WASHINGTON, D.C. – Committee Chairman Daniel K. Inouye (D-Hawaii), along with Committee Vice Chairman Ted Stevens (R-Alaska), Consumer Affairs, Insurance and Automotive Safety Subcommittee Chairman Mark Pryor (D-Ark.), and Senator Gordon H. Smith (R-Ore.) introduced the Identity Theft Prevention Act of 2007 earlier today, which authorizes the Federal Trade Commission (FTC) to protect consumers from identity theft and directly hold data breachers accountable for their actions.

 

 

 “Americans have long demanded better protection for their sensitive, personal information. We must ensure that American Consumers feel confident that our government is doing all it can to protect their personal data.” said Chairman Inouye. “Consumer protection is our number one goal. The Identity Theft Prevention Act not only achieves this, but also empowers the consumer to act in the event of a security breach.” 

 

The Identity Theft Prevention of Act of 2007 requires the FTC to set standards to protect sensitive, personal information and to verify the identity of third parties seeking the information.  The FTC must craft and issue final rules for third party identification within one year of enactment.

 

The bill also requires businesses from sole proprietors to large corporations, non-profit organizations, educational institutions, and other organizations that acquire, maintain, or utilize sensitive personal information to safeguard this information. With the exception of banks and brokers, who are regulated by other federal authorities, all violators may be fined up to $11,000 per violation per day with no cap. Additionally, the bill obligates these businesses and organizations to notify consumers of any security breaches in which there is a reasonable risk that the information may be used for identity theft.

 

Also under the Act, a consumer may place a security freeze on his or her consumer credit report.  Once a consumer places a freeze on his or her credit report, no credit reporting agency may release any information from the consumer’s credit report, unless the consumer gives explicit authorization.

 

The Identity Theft Prevention Act of 2007 is modeled, in part, on S. 1408, the Identity Theft Prevention Act, which reported out of the Committee during the 109th Congress.

 

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