit bureaus. It is my hope that all the bureaus will promptly adopt these reforms. However, I am also prepared to consider introducing legislation to protect consumers by requiring credit reporting agencies to follow the policies outlined above.
Again, I appreciate Experian's decision to make credit freezes available. Thank you for your consideration, and I look forward to your reply.
Sincerely,
Charles E. Schumer
United States Senator
* * *
Richard F. Smith, Chairman & CEO
Equifax
1550 Peachtree Street NW
Atlanta, Georgia 30309
Dear Mr. Smith:
I write to urge Equifax to structure any new credit freeze policy in order to protect consumers best from identity theft. I was pleased to see recent news reports that Equifax plans to allow consumers nationwide to place credit freezes on their files, and I hope that Equifax follows through on this pledge. Credit freezes that suspend access to credit reports and scores without the consumer's consent can be valuable tools to stop or prevent the ravages of identity theft. However, I am concerned that Equifax may, like other leading credit bureaus, decide to require consumers to initiate freezes through certified mail or to charge consumers $10 for initiating, lifting or removing a freeze, unless they are identity theft victims.
I am calling on Equifax, and the other two leading credit bureaus, to protect consumers by including four simple, sensible elements in credit freeze policies. Consumers are rightly concerned about the risk of identity theft, and credit reporting should foster trust by providing easy access to credit freezes for consumers who fear that their information will be misused.
First, Equifax should allow all consumers to request or lift a freeze by telephone, online, or through first-class mail, at the election of the consumer. Certified mail does not provide any additional assurance of the requester's identity, yet the additional time and expense of using certified mail may dissuade consumers who need credit freezes from protecting themselves.
Second, Equifax should not charge any fee for placing, temporarily lifting, or removing a credit freeze. It is not just the known victim of identity theft who may wish to protect her private information with a credit freeze, but also the traveler who has lost her pocketbook in the airport, the elderly veteran who mistakenly gave out information to a stranger, or the consumer whose information was exposed in a data security breach. Consumers should be able to suspend unwanted access to their credit records for any reason, without facing repeated fees. It makes even less sense to charge consumers for lifting or removing a credit freeze given that unfettered access to credit information benefits both consumers and lenders.
Third, Equifax should immediately implement a consumer request to place, lift and remove a credit freeze. No consumer should have to stand by and wait for a credit freeze to be processed while a thief exploits that consumer's good name. Moreover, as long as the requester's identity is verified, quick lifting of freezes will facilitate legitimate lending and borrowing without harming data privacy. Thus, a telephone or electronic request for changes to a consumer's freeze status should be made within minutes of the request being received.
Finally, now that all three major bureaus intend to offer credit freezes, Equifax should transmit any consumer's request for a credit freeze to the other two bureaus, as is currently done with fraud alerts. Using the same procedures developed for fraud alerts, consumers should be able to make a single request to freeze their files at all bureaus. Sharing freeze requests among the credit reporting agencies is more efficient for all parties and will ensure that consumers do not unwittingly leave the door open to identity theft by placing a freeze at only one bureau.
In addition to contacting Equifax, I am making these same four requests of the other leading credit bureaus. It is my hope that all the bureaus will promptly adopt these elements as a part of credit freeze policies. However, I am also prepared to consider introducing legislation to protect consumers by requiring credit reporting agencies to follow the policies outlined above.
Again, I appreciate Equifax's indication that it plans to make credit freezes available to consumers. Thank you for your consideration, and I look forward to your reply.
Sincerely,
Charles E. Schumer
United States Senator
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