05/05/2007 08:00 AM House JUDICIARY
| Audio | Topic |
|---|---|
| Start | |
| HB65 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 65 | TELECONFERENCED | |
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
HOUSE JUDICIARY STANDING COMMITTEE
May 5, 2007
8:19 a.m.
MEMBERS PRESENT
Representative Jay Ramras, Chair
Representative Nancy Dahlstrom, Vice Chair
Representative John Coghill
Representative Bob Lynn
Representative Ralph Samuels
Representative Max Gruenberg
Representative Lindsey Holmes
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
HOUSE BILL NO. 65
"An Act relating to breaches of security involving personal
information, credit report and credit score security freezes,
consumer credit monitoring, credit accuracy, protection of
social security numbers, care of records, disposal of records,
identity theft, furnishing consumer credit header information,
credit cards, and debit cards, and to the jurisdiction of the
office of administrative hearings; amending Rule 60, Alaska
Rules of Civil Procedure; and providing for an effective date."
- MOVED CSHB 65(JUD) OUT OF COMMITTEE
PREVIOUS COMMITTEE ACTION
BILL: HB 65
SHORT TITLE: PERSONAL INFORMATION & CONSUMER CREDIT
SPONSOR(s): REPRESENTATIVE(s) COGHILL, GARA
01/16/07 (H) PREFILE RELEASED 1/5/07
01/16/07 (H) READ THE FIRST TIME - REFERRALS
01/16/07 (H) L&C, JUD, FIN
01/31/07 (H) L&C AT 3:00 PM CAPITOL 17
01/31/07 (H) <Bill Hearing Canceled>
03/28/07 (H) L&C AT 3:00 PM CAPITOL 17
03/28/07 (H) Heard & Held
03/28/07 (H) MINUTE(L&C)
04/04/07 (H) L&C AT 3:00 PM CAPITOL 17
04/04/07 (H) <Bill Hearing Canceled>
04/16/07 (H) L&C AT 10:00 AM CAPITOL 17
04/16/07 (H) Scheduled But Not Heard
04/20/07 (H) L&C AT 3:00 PM CAPITOL 17
04/20/07 (H) Heard & Held
04/20/07 (H) MINUTE(L&C)
04/23/07 (H) L&C AT 3:00 PM CAPITOL 17
04/23/07 (H) Moved CSHB 65(L&C) Out of Committee
04/23/07 (H) MINUTE(L&C)
04/24/07 (H) L&C RPT CS(L&C) 2DP 3NR 1AM
04/24/07 (H) DP: GATTO, NEUMAN
04/24/07 (H) NR: BUCH, LEDOUX, OLSON
04/24/07 (H) AM: GARDNER
05/02/07 (H) JUD AT 1:00 PM CAPITOL 120
05/02/07 (H) Heard & Held
05/02/07 (H) MINUTE(JUD)
05/05/07 (H) JUD AT 8:00 AM CAPITOL 120
WITNESS REGISTER
FRANK BAILEY, Special Assistant;
Legislative Liaison/Communications
Office of the Commissioner
Department of Administration (DOA)
Juneau, Alaska
POSITION STATEMENT: During discussion of HB 65, testified on
Amendment 10.
JOHN BURTON, Vice President
State Government Affairs
ChoicePoint Asset Company ("ChoicePoint")
Alpharetta, Georgia
POSITION STATEMENT: Provided comments during discussion of HB
65.
REPRESENTATIVE LES GARA
Alaska State Legislature
Juneau Alaska
POSITION STATEMENT: Testified as one of the bill's joint prime
sponsors on the amendments to HB 65.
JANE W.PIERSON, Staff
to Representative Jay Ramras
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Explained new Amendment 1 to HB 65.
CHRIS ASHENBRENNER, Interim Program Administrator
Council on Domestic Violence & Sexual Assault (CDVSA)
Department of Public Safety (DPS)
Juneau, Alaska
POSITION STATEMENT: Testified on HB 65.
LORI DAVEY, Owner
Motznik Information Services, Inc.
Anchorage, Alaska
POSITION STATEMENT: Testified on HB 65.
RICK SVOBODNY, Deputy Attorney General
Central Office
Criminal Division
Department of Law (DOL)
Juneau, Alaska
POSITION STATEMENT: Provided comments and responded to
questions during discussion of HB 65.
DOUG WOOLIVER, Administrative Attorney
Administrative Staff
Office of the Administrative Director
Alaska Court System (ACS)
Anchorage, Alaska
POSITION STATEMENT: Testified on HB 65.
