BILL NUMBER: S3240

SPONSOR: COMRIE
 
TITLE OF BILL:

An act to amend the general business law, in relation to the definition
of "protected consumer"

 
PURPOSE:

Relates to defining a "protected consumer" as an individual who is under
the age of 18 years.

 
SUMMARY OF PROVISIONS:

Section 1 amends subdivision (o) of section 380-a of the general busi-
ness law, as added by chapter 441 of the laws of 2014 to read as
follows: The term "protected consumer" will mean an individual who is
under the age of eighteen years of age at the time a request for the
placement of a security freeze is made.

              

Section 2 Effective date.

 
JUSTIFICATION:

According to the Federal Trade Commission (FTC), a child's social secu-
rity number can be used by identity thieves to apply for government
benefits, open bank and credit card accounts, apply for a loan or utili-
ty service, or rent a place to live. According to a 2011 report from ID
Analytics, an identity theft protection firm, an estimated 140,000
minors are at risk of becoming victims of identity theft each and every
year. Another 2011 study, from CyLab, a research center at Carnegie
Mellon University, examined 43,000 children who were registered with a
commercial identity protection service and found that 10% of them had
someone else using their social security number.  Cylab also documented
that kids under the age of 18 are 51 times more likely to become victims
of identity theft than their parents. The FTC advises parents to check
their children's credit reports to see if their personal information is
being misused, and to take immediate action if it is. However, there is
a glaring error in the law in which no mechanism currently exists for
parents of children in New York State ages 17 to take proactive measures
to protect their children's credit. This bill would include seventeen
year olds within the scope of protections.

In 2014, New York amended its general business law to line up with other
state laws in line with state laws, which require credit reporting agen-
cies to allow a parent to freeze their child's credit even when no file
exists, thereby averting the potential for identity theft to occur in
the first place. That law defined a "protected consumer" as anyone under
the age of 16.

Child identity theft is a particularly egregious problem because it may
go undetected for years, until the child applies for student loans,
other forms of credit, or even a job. Further, child identity theft is
particularly detrimental because it can postpone college admission due
to student loan denials, gaining employment, accessing credit, and rent-
ing or purchasing a home. These delays can last for months or even
years, until the child can dispute the fraudulent activity and have the
activity cleared from their credit report. In our global world, and in
light of data-sharing of our children's personally identifying informa-
tion, it is imperative that parents have a way to protect their chil-
dren's credit records. Thus raising the age of a "protected consumer" to
under the age of 18 is imperative so that all minors are afforded these
vital protections.

 
LEGISLATIVE HISTORY:

2015-16: S.6254/A.8619 Referred to Finance.
2017-18: senate Bill 3583

 
FISCAL IMPLICATIONS:

None to the State.

 
EFFECTIVE DATE:
This act shall take effect immediately.