Asm. Dodd Protects Consumers with Identity Theft Resolution Bill

SACRAMENTO – Assemblymember Bill Dodd (D-Napa) introduced new legislation to speed the resolution process for victims of identity theft who find themselves in debt collection. Current law does not require timeframes for debt collectors to investigate claims of identity theft or notify a consumer of the results of that investigation.

“Victims of identity theft deserve a resolution process that is transparent and performed as expeditiously as possible,” said Assemblymember Dodd. “Having experienced identity theft myself, I know firsthand the challenges and distress that comes as a result.”

According to the California Attorney General, identity theft occurs every 2.5 seconds, impacting over 12 million Americans and 1.5 million Californians every year. Identity theft occurs when perpetrators illegally use a person’s confidential information to make fraudulent purchases or apply for consumer loans in the victim’s name. As a result, innocent consumers often find themselves in debt collection or facing negative credit reports for failure to pay the charges or accounts unknowingly opened in their name.

“Identity theft can have damaging effects long after the crime has taken place. Many people only find out the crime has occurred once it appears on their credit report,” said Sonoma County District Attorney Jill Ravitch. “Consumers can spend months trying to navigate through a confusing and overwhelming system to remove the negative reporting. Any legislation that provides a more expedient resolution for cases of identity theft is a positive step for consumer protection.”

Consumers who dispute fraudulent accounts are too often forced through an unclear process that can take months to stop collections efforts and even more time to be rectified on the victim’s credit report. This lengthy resolution process can be particularly damaging for people attempting to secure a loan for a home or automobile.

“Identity theft is a very serious problem that affects millions of Californian’s each year. In Contra Costa County, our Consumer Protection Unit receives over five hundred complaints a year from residents who have become victims of consumer fraud and hundreds more from victims of identity theft,” said Contra Costa District Attorney Mark Peterson. “These victims deserve a faster resolution process. The introduction of this legislation is a step towards helping ordinary citizens deal with the nightmare that results from being the victim of the crime of identity theft.”

Dodd’s bill would dramatically reduce the time frame for debt collection companies to review the consumer’s identity theft dispute and also ensures that consumers be notified of how their dispute was resolved, regardless of the outcome. The bill would also require debt collection companies to provide updates to the credit bureaus on the status of the fraudulent accounts in a more timely manner, which can help victims who are paying higher interest or denied credit due to fraudulent charges.

Assemblymember Bill Dodd represents the 4th Assembly District, which includes all or portions of Napa, Yolo, Sonoma, Lake, Solano, and Colusa Counties. You can learn more about Assemblymember Dodd and the district at www.asm.ca.gov/dodd.