101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
HB3674

 

Introduced , by Rep. Mary Edly-Allen

 

SYNOPSIS AS INTRODUCED:
 
815 ILCS 505/2MM

    Amends the Consumer Fraud and Deceptive Business Practices Act. Provides that, in addition to a freeze on a minor's consumer report, a freeze may be placed on the credit file of a minor and specified other persons. Establishes the procedures for obtaining a freeze on the credit file of a minor or protected consumer. Defines terms.


LRB101 04817 TAE 49826 b

 

 

A BILL FOR

 

HB3674LRB101 04817 TAE 49826 b

1    AN ACT concerning business.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Consumer Fraud and Deceptive Business
5Practices Act is amended by changing Section 2MM as follows:
 
6    (815 ILCS 505/2MM)
7    Sec. 2MM. Verification of accuracy of consumer reporting
8information used to extend consumers credit and security freeze
9on credit reports.
10    (a) A credit card issuer who mails an offer or solicitation
11to apply for a credit card and who receives a completed
12application in response to the offer or solicitation which
13lists an address that is not substantially the same as the
14address on the offer or solicitation may not issue a credit
15card based on that application until reasonable steps have been
16taken to verify the applicant's change of address.
17    (b) Any person who uses a consumer credit report in
18connection with the approval of credit based on the application
19for an extension of credit, and who has received notification
20of a police report filed with a consumer reporting agency that
21the applicant has been a victim of financial identity theft, as
22defined in Section 16-30 or 16G-15 of the Criminal Code of 1961
23or the Criminal Code of 2012, may not lend money or extend

 

 

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1credit without taking reasonable steps to verify the consumer's
2identity and confirm that the application for an extension of
3credit is not the result of financial identity theft.
4    (c) A consumer may request that a security freeze be placed
5on his or her credit report by sending a request in writing by
6certified mail or by at least one of telephone or electronic
7means to a consumer reporting agency at an address or telephone
8or electronic location designated by the consumer reporting
9agency to receive such requests.
10    The following persons may request that a security freeze be
11placed on the credit report of a person with a disability:
12        (1) a guardian of the person with a disability who is
13    the subject of the request, appointed under Article XIa of
14    the Probate Act of 1975; and
15        (2) an agent of the person with a disability who is the
16    subject of the request, under a written durable power of
17    attorney that complies with the Illinois Power of Attorney
18    Act.
19    The following persons may request that a security freeze be
20placed on the credit report of a minor:
21        (1) a guardian of the minor who is the subject of the
22    request, appointed under Article XI of the Probate Act of
23    1975;
24        (2) a parent of the minor who is the subject of the
25    request; and
26        (3) a guardian appointed under the Juvenile Court Act

 

 

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1    of 1987 for a minor under the age of 18 who is the subject
2    of the request or, with a court order authorizing the
3    guardian consent power, for a youth who is the subject of
4    the request who has attained the age of 18, but who is
5    under the age of 21.
6    This subsection (c) does not prevent a consumer reporting
7agency from advising a third party that a security freeze is in
8effect with respect to the consumer's credit report.
9    (d) A consumer reporting agency shall place a security
10freeze on a consumer's credit report no later than 5 business
11days after receiving a written request from the consumer:
12        (1) a written request described in subsection (c); and
13        (2) proper identification.
14    (e) Upon placing the security freeze on the consumer's
15credit report, the consumer reporting agency shall send to the
16consumer within 10 business days a written confirmation of the
17placement of the security freeze and a unique personal
18identification number or password or similar device, other than
19the consumer's Social Security number, to be used by the
20consumer when providing authorization for the release of his or
21her credit report for a specific party or period of time.
22    (f) If the consumer wishes to allow his or her credit
23report to be accessed for a specific party or period of time
24while a freeze is in place, he or she shall contact the
25consumer reporting agency using a point of contact designated
26by the consumer reporting agency, request that the freeze be

 

 

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1temporarily lifted, and provide the following:
2        (1) proper identification;
3        (2) the unique personal identification number or
4    password or similar device provided by the consumer
5    reporting agency; and
6        (3) the proper information regarding the third party or
7    time period for which the report shall be available to
8    users of the credit report.
9    A security freeze for a minor may not be temporarily
10lifted. This Section does not require a consumer reporting
11agency to provide to a minor or a parent or guardian of a minor
12on behalf of the minor a unique personal identification number,
13password, or similar device provided by the consumer reporting
14agency for the minor, or parent or guardian of the minor, to
15use to authorize the consumer reporting agency to release
16information from a minor.
17    (f-5) The following persons may request that a security
18freeze be placed on the credit file of a minor:
19        (1) a parent of the minor who is the subject of the
20    request;
21        (2) a guardian, appointed under Article XI of the
22    Probate Act of 1975, of the minor who is the subject of the
23    request; and
24        (3) a guardian, appointed under the Juvenile Court Act
25    of 1987, of a minor under the age of 18 who is the subject
26    of the request or, with a court order authorizing the