CLYDE (ED) SNIFFEN, Jr., Senior Assistant Attorney General
Commercial/Fair Business Section
Civil Division (Anchorage)
Department of Law (DOL)
POSITION STATEMENT: Provided comments and responded to
questions during discussion of HB 65.
ACTION NARRATIVE
CHAIR JAY RAMRAS called the House Judiciary Standing Committee
meeting to order at 8:19:27 AM. Representatives Holmes,
Gruenberg, Dahlstrom, Coghill, Samuels, Lynn, and Ramras were
present at the call to order.
HB 65-PERSONAL INFORMATION & CONSUMER CREDIT
8:19:52 AM
CHAIR RAMRAS announced that the only order of business would be
HOUSE BILL NO. 65, "An Act relating to breaches of security
involving personal information, credit report and credit score
security freezes, consumer credit monitoring, credit accuracy,
protection of social security numbers, care of records, disposal
of records, identity theft, furnishing consumer credit header
information, credit cards, and debit cards, and to the
jurisdiction of the office of administrative hearings; amending
Rule 60, Alaska Rules of Civil Procedure; and providing for an
effective date." [Before the committee was CSHB 65(L&C), as
amended on 5/2/07; left pending from the meeting on 5/2/07 was
the motion to adopt Amendment 1 and the motion to adopt
Amendment 10; included in members' packets was a proposed
committee substitute (CS) for HB 65, Version 25-LS0311\M,
Bannister, 5/3/07.]
8:21:49 AM
REPRESENTATIVE DAHLSTROM moved [to adopt] the proposed committee
substitute (CS) for HB 65, Version 25-LS0311\M, Bannister,
5/03/07, [as the work draft].
REPRESENTATIVE HOLMES objected.
CHAIR RAMRAS, in response to a question, stated that Version M
only contains the amendments previously made to the bill.
REPRESENTATIVE HOLMES removed her objection.
8:26:18 AM
CHAIR RAMRAS stated that Version M was before the committee.
CHAIR RAMRAS made a motion to adopt new Amendment 10, labeled
25-LS0311\E.15, Bannister, 5/2/07, and containing handwritten
changes to reflect a change to Version M; new Amendment 10
reads:
Page 20, lines 9 - 10:
Delete "or $5,000, whichever amount is greater,"
REPRESENTATIVE HOLMES objected for the purpose of discussion.
CHAIR RAMRAS explained that new Amendment 10 would allow
individuals to recover actual damages.
REPRESENTATIVE COGHILL, as one of the bill's joint prime
sponsors, spoke in favor of Amendment 10, but cautioned that it
would allow the recovery of both economic and noneconomic
damages. In the event of a class action suit, he opined,
damages could become untenable.
CHAIR RAMRAS offered his support for Amendment 10.
REPRESENTATIVE HOLMES removed her objection. There being no
further objection, new Amendment 10 was adopted.
8:29:27 AM
CHAIR RAMRAS [made a motion to adopt] Amendment 11, labeled 25-
LS-0311\M.2, Bannister, 5/4/07, which read:
Page 26, lines 29 - 30:
Delete "assembling or evaluating consumer credit
information or other information on consumers"
Insert "maintaining consumer credit information"
REPRESENTATIVE COGHILL objected.
8:31:21 AM
FRANK BAILEY, Special Assistant; Legislative
Liaison/Communications, Office of the Commissioner, Department
of Administration (DOA), relayed that the new Amendment 10
addresses DOA's concerns.
8:31:56 AM
JOHN BURTON, Vice President, State Government Affairs,
ChoicePoint Asset Company ("ChoicePoint"), asked for
clarification on Amendment 11, then explained that he had worked
with the sponsor's staff in order to clarify the definitions of
"consumer credit reporting agency" and "credit report". He
offered that ChoicePoint supports the use of these terms because
they mirror the definitions in the federal Fair Credit Reporting
Act (FCRA). He explained that the term "consumer report" as
defined in the FCRA, is an umbrella term used by the Federal
Trade Commission (FTC) to govern everything it regulates, while
the term "credit report" is a consumer report as defined in
federal law. However, the FTC regulates other areas that do not
involve credit or credit data. He opined that HB 65 correctly
focuses on a credit score security freeze but does not extend to
other consumer data such as lost data or data for fraud
prevention, data which are not used for credit purposes. He
stated that the two definitions together help conform the bill
to a credit report, which is the subject of a credit score
security freeze.
