After Warner bill becomes law, consumers now able to freeze, unfreeze credit for free

mark warnerThanks to bipartisan legislation authored by U.S. Sen. Mark Warner (D-VA), Virginia consumers will be able to freeze and unfreeze their credit files for free.

The free credit freezes – which experts say are one of the best tools available to protect against identity theft – are the result of a provision included in a bipartisan bill Sen. Warner wrote and introduced to boost economic growth and protect Virginia consumers. After five years of bipartisan negotiations that Sen. Warner helped lead, theEconomic Growth, Regulatory Relief, and Consumer Protection Act was signed into law by President Trump in May. Following a series of high-profile data breaches that have exposed consumers’ personal and financial information, the bill includes a provision requiring all three major credit agencies – Equifax, Experian and TransUnion – to allow consumers to freeze their credit for no fee.

“Credit freezes are one of the best ways that consumers can protect themselves against identity theft that could hurt their credit scores,” said Sen. Warner. “Good credit is essential if you want to buy a house, get a small business loan, or simply apply for a new credit card. Free credit freezes give consumers a new tool to protect themselves against criminals seeking to steal their identity.”

A security freeze makes it harder for criminals to use stolen information to open fraudulent accounts or borrow money using a stolen identity. Previously, credit bureaus charged as much as $10 per bureau to place a freeze on a consumer’s credit file. A similar fee would also be charged to temporarily remove the freeze if a consumer wanted to apply for new credit.  As a result, one study by the AARP found that fewer than 15 percent of American adults have ordered a security freeze on their credit more than a year after an enormous data breach at Equifax exposed the personal information, including Social Security numbers, birth dates, driver’s license numbers and other sensitive details, of about 148 million Americans, or nearly half the U.S. population.

With the provision in the law going into effect today, the three nationwide credit agencies – Equifax, Experian and TransUnion – must each set up a webpage for requesting fraud alerts and credit freezes. To place a credit freeze on their accounts, consumers will need to contact all three credit bureaus. The Federal Trade Commission has also posted links to those webpages on IdentityTheft.gov. Freezing prevents activity that could impact a consumer’s credit score – such as fraudulent loans taken out by someone who has stolen your identity.

Under the new law, parents can also freeze their children’s credit report. Because children generally have a clean credit slate, they are especially valuable for identity thieves; according to research, more than 1 million children were victims of identity theft last year, and two-thirds of them were age 7 or younger. Experian has estimated that one in four minors will be a victim of identity theft before reaching adulthood. 

In addition to providing free credit freezes and unfreezes, the Economic Growth, Regulatory Relief, and Consumer Protection Act included provisions to: 

  • Protect consumers’ credit by extending the duration of a fraud alert on a consumer’s credit report from 90 days to one year. A fraud alert requires businesses that check a consumer’s credit to get the consumer’s approval before opening a new account.
  • Provide free credit monitoring for all active-duty service members.
  • Protect the credit ratings of veterans wrongly penalized by medical bill payment delays by the Department of Veterans Affairs (VA).
  • Protect seniors by extending immunity from liability to certain people who disclose suspected exploitation of seniors.
  • Protect consumers from cyber security threats by requiring the Treasury Department to submit a report to Congress on the risks of cyber threats to financial institutions and the U.S. capital markets.

Sen. Warner’s bill is also providing needed relief for community banks and credit unions so they can support consumers in small and rural Virginia communities, where regulations designed for big banks have made it harder for small lenders to provide mortgages or loans to expand small businesses and family farms.                                                                                                               

Sen. Warner has also written legislation that would hold large credit reporting agencies like Equifax accountable for data breaches involving consumer data. The Data Breach Prevention and Compensation Act, which Sen. Warner introduced along with Sen. Elizabeth Warren (D-MA) back in January, would give the Federal Trade Commission (FTC) more authority to enforce data security and assess financial penalties on credit bureaus if they fail to adequately protect consumer data against theft. The bill has been referred to the Senate Banking Committee, of which Sen. Warner is a member.

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