Illinois General Assembly - Full Text of HB3425
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Full Text of HB3425  99th General Assembly




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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 to a consumer reporting agency at an address
7designated by the consumer reporting agency to receive such
9    The following persons may request that a security freeze be
10placed on the credit report of a disabled person:
11        (1) a guardian of the disabled person that is the
12    subject of the request, appointed under Article XIa of the
13    Probate Act of 1975; and
14        (2) an agent of the disabled person that is the subject
15    of the request, under a written durable power of attorney
16    that complies with the Illinois Power of Attorney Act.
17     The following persons may request that a security freeze
18be placed on the credit report of a minor:
19        (1) a guardian of the minor that is the subject of the
20    request, appointed under Article XI of the Probate Act of
21    1975;
22        (2) a parent of the minor that is the subject of the
23    request; and
24        (3) a guardian appointed under the Juvenile Court Act
25    of 1987 for 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 consent power, for 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    This subsection (c) does not prevent a consumer reporting
5agency from advising a third party that a security freeze is in
6effect with respect to the consumer's credit report.
7    (d) A consumer reporting agency shall place a security
8freeze on a consumer's credit report no later than 5 business
9days after receiving a written request from the consumer:
10        (1) a written request described in subsection (c);
11        (2) proper identification; and
12        (3) payment of a fee, if applicable.
13    (e) Upon placing the security freeze on the consumer's
14credit report, the consumer reporting agency shall send to the
15consumer within 10 business days a written confirmation of the
16placement of the security freeze and a unique personal
17identification number or password or similar device, other than
18the consumer's Social Security number, to be used by the
19consumer when providing authorization for the release of his or
20her credit report for a specific party or period of time.
21    (f) If the consumer wishes to allow his or her credit
22report to be accessed for a specific party or period of time
23while a freeze is in place, he or she shall contact the
24consumer reporting agency using a point of contact designated
25by the consumer reporting agency, request that the freeze be
26temporarily lifted, and provide the following:



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1        (1) Proper identification;
2        (2) The unique personal identification number or
3    password or similar device provided by the consumer
4    reporting agency;
5        (3) The proper information regarding the third party or
6    time period for which the report shall be available to
7    users of the credit report; and
8        (4) A fee, if applicable.
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    (g) A consumer reporting agency shall develop a contact
18method to receive and process a request from a consumer to
19temporarily lift a freeze on a credit report pursuant to
20subsection (f) in an expedited manner.
21    A contact method under this subsection shall include: (i) a
22postal address; and (ii) an electronic contact method chosen by
23the consumer reporting agency, which may include the use of
24telephone, fax, Internet, or other electronic means.
25    (h) A consumer reporting agency that receives a request
26from a consumer to temporarily lift a freeze on a credit report



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1pursuant to subsection (f), shall comply with the request no
2later than 3 business days after receiving the request.
3    (i) A consumer reporting agency shall remove or temporarily
4lift a freeze placed on a consumer's credit report only in the
5following cases:
6        (1) upon consumer request, pursuant to subsection (f)
7    or subsection (l) of this Section; or
8        (2) if the consumer's credit report was frozen due to a
9    material misrepresentation of fact by the consumer.
10    If a consumer reporting agency intends to remove a freeze
11upon a consumer's credit report pursuant to this subsection,
12the consumer reporting agency shall notify the consumer in
13writing prior to removing the freeze on the consumer's credit
15    (j) If a third party requests access to a credit report on
16which a security freeze is in effect, and this request is in
17connection with an application for credit or any other use, and
18the consumer does not allow his or her credit report to be
19accessed for that specific party or period of time, the third
20party may treat the application as incomplete.
21    (k) If a consumer requests a security freeze, the credit
22reporting agency shall disclose to the consumer the process of
23placing and temporarily lifting a security freeze, and the
24process for allowing access to information from the consumer's
25credit report for a specific party or period of time while the
26freeze is in place.



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1    (l) A security freeze shall remain in place until the
2consumer or person authorized under subsection (c) to act on
3behalf of the minor or disabled person that is the subject of
4the security freeze requests, using a point of contact
5designated by the consumer reporting agency, that the security
6freeze be removed. A credit reporting agency shall remove a
7security freeze within 3 business days of receiving a request
8for removal from the consumer, who provides:
9        (1) Proper identification;
10        (2) The unique personal identification number or
11    password or similar device provided by the consumer
12    reporting agency; and
13        (3) A fee, if applicable.
14    (m) A consumer reporting agency shall require proper
15identification of the person making a request to place or
16remove a security freeze and may require proper identification
17and proper authority from the person making the request to
18place or remove a freeze on behalf of the disabled person or
20    (n) The provisions of subsections (c) through (m) of this
21Section do not apply to the use of a consumer credit report by
22any of the following:
23        (1) A person or entity, or a subsidiary, affiliate, or
24    agent of that person or entity, or an assignee of a
25    financial obligation owing by the consumer to that person
26    or entity, or a prospective assignee of a financial