 

 

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1    guardian's consent power, of a youth who is the subject of
2    the request who has attained the age of 18, but who is
3    under the age of 21.
4    (f-10) A request under subsection (f-5) must be in writing
5and must contain:
6        (1) The following information with respect to the
7    parent or guardian:
8            (A) complete name, including any suffix;
9            (B) a complete address;
10            (C) a copy of the person's social security card or
11        a certified or official copy of the person's birth
12        certificate; and
13            (D) a copy of the person's driver's license,
14        identification card issued by the Secretary of State or
15        any other government-issued identification, or a copy
16        of a utility bill that shows name and home address.
17        (2) The following information with respect to the
18    protected consumer or minor who is the subject of the
19    freeze:
20            (A) complete name, including any suffix;
21            (B) a complete address;
22            (C) a copy of a social security card;
23            (D) for a minor, a certified or official copy of
24        the minor's birth certificate; and
25            (E) for a person under guardianship or power of
26        attorney, an order issued by a court of law, a lawfully

 

 

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1        executed and valid power of attorney, or a written,
2        signed, and notarized statement that expressly
3        describes the authority of the person making the
4        request to act on behalf of the protected consumer.
5    A security freeze on a credit file for a minor may not be
6temporarily lifted.
7    (g) A consumer reporting agency shall develop a contact
8method to receive and process a request from a consumer to
9temporarily lift a freeze on a credit report pursuant to
10subsection (f) in an expedited manner.
11    A contact method under this subsection shall include: (i) a
12postal address; and (ii) an electronic contact method chosen by
13the consumer reporting agency, which may include the use of
14telephone, fax, Internet, or other electronic means.
15    (h) A consumer reporting agency that receives a request
16from a consumer to temporarily lift a freeze on a credit report
17pursuant to subsection (f), shall comply with the request no
18later than 3 business days after receiving the request.
19    (i) A consumer reporting agency shall remove or temporarily
20lift a freeze placed on a consumer's credit report only in the
21following cases:
22        (1) upon consumer request, pursuant to subsection (f)
23    or subsection (l) of this Section; or
24        (2) if the consumer's credit report was frozen due to a
25    material misrepresentation of fact by the consumer.
26    If a consumer reporting agency intends to remove a freeze

 

 

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1upon a consumer's credit report pursuant to this subsection,
2the consumer reporting agency shall notify the consumer in
3writing prior to removing the freeze on the consumer's credit
4report.
5    (j) If a third party requests access to a credit report on
6which a security freeze is in effect, and this request is in
7connection with an application for credit or any other use, and
8the consumer does not allow his or her credit report to be
9accessed for that specific party or period of time, the third
10party may treat the application as incomplete.
11    (k) If a consumer requests a security freeze, the credit
12reporting agency shall disclose to the consumer the process of
13placing and temporarily lifting a security freeze, and the
14process for allowing access to information from the consumer's
15credit report for a specific party or period of time while the
16freeze is in place.
17    (l) A security freeze shall remain in place until the
18consumer or person authorized under subsection (c) to act on
19behalf of the minor or person with a disability who is the
20subject of the security freeze requests, using a point of
21contact designated by the consumer reporting agency, that the
22security freeze be removed. A credit reporting agency shall
23remove a security freeze within 3 business days of receiving a
24request for removal from the consumer, who provides:
25        (1) proper identification; and
26        (2) the unique personal identification number or

 

 

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1    password or similar device provided by the consumer
2    reporting agency.
3    (m) A consumer reporting agency shall require proper
4identification of the person making a request to place or
5remove a security freeze and may require proper identification
6and proper authority from the person making the request to
7place or remove a freeze on behalf of the person with a
8disability or minor.
9    (n) The provisions of subsections (c) through (m) of this
10Section do not apply to the use of a consumer credit report by
11any of the following:
12        (1) A person or entity, or a subsidiary, affiliate, or
13    agent of that person or entity, or an assignee of a
14    financial obligation owing by the consumer to that person
15    or entity, or a prospective assignee of a financial
16    obligation owing by the consumer to that person or entity
17    in conjunction with the proposed purchase of the financial
18    obligation, with which the consumer has or had prior to
19    assignment an account or contract, including a demand
20    deposit account, or to whom the consumer issued a
21    negotiable instrument, for the purposes of reviewing the
22    account or collecting the financial obligation owing for
23    the account, contract, or negotiable instrument. For
24    purposes of this subsection, "reviewing the account"
25    includes activities related to account maintenance,
26    monitoring, credit line increases, and account upgrades

 

 

