Business Practices & Corporate Accountability News

Legislation recently filed by state Senator Jarrett Barrios and state Representatives William Straus and Michael Costello would go a long way to protect consumers in Massachusetts against identity theft, according to consumer advocacy group MASSPIRG.

“This recent security breach of TJX Cos. customers’ credit and debit card information is a perfect example of why Massachusetts needs stronger identity theft protection laws,” said MASSPIRG Consumer Advocate Eric Bourassa. “In fact, this TJX security breach is worse than other recently reported breaches because the company is saying that this data has been stolen, not just lost.”

Under legislation filed last week on Beacon Hill, businesses like TJX that experience a security breach would be required to contact affected customers to notify them that their information has been compromised.

MASSPIRG says this is important so affected people can take preventative steps to stop identity theft before it happens, such as monitoring credit card statements, changing account numbers, and getting copies of credit reports to see if identity thieves have opened new credit accounts.

“New credit accounts is one of the worst types of identity theft,” said Bourassa. “Thieves use the information they’ve stolen to open credit in a person’s name and then rack up debt, often going unnoticed by the victim for years.”

MASSPIRG research has found that this type of identity theft costs victims upwards of $1,200 and hundreds of hours to straighten up.

Another key component of the legislation, according to MASSPIRG, is allowing individual consumes to place a security freeze on their credit report as a way of preventing thieves from opening up new credit accounts in another person’s name.

“The credit report security freeze acts as a lock, blocking a credit card company, bank, or any creditor from accessing a consumers credit report and therefore preventing new credit from being opened,” said Bourassa. “Consumers set up the security freeze with the credit reporting agencies and use a password to unlock the security freeze for legitimate applications of credit.”

According to MASSPIRG, thirty-five states have passed security breach notification requirements and twenty-six states have passed credit report security freeze laws, including all of the New England states except Massachusetts.

“Massachusetts has to catch up with other states and provide consumers with more tools to better protect against identity theft,” continued Bourassa. “The legislature came close last year, and needs to make identity theft a top priority in the new session.”