A coalition of Democratic senators has introduced the Freedom from Equifax Exploitation (FREE) Act, a stated effort “to give control over credit and personal information back to consumers.”

A data breach recently announced by consumer credit rating firm compromised the personal information of as many as 143 million Americans. It “highlighted just how little control consumers have over the collection, use, and sale of their own credit data,” proponents of the legislation said in a statement.

“Credit reporting agencies like Equifax make billions of dollars collecting and selling personal data about consumers without their consent, and then make consumers pay if they want to stop the sharing of their own data,” said Sen. Elizabeth Warren (D-Mass.). “Our bill gives consumers more control over their own personal data and prohibits companies like Equifax from charging consumers for freezing and unfreezing access to their credit files. Passing this bill is a first step toward reforming the broken credit reporting industry.”

Credit reporting agencies like Equifax collect personal financial data on millions of Americans and earn billions of dollars in annual revenue selling this information to others. If consumers wish to limit how credit reporting agencies use this information, such as by placing a credit freeze on their credit file, they often have to pay a fee to the agency, even though consumers never gave the agency permission to collect their data in the first place. 

The Freedom from Equifax Exploitation Act would:

create a uniform, federal process for obtaining and lifting a credit freeze (currently, there is no federal requirement for credit reporting agencies to offer consumers a credit freeze, and consumer rights vary widely depending on which state they live in); 

require credit reporting agencies to allow consumers to impose, temporarily lift, or permanently remove a credit freeze for free;

prevent the credit reporting agencies from profiting off the use of consumers’ information for the duration of their credit freeze;

enhance fraud alert protections and allow consumers to request that a fraud alert be included in their credit file if they have suspicion that they were harmed by the unauthorized disclosure of their personal identifying information;

extend the length of the alert from 90 days to one year, which can be renewed for an additional year;

provide for a renewable 7-year fraud alert in the case of identity theft, during the course of which credit reporting agencies are prohibited from including the consumer on a marketing list.    

allow consumers to get a refund on any fee credit reporting agencies charged them to impose a credit freeze in the wake of the Equifax breach;

provide the opportunity for consumers to get an additional free credit report; and

force Equifax and the other credit reporting agencies to refund any fees they charged for credit freezes in the wake of the Equifax data breach.

The bill was sponsored by Warren, and Senators Bob Menendez (D-N.J.) and Brian Schatz (D-Hawaii). Original co-sponsors of the legislation include Senators Chris Van Hollen (D-Md.), Kirsten Gillibrand (D-N.Y.), Richard Blumenthal (D-Conn.), Edward J. Markey (D-Mass.), Bernie Sanders (I-Vt.), Ron Wyden (D-Ore.), Richard Durbin (D-Ill.), Jeff Merkley (D-Ore.), and Al Franken (D-Minn.).

 

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