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1    and enhancements.
2        (2) A subsidiary, affiliate, agent, assignee, or
3    prospective assignee of a person to whom access has been
4    granted under subsection (f) of this Section for purposes
5    of facilitating the extension of credit or other
6    permissible use.
7        (3) Any state or local agency, law enforcement agency,
8    trial court, or private collection agency acting pursuant
9    to a court order, warrant, or subpoena.
10        (4) A child support agency acting pursuant to Title
11    IV-D of the Social Security Act.
12        (5) The State or its agents or assigns acting to
13    investigate fraud.
14        (6) The Department of Revenue or its agents or assigns
15    acting to investigate or collect delinquent taxes or unpaid
16    court orders or to fulfill any of its other statutory
17    responsibilities.
18        (7) The use of credit information for the purposes of
19    prescreening as provided for by the federal Fair Credit
20    Reporting Act.
21        (8) Any person or entity administering a credit file
22    monitoring subscription or similar service to which the
23    consumer has subscribed.
24        (9) Any person or entity for the purpose of providing a
25    consumer with a copy of his or her credit report or score
26    upon the consumer's request.

 

 

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1        (10) Any person using the information in connection
2    with the underwriting of insurance.
3    (n-5) A consumer reporting agency may not impose a charge
4on a consumer for placing a freeze, removing a freeze, or
5temporarily lifting a freeze.
6    (o) If a security freeze is in place, a consumer reporting
7agency shall not change any of the following official
8information in a credit report without sending a written
9confirmation of the change to the consumer within 30 days of
10the change being posted to the consumer's file: (i) name, (ii)
11date of birth, (iii) Social Security number, and (iv) address.
12Written confirmation is not required for technical
13modifications of a consumer's official information, including
14name and street abbreviations, complete spellings, or
15transposition of numbers or letters. In the case of an address
16change, the written confirmation shall be sent to both the new
17address and to the former address.
18    (p) The following entities are not required to place a
19security freeze in a consumer report, however, pursuant to
20paragraph (3) of this subsection, a consumer reporting agency
21acting as a reseller shall honor any security freeze placed on
22a consumer credit report by another consumer reporting agency:
23        (1) A check services or fraud prevention services
24    company, which issues reports on incidents of fraud or
25    authorizations for the purpose of approving or processing
26    negotiable instruments, electronic funds transfers, or

 

 

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1    similar methods of payment.
2        (2) A deposit account information service company,
3    which issues reports regarding account closures due to
4    fraud, substantial overdrafts, ATM abuse, or similar
5    negative information regarding a consumer to inquiring
6    banks or other financial institutions for use only in
7    reviewing a consumer request for a deposit account at the
8    inquiring bank or financial institution.
9        (3) A consumer reporting agency that:
10            (A) acts only to resell credit information by
11        assembling and merging information contained in a
12        database of one or more consumer reporting agencies;
13        and
14            (B) does not maintain a permanent database of
15        credit information from which new credit reports are
16        produced.
17    (q) For purposes of this Section:
18    "Credit file" has the same meaning as provided for "file"
19in 15 U.S.C. 1681a(g).
20    "Credit report" has the same meaning as "consumer report",
21as ascribed to it in 15 U.S.C. Sec. 1681a(d).
22    "Consumer reporting agency" has the meaning ascribed to it
23in 15 U.S.C. Sec. 1681a(f).
24    "Security freeze" means a notice placed in a consumer's
25credit report, at the request of the consumer and subject to
26certain exceptions, that prohibits the consumer reporting

 

 

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1agency from releasing the consumer's credit report or score
2relating to an extension of credit, without the express
3authorization of the consumer.
4    "Extension of credit" does not include an increase in an
5existing open-end credit plan, as defined in Regulation Z of
6the Federal Reserve System (12 C.F.R. 226.2), or any change to
7or review of an existing credit account.
8    "Proper authority" means documentation that shows that a
9parent, guardian, or agent has authority to act on behalf of a
10minor or person with a disability. "Proper authority" includes
11(1) an order issued by a court of law that shows that a
12guardian has authority to act on behalf of a minor or person
13with a disability, (2) a written, notarized statement signed by
14a parent that expressly describes the authority of the parent
15to act on behalf of the minor, or (3) a durable power of
16attorney that complies with the Illinois Power of Attorney Act.
17    "Proper identification" means information generally deemed
18sufficient to identify a person. Only if the consumer is unable
19to reasonably identify himself or herself with the information
20described above, may a consumer reporting agency require
21additional information concerning the consumer's employment
22and personal or family history in order to verify his or her
23identity.
24    (r) Any person who violates this Section commits an
25unlawful practice within the meaning of this Act.
26(Source: P.A. 99-143, eff. 7-27-15; 99-373, eff. 1-1-16;

 

 

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199-642, eff. 7-28-16; 100-589, eff. 6-8-18.)