8:36:27 AM
REPRESENTATIVE LES GARA, Alaska State Legislature, speaking as
one of the joint prime sponsors of HB 65, offered that
[Amendment 10 and Amendment 11] work together. He stated that
Version M reflects the Illinois language, and perhaps other
states' consumer protection laws, which mirror definitions in
federal law for a "consumer credit reporting agency" and a
"credit report". He opined that the cumulative effect of the
two amendments is to allow companies, like ChoicePoint, to
distribute some of an individual's information even when he/she
places a credit freeze on his/her personal information. For
example, he indicated that some information might be relevant
only to credit scoring, or to insurance products. But absent
the adoption of [Amendment 11], Choice Point would be prevented
from using that information while the individual has placed a
freeze on his/her information. He offered that he could not
determine any adverse impact to consumers, although he also
noted that he has not heard any criticism of Illinois law. He
opined that a person who has been a victim of identity theft or
credit theft has a right to a broader freeze on his/her
information, and so he supports the Illinois language.
REPRESENTATIVE COGHILL referred members to page 26 and indicated
that the operative part of this section is for the purpose of
furnishing credit reports to third parties. He suggested that
if other information is relevant to furnishing a credit report
it should be included in the bill. He stated that he speaks
against Amendment 11.
MR. BURTON suggested that it is important to note that Illinois
subsequently amended their credit freeze law to limit it to a
credit report and extensions of credit. He offered that in lieu
of not narrowing the definition of a "credit report" and a
"credit reporting agency", ChoicePoint urges the committee to
adopt the Illinois law definition for "security freeze".
CHAIR RAMRAS withdrew Amendment 11.
REPRESENTATIVE GARA clarified that the version of the Illinois
law attached to Amendment 11 is dated 2007. He acknowledged
that Illinois law may have since been updated, as Mr. Burton
indicated, and that he will research the matter.
8:40:22 AM
CHAIR RAMRAS made a motion to adopt Amendment 12, labeled 25-
LS0311\M.3, Bannister, 5/4/07, which read:
Page 27, lines 1 - 11:
Delete all material and insert:
"(3) "credit report" means a written, oral,
or other communication of credit information by a
consumer credit reporting agency bearing on a
consumer's credit worthiness, credit standing, or
credit capacity;"
REPRESENTATIVE COGHILL objected.
CHAIR RAMRAS explained that Amendment 12 will delete paragraph
(3) of proposed AS 45.48.990, and will insert a new definition
for "credit report".
MR. BURTON explained that since the initial passage of credit
freeze legislation in California in 2001, the legislative intent
and public policy behind these types of bills is to allow a
consumer to freeze his/her credit report as protection against
identity theft. If it is the intent of anyone that this bill
should be a manner for consumers to opt out or freeze things
beyond a credit report, then he stated he believes the bill goes
beyond the original intent. He suggested that if the sponsor or
committee wishes to adopt the Illinois language, then the
Illinois law should be adopted in its entirety, and that the
focus of the bill should be clear. He opined that the overall
goal of the bill is to protect consumers by allowing them to
freeze their credit reports as protection against identity theft
and unauthorized extensions of credit.
CHAIR RAMRAS withdrew Amendment 12.
8:43:32 AM
[Left pending from the meeting on 5/2/07 was the motion to adopt
Amendment 1, labeled 25-LS0311\E.12, Bannister, 5/1/07.]
CHAIR RAMRAS made a motion to adopt a new Amendment 1, labeled
25-LS0311\M.4, Bannister, 5/4/07, which read:
Page 1, line 1, following "to":
Insert "the disclosure of permanent fund dividend
applicant records,"
Page 2, following line 2:
Insert new bill sections to read:
"* Sec. 2. AS 43.23.017 is amended to read:
Sec. 43.23.017. Applicant information
confidential. Information on each permanent fund
dividend application, except the applicant's name, is
confidential. The department may only release
information that is confidential under this section
(1) to a local, state, or federal
government agency;
(2) in compliance with a court order;
(3) to the individual who or agency that
files an application on behalf of another;
(4) to a banking institution to verify the
direct deposit of a permanent fund dividend or correct
an error in that deposit;
(5) as directed to do so by the applicant;
[AND]
(6) to a contractor who has a contract with
a person entitled to obtain the information under (1)
- (5) of this section to receive, store, or manage the
information on that person's behalf; a contractor
receiving data under this paragraph may only use the
data as directed by and for the purposes of the person
entitled to obtain the information; and
(7) as provided under (b) of this section.
