Last-ditch efforts to give Arizona residents a tool against identity thieves fell short last month as the proposal faced too many legislative obstacles.
At one point it seemed it was going to get through, only to stumble into more roadblocks. At the end of the day, its sponsor said there simply wasn’t enough time for one more push.
“That’s how it goes. You got to play by the rules,” said Sen. Amanda Aguirre, D-24, sponsor of S1345.
Aguirre vowed to give the measure another try next session.
Based on the number of those who voted for it, many found the idea of allowing consumers to freeze their credit report—and thereby helping stop thieves from stealing people’s identities—sound. All 30 senators backed the measure on the floor and seven representatives gave it their nod in committee.
Smooth journey encounters rough waters
But after sailing smoothly in the Senate, S1345 was assigned to three committees in the House. The move, in a way, spelled the bill’s eventual failure; few measures get out of three committees, given, among others, the number of other proposals all asking for a hearing.
The Aguirre bill managed to get out of the judiciary committee, with the support of all members present, but got stuck in the government and commerce committees. The chair of House Rules also remarked that people could, under current laws, already freeze their credit report.
In fact, one lawmaker said while she supported provisions of the bill, she did not want to waste time hearing a bill that was going to be “DOA in Rules.”
Legislature might be ‘overreaching’
The rules chair, Rep. Bob Robson, R-20, was concerned that in trying to combat to identity theft, the legislature might be “overreaching” and in the process could be stifling people’s ability to gain access to their own reports; it might place undue burden on commercial transactions.
Up until late last month, the bill’s sponsor, Sen. Amanda Aguirre, D-24, was laboring first to have her bill withdrawn from the government committee and then to have it put back in the agenda after the Speaker appeared to have either rejected the request to withdraw it or simply took no action on it.
Aguirre also worked with another lawmaker, Rep. Marian McClure, R-30, to move the measure in the Senate as a striker on a McClure bill. That too went nowhere after the bill, with its would-be amendment, did not get a late hearing in her chamber, according to Aguirre.
“We were still looking last week to find a vehicle to (put a) strike everything amendment to a bill that was dead in the Senate. Unfortunately, we missed the deadline for the submission of a strike everything amendment. So we basically don’t have another vehicle,” Aguirre said.
A long shot would be to offer an amendment to a bill on the Senate floor.
“But I would need to consult with many other folks to make sure that if I’d amend the bill on the floor to include my identity theft bill, it won’t kill the underlying the bill,” the senator said.
Aguirre has not offered the amendment at press time.
Rep. Kirk Adams, R-19, confirmed that he has completed the paperwork to withdraw Aguirre’s bill from the government committee.
“I submitted the standard memo requesting that it be withdrawn. I did that as a courtesy to Sen. Aguirre and that was submitted properly to the Speaker’s Office and that’s where it stands as far as I know right now,” he said.
Adams also said Aguirre attempted to have it placed back in the agenda.
But by then it was too late.
“In fact I think she did attempt to call but that was on a Friday after the agenda deadline has already passed,” he said. “The agenda was already done and made up and ready to go, and I already distributed it actually.”
Adams: bill had a ‘role to play’
Adams thought the bill had a “role to play” in the efforts to combat identity theft, a growing problem in Arizona.
The state, in fact, is No. 1 as far as identity theft. A federal commission reported that the areas with the highest per capita rate of this type of crime in 2005 were Phoenix, Mesa and Scottsdale; cities in Nevada and California came next.
9,000 complaints are ‘tip of the iceberg’
Some 9,000 complaints from residents were logged that year, according to reports. The Public Interest Research Group and the Consumers Union, which supported the Aguirre bill, believe the number is just the tip of the iceberg.
“The security freeze established under SB 1345 would enable you to prevent anyone from applying for credit in your name because it blocks access to your credit files. If a security freeze is in place, creditors cannot process new applications for credit unless you give them permission to do so,” the groups stated in a position paper.
“So if an imposter applies for credit in your name while a security freeze is in place, the application will be denied. If you are applying for credit, you can lift the freeze so that a particular creditor can review your credit file for a specified period of time,” they said.
In fact, more than two dozen other states, including the District of Columbia, have passed laws enabling consumers to prevent thieves from using stolen information to open new accounts, they said, calling the Aguirre bill a “common sense consumer safeguard.”
Adams told the Capitol Times concerns were raised but that he did not think there was anything that was “insurmountable or couldn’t be overcome” by the bill. He also described the measure as “probably a pretty good idea.”
“(But) the question is: Is it written in such a way that is practical to implement?” he said.
Aguirre said she had received assurances from Robson that he would work with her on the measure next year.
Robson said he pointed to Aguirre areas where “the bill needed to be fundamentally worked on to make it more practicable.”
“I’ve listed some of my concerns,” he said.
That list, a copy of which Aguirre provided the Capitol Times, said a freeze does not prevent a thief who gets access to a bank account from emptying it out; that the cost of thawing a frozen report differs, depending upon the state and credit bureau; it may cost $30 to lift and refreeze the report and that the consumer will have no ability to check their credit reports for fraudulent transactions without paying to lift the freeze, making it an “expensive and time-consuming task.”
Freeze can stop both thieves and consumers
“It can be a powerful tool to prevent identity thieves from entering into transactions and stop problems before they occur. But just as a consumer freeze stops identity thieves, it also can stop consumers,” the document said.
This was the same argument put forward by the retail industry, which was apprehensive that the bill would affect its ability to provide fast, hassle-free service.
While acknowledging these points, Aguirre said she thought some of them were already addressed by her bill.
“There are some that we are never going to stop,” she said. “There are so many criminals out there that they are trying to outsmart every system that is put in place.”
“The ID theft bill that I introduced put some measures to allow us to keep safe our consumer record report,” she said.
Aguirre also pointed out that suggestions have been accommodated and amendments made as stakeholders came forward with their inputs.
The bill sets a mechanism to freeze a credit report through certified mail and the freeze is not lifted until the consumer says so.
It requires a consumer-reporting agency to temporarily lift the freeze within three business days upon receiving a consumer’s request by mail or 15 minutes after the consumer’s request is received by phone, fax, or Internet during business hours.
It allows an agency to charge a reasonable fee for the process, but prohibits the agency from collecting from an identity theft victim who presents a valid police report.
The courts and several government agencies have been exempted from the freeze.
Aguirre said they were going to closely watch the fees imposed to freeze or lift a report.
“We were very flexible, but at the same time we want to make sure that we have in place enough security to protect us,” she said.