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1    obligation owing by the consumer to that person or entity
2    in conjunction with the proposed purchase of the financial
3    obligation, with which the consumer has or had prior to
4    assignment an account or contract, including a demand
5    deposit account, or to whom the consumer issued a
6    negotiable instrument, for the purposes of reviewing the
7    account or collecting the financial obligation owing for
8    the account, contract, or negotiable instrument. For
9    purposes of this subsection, "reviewing the account"
10    includes activities related to account maintenance,
11    monitoring, credit line increases, and account upgrades
12    and enhancements.
13        (2) A subsidiary, affiliate, agent, assignee, or
14    prospective assignee of a person to whom access has been
15    granted under subsection (f) of this Section for purposes
16    of facilitating the extension of credit or other
17    permissible use.
18        (3) Any state or local agency, law enforcement agency,
19    trial court, or private collection agency acting pursuant
20    to a court order, warrant, or subpoena.
21        (4) A child support agency acting pursuant to Title
22    IV-D of the Social Security Act.
23        (5) The State or its agents or assigns acting to
24    investigate fraud.
25        (6) The Department of Revenue or its agents or assigns
26    acting to investigate or collect delinquent taxes or unpaid



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1    court orders or to fulfill any of its other statutory
2    responsibilities.
3        (7) The use of credit information for the purposes of
4    prescreening as provided for by the federal Fair Credit
5    Reporting Act.
6        (8) Any person or entity administering a credit file
7    monitoring subscription or similar service to which the
8    consumer has subscribed.
9        (9) Any person or entity for the purpose of providing a
10    consumer with a copy of his or her credit report or score
11    upon the consumer's request.
12        (10) Any person using the information in connection
13    with the underwriting of insurance.
14    (n-5) This Section does not prevent a consumer reporting
15agency from charging a fee of no more than $10 to a consumer
16for each freeze, removal, or temporary lift of the freeze,
17regarding access to a consumer credit report, except that a
18consumer reporting agency may not charge a fee to: (i) a
19consumer 65 years of age or over for placement and removal of a
20freeze; , or (ii) a victim of identity theft who has submitted
21to the consumer reporting agency a valid copy of a police
22report, investigative report, or complaint that the consumer
23has filed with a law enforcement agency about unlawful use of
24his or her personal information by another person; or (iii) an
25active duty military service member who has submitted to the
26consumer reporting agency a copy of his or her orders calling



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



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1    which issues reports regarding account closures due to
2    fraud, substantial overdrafts, ATM abuse, or similar
3    negative information regarding a consumer to inquiring
4    banks or other financial institutions for use only in
5    reviewing a consumer request for a deposit account at the
6    inquiring bank or financial institution.
7        (3) A consumer reporting agency that:
8            (A) acts only to resell credit information by
9        assembling and merging information contained in a
10        database of one or more consumer reporting agencies;
11        and
12            (B) does not maintain a permanent database of
13        credit information from which new credit reports are
14        produced.
15    (q) For purposes of this Section:
16    "Credit report" has the same meaning as "consumer report",
17as ascribed to it in 15 U.S.C. Sec. 1681a(d).
18    "Consumer reporting agency" has the meaning ascribed to it
19in 15 U.S.C. Sec. 1681a(f).
20    "Security freeze" means a notice placed in a consumer's
21credit report, at the request of the consumer and subject to
22certain exceptions, that prohibits the consumer reporting
23agency from releasing the consumer's credit report or score
24relating to an extension of credit, without the express
25authorization of the consumer.
26     "Extension of credit" does not include an increase in an



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1existing open-end credit plan, as defined in Regulation Z of
2the Federal Reserve System (12 C.F.R. 226.2), or any change to
3or review of an existing credit account.
4    "Proper authority" means documentation that shows that a
5parent, guardian, or agent has authority to act on behalf of a
6minor or disabled person. "Proper authority" includes (1) an
7order issued by a court of law that shows that a guardian has
8authority to act on behalf of a minor or disabled person, (2) a
9written, notarized statement signed by a parent that expressly
10describes the authority of the parent to act on behalf of the
11minor, or (3) a durable power of attorney that complies with
12the Illinois Power of Attorney Act.
13    "Proper identification" means information generally deemed
14sufficient to identify a person. Only if the consumer is unable
15to reasonably identify himself or herself with the information
16described above, may a consumer reporting agency require
17additional information concerning the consumer's employment
18and personal or family history in order to verify his or her
20    "Military service member" means a resident of Illinois who
21is a member of any component of the U.S. Armed Forces or the
22National Guard of any state, the District of Columbia, a
23commonwealth, or a territory of the United States who has
24entered any full-time training or duty for which the service
25member was ordered to report by the President, the governor of
26a state, commonwealth, or territory of the United States, or



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1another appropriate military authority.
2    (r) Any person who violates this Section commits an
3unlawful practice within the meaning of this Act.
4(Source: P.A. 97-597, eff. 1-1-12; 97-1150, eff. 1-25-13;
598-486, eff. 1-1-14; 98-756, eff. 7-16-14.)