Originally published July 18 2005
Equifax head calls free credit report legislation "unconstitutional"
by Mike Adams, the Health Ranger, NaturalNews Editor
Legislation to allow consumers to obtain free credit reports to monitor for identity theft has come under fire from members of the credit reporting industry, especially Equifax CEO Thomas Chapman, who called the legislation unconstitutional because it would eat into credit reporting bureau profits, reports Wired News.
"..It's unconstitutional to cause a public company who has a fiduciary responsibility to return profit to shareholders to give away the product," Chapman said to reporters following a speech at the Commonwealth Club of California in San Francisco on Monday.
Chapman was referring to the Fair and Accurate Credit Transactions Act, which since last December has required credit agencies to provide consumers with a free copy of their credit report every 12 months to check for inaccuracies and fraudulent activity.
Chapman said that viewing a credit report once a year wouldn't protect consumers against fraud.
He initiated his appearance before the public affairs group after a recent spate of data security breaches made headlines and exposed the personal information of millions of consumers to identity thieves.
An Equifax spokesman said the company hopes to combat the loss of confidence consumers feel toward credit card companies and data brokers.
On the other hand, the company would like to prevent "legislative overkill" that could dull the competitive edge of American business.
Chapman discussed recent data breaches and the California notification law that requires companies to tell consumers when they experience a security breach -- a law that many credit with making consumers aware of data breaches that previously went unreported.
To ward off excessive legislation, Chapman supports the idea of tougher industry standards pressuring companies to encrypt data.
He noted that during a recent visit to a museum with his grandchildren, the cashier asked for his Social Security number as well as his home address and phone number when he tried to buy tickets with his credit card.
Preventing creditors from accessing information could affect the economy, he said, and if a consumer froze and unfroze their accounts repeatedly, it could lead creditors to view the consumer as having a lack of stability.
California was the first to adopt a law granting consumers that right.
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