Feds Lag On ID Theft Notification

Laws Needed To Notify Consumers When Identity Compromised

(AP) 
Other companies, including Bank of America Corp., DSW Shoe Warehouse and BJ's Wholesale Club Inc., have also faced recent problems with data theft.

If it were not for California's law, which went into effect in 2003, consumers might not have known that any of this was even going on. Under that state's rules, companies must notify residents whenever sensitive personal data has been compromised.

And since many large companies do business in California, when they comply with that law consumers around the country end up learning about a security breach.

Illinois and Washington have recently passed bills dealing with identity theft and a handful of others are considering legislation.

But the big push is for Congress to do the same. A number of bills requiring notification and higher security standards for personal data have been working their way through committees in both the House and the Senate.

"Hardly a week goes by without startling new examples of breaches of sensitive personal data reminding us how important it is to pass a comprehensive identity theft prevention bill in Congress quickly. Consumers' personal and financial data has become the gold of the 21st century and we need to protect it accordingly," said Sen. Charles Schumer, D- N.Y.

Schumer has introduced legislation on identity theft with Sen. Bill Nelson, D-Fla. His comments came last week after the credit-card breach was made public.

But to date no bill has reached the mark-up stage, which means that with Congress about to leave for its summer recess, it will be the fall, and maybe well after that, before any measure advances.

Such legislation may only be passed if Washington lawmakers can stand up to pressures coming from the financial services industry.

While many groups in that sector say they support rule changes, they are pushing to keep some control over what circumstances would trigger a notification requirement. They say there is a risk of flooding consumers with warnings, making them numb to the most serious threats.

Lets hope that such concerns don't railroad potential legislation. Consumers can't afford that to happen.