North Carolina Identity Theft Legislation Becomes Effective

On October 1, the operative provisions of North Carolina SB 1017, an Act enhancing protections available to victims of identity theft, went into effect (SB 1017 was initially reported in InfoBytes, Aug. 7, 2009). In general, the Act creates new legal obligations for credit reporting agencies (CRAs), creditors, businesses, and credit monitoring services. Under the Act, CRAs must notify a North Carolina consumer who requests a security freeze that, in order to obtain a freeze from another CRA, he or she must make a separate, individual request to that CRA because only it can obtain the consumer authorization necessary to freeze its own files. The Act also mandates that CRAs lower their response times to a consumer’s request to add or remove a freeze. With respect to creditors, the Act prohibits any communication about a debt to a CRA during the pendency of a consumer’s application for an award from the North Carolina Crime Victims Compensation Fund. The Act also requires credit monitoring services to notify consumers that they have the right to one free credit report per year before charging the consumer a fee to obtain or monitor the consumer’s credit report on behalf of the consumer.