BEYOND THE HEDGES: Credit fraud through identity theft a growing problem, U.S. PIRG warns

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"Theft-of-identity victims spend months, even years, trying to clean up the wreckage of their good names," Campaign Director for U.S. PIRG Beth Niederman said.

"Unfortunately, credit bureaus, banks and department stores all claim it's not their problem, even when they knowingly reinsert false information into a victim's credit report again and again. Some victims have been arrested for the crimes of the thief and most have been denied credit or jobs due to the fraud."

The report, "Theft of Identity: The Consumer X-Files," cites the lack of concern on the part of credit bureaus toward consumer complaints. According to the report, credit bureaus generally refuse to remove false accounts from credit reports unless the creditor "source," i.e. the banks or department stores, instruct them to.

Application procedures, such as in-mail "instant credit" offers, often make it easier for thieves to steal credit information. In addition, police and federal officials are generally reluctant to investigate claims of fraud unless the losses exceed $50,000.

The report makes several recommendations to Congress, including enacting reforms that give consumers the right to sue creditors and credit bureaus that allow errors to appear or reappear in credit reports and granting the right to free credit reports annually.

Another reform would protect consumer privacy by restricting availability of credit reports and penalizing creditors and credit bureaus that allow illegal access to credit reports.

The PIRG report also makes recommendations for victims of identity theft, such as contacting credit bureaus and creditors immediately if theft is suspected and asking them to block further access to the reports.

For more information or a free fact sheet, contact PIRG via e-mail at watchdog@pirg.org.

This item appeared in the News section of the September 13, 1996 issue.

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