Identity theft continues to be a major concern for Arizona consumers, as the news this week makes clear.

On Monday, this office obtained a sentence of over six years in prison for a Chandler woman who had been employed by a bank as a fraud prevention specialist and used her position to steal the identity of one of her clients. Later this week, two national financial institutions announced the theft of personal data from thousands of their clients by an “insider,” and an Arizona insurance business reported a breach of their clients’ personal information.

These events remind us that vigilant protection of our personal information may not be enough.  Carefree review of our credit and account records and periodic review of the three credit reporting agency files are critical to ID theft protection.  I am glad to report that three new laws, approved by the Legislature this past session with my enthusiastic support, are taking effect this year to give Arizonans stronger safeguards against identity theft.

Credit Freeze

On August 31, Arizona joined 40 other states with a security freeze law.  Even those who have not been victims of identity theft, can now place a freeze on their credit report by the credit reporting agencies.  The freeze restricts the credit reporting agency from releasing a report, or any information contained in the report, without authorization from the consumer.  Without such a credit report, no one can take out credit in your name.

The credit freeze is free for Arizona residents who have been the victim of identity theft.  Otherwise, the fee is $5 per credit reporting bureau ($15 total), and the freeze remains in place until the consumer removes it.  The credit freeze must be requested in writing, and the credit reporting agency must send a written confirmation of the freeze to the consumer within 10 business days after it has been placed.

The freeze is not for everyone.  With a freeze in place a thief cannot get credit in your name, but you can’t either.  It must be lifted for you to buy anything over time.  Lifting the freeze will cost another $5 for each of the three credit reporting agencies. For more information please go to the Attorney General’s Web site, www.azag.gov, and click on “Credit/Security Freeze.”

Credit Application Protection

Starting September 26, a second new law will require lenders to verify the identity of consumers prior to lending money or extending credit to them.
This law will prohibit lenders from lending money or extending credit to a consumer if they have not first taken reasonable steps to establish the consumer’s identity.  These steps include consulting a consumer's credit report and ensuring that the applicant is not an identity thief.

Factual Innocence

The third new law, effective January 1, 2009, will provide victims of identity theft with a way to obtain a judicial determination that someone has stolen their identity.  Under the provisions of this statute, a person whose identity has been stolen and whose name has been used in connection with a crime by another person may petition the superior court for a determination of “factual innocence”. The law provides similar protection for an identity theft victim who is sued by creditors as a result of an identity thief’s actions. This law protects individuals whose identities have been stolen and improperly provided to authorities for harassment or even arrest because of the identity thief.       

These new laws give consumers important safeguards against some of the most damaging impacts of identity theft. In addition, they provide financial institutions and other businesses with the information they need to protect their clients while complying with Arizona's consumer protection laws.

If you are looking for more ways to guard against identity theft, the Attorney General’s Office offers an Identity Theft Repair Kit on its Web site, www.azag.gov. The kit provides tips for avoiding ID theft as well as advice on how to restore your identity if you become a victim. The Attorney General’s Office’s Crime and Fraud Prevention Unit is available to give presentations to community groups on ID theft prevention and other consumer topics. For more information, please call (602) 542-2123 or email communityservices@azag.gov.

Terry Goddard