By ANDREW LaVALLEE
Stolen Social Security numbers and breached credit reports have many Massachusetts
residents concerned about identity theft, with 14 percent indicating that they've
already been victimized, according to a report released today by the Massachusetts
Public Interest Research Group.
The report is based on a written survey given to about 500 people in several of
Boston's major shopping areas last month. About 71 percent said they were concerned
about becoming an identity theft victim.
Eric Bourassa, a consumer advocate for MassPIRG, who authored the report, said
high-profile cases of identity theft have made people more aware of the issue.
''We were surprised by how many said they were victims,'' he said. ''At the same
time, this is a growing crime, so this doesn't sound that off.''
Many businesses have made a point of telling consumers how to protect their personal
information. But many large companies, which guard troves of Social Security numbers,
birth dates, mothers' maiden names and other details on their customers, have
been targeted by data thieves.
For example, MasterCard reported in mid-June that information from 13.9 million
accounts may have been stolen. Natick-based BJ's Wholesale Club announced in March
2004 that tens of thousands of membership card numbers had been stolen.
Nearly 93 percent of respondents to the MassPIRG survey said they support laws
allowing ''security freezes.'' Security freezes allow consumers to block access
to their credit reports, so a thief who had stolen their personal data would still
not be able to apply for loans or credit cards with them. Ten states have passed
security freeze bills, and New Jersey is in the final stages of passing one, MassPIRG
said.
Security freezes, however, pose potential inconveniences to consumers and businesses.
Frozen accounts cannot be accessed even for legitimate use, such as evaluating
loan applications or checking a prospective tenant's credit history.
The security freeze bills allow consumers to unlock, or ''thaw,'' their credit
reports so they can be accessed. The time it takes and the cost to the consumer
varies from state to state. New Jersey's security freeze bill proposes that thaws
be processed within 15 minutes, while others take more than 24 hours.
In MassPIRG's survey, respondents who indicated they support freeze laws were
asked if they still would if it took 48 hours to thaw them: About 89 percent remained
supportive.
Implementing the freeze law should be relatively easy, Bourassa said. ''Ten other
states are already doing it. The system is already in place,'' he said. Particularly
when instant credit approval is so common, people must be able to manage credit
report access at a comparable speed, he added.
The state Legislature's consumer protection committee has created a subcommittee
charged with recommending a bill to address identity theft. Sen. Michael Morrissey,
D-Quincy and co-chairman of the committee, said members are grappling with how
to stop identity theft without disrupting customer transactions, or unintentionally
creating more opportunities for fraud.
''You don't want to be in a position to be crying wolf,'' Morrissey said.
The bill must be limited enough to ''eliminate the chance of fraud and abuse,''
he said. ''Suppose you go down the tubes and go bankrupt - you (could) put a credit
freeze on yourself and continue to spend.''
Some consumers are lumping identity theft together with basic credit card theft,
said Peter Blanchard, vice president of member services for the Massachusetts
Bankers Association.
Blanchard said he's concerned consumers might find it too difficult to lift a
security freeze when they want to apply for credit again.
''Most of (the freeze laws) are a double-edged sword,'' Blanchard said. ''They
might answer one problem but can create another.''
The big credit bureaus - Experian, Equifax and TransUnion - are similarly hesitant.
''We're very cautious about security freeze legislation,'' said Rod Griffin, manager
of public education at Experian. ''File freezing completely removes the consumer
from the credit marketplace. In extreme cases of fraud, that might make sense.
But in most, particularly when seen as a preventive tool, you find that going
to that extreme is not what the consumer wants.''
Since states are tackling identity theft individually, Griffin said credit bureaus
may find themselves complying with 50 different laws. Freeing blocked reports
would not only be time-consuming, he said, but the delay could cause problems
for the borrower. A mortgage applicant, for example, might not receive the best
interest rate, he said.
For consumers' sake, MassPIRG's Bourassa said he hopes the state responds quickly.
''We're only going to get one bite at the identity theft apple in this legislature,''
Bourassa said. ''It makes sense to make a comprehensive identity theft bill that
includes the security freeze.''