* Sec. 3. AS 43.23.017 is amended by adding new
subsections to read:
(b) The department shall disclose applicant
information to a business under a contract with the
department that requests the applicant information if
the business has a license under AS 43.70.020, the
business, or an agent, an employee, or a contractor of
the business, indicates that the business will use the
applicant information only in the normal course of
business, the person making the request provides proof
of the person's identity, and the person making the
request states that the business will use the
applicant information only
(1) to obtain information for law
enforcement agencies or for an investigation, if the
business is the practice of law or includes the
service of process;
(2) in connection with a civil, a criminal,
an administrative, or an arbitration proceeding,
including the service of process, investigation in
anticipation of litigation, executing on a judgment,
enforcing a judgment, or complying with a court order;
(3) for a legal or beneficial interest
relating to the applicant, if the business holds the
legal or beneficial interest;
(4) on behalf of the applicant, if the
business is acting in a fiduciary capacity on behalf
of the applicant;
(5) in connection with insurance claims,
insurance investigations, or insurance anti-fraud
activities, if the business is an insurer or a person
who provides support services to an insurer;
(6) to comply with federal, state, or
municipal laws, regulations, ordinances, or other
legal requirements; or
(7) for bulk distribution to political
candidates, nonprofit organizations, or persons taking
polls.
(c) In this section,
(1) "applicant" means an applicant for a
permanent fund dividend;
(2) "applicant information" means name,
mailing address, and birth year of an applicant;
(3) "business" means a person engaging in
business."
Renumber the following bill sections accordingly.
Page 27, line 23:
Delete "sec. 3"
Insert "sec. 5"
Page 27, line 27:
Delete "sec. 3"
Insert "sec. 5"
Page 27, line 30:
Delete "sec. 3"
Insert "sec. 5"
Page 28, line 1:
Delete "sec. 4"
Insert "sec. 6"
REPRESENTATIVE HOLMES objected for the purpose of discussion.
8:45:33 AM
JANE W. PIERSON, Staff to Representative Jay Ramras, Alaska
State Legislature, explained the changes from the old Amendment
1, Version E.12, to the new Amendment 1, Version M.4. She
referred to new Amendment 1, and explained that the major change
reflects that the Department of Revenue (DOR) shall disclose
Permanent Fund Dividend (PFD) applicant information to a
business under contract with the department. This change allows
the department set up a contract similar to how the Division of
Motor Vehicles (DMV) handles confidential information. She
explained that new Amendment 1 no longer stipulates that the
information can only be used as necessary to implement or
enforce a transaction authorized by the applicant because the
business would already have been given that information by the
applicant; that subsection (b)(1) now says in part "obtain
information for law enforcement agencies" and no longer contains
the term "self-regulatory organization" because the term was
deemed unnecessary and poorly defined; and that [subsection (b)]
no longer contains the words "to verify the accuracy of
information provided by the applicant, to prevent fraud by the
applicant, or to pursue legal remedies against the applicant"
because it refers to information provided by the applicant.
MS. PIERSON stated that the term, "nonprofit" was supposed to
have been removed from new Amendment 1's subsection (b)(7) to
reflect that the information being released is available to all
organizations not just non-profit organizations. She gave an
example that one hospital might be non-profit, and another
hospital might not be, so the effect of removing "non-profit"
from the new Amendment 1 would be to open access to information
for all organizations.
MS. PIERSON, in response to a question, advised that the term
"organization" is not defined in statute, and in response to a
concern that an organization seeking information might be a
terrorist organization, responded that an organization seeking
information could also be a local little league. Furthermore,
there will be contractual obligations between the department and
the person gathering the information, and that's where
restraints will be.
REPRESENTATIVE GRUENBERG noted that that language might be
broader than needed.
REPRESENTATIVE COGHILL asked with respect to the first change in
new Amendment 1, if this is to mirror the type of contract that
DMV lets.
MS. PIERSON, in response, confirmed that the change would allow
businesses to obtain and use applicant information for bulk
distribution to political candidates or persons taking polls and
is intended replicate the type of contract DMV enters into.
REPRESENTATIVE COGHILL asked what criteria would be used in a
potential contract.
MS. PIERSON offered that the criteria could be defined by
regulation by the Permanent Fund Dividend Division, Department
of Revenue.
8:50:15 AM
REPRESENTATIVE SAMUELS asked why information would be limited to
businesses and not to individuals. He said he recognizes that
some businesses sell formatted information.
REPRESENTATIVE RAMRAS made a motion to amend new Amendment 1 to
delete "non-profit organizations" from proposed subsection
(b)(7).
REPRESENTATIVE GRUENBERG said he doesn't have a problem deleting
"non-profit", but urged that it is essential to define
"organizations" in statute and not leave the term to be defined
by regulation.
MS. PIERSON, in response to a question, offered her belief that
it would make more sense to delete "nonprofit organizations"
from new Amendment 1, rather than just deleting "non-profit".
CHAIR RAMRAS asked if there were any objections to the amendment
to new Amendment 1. There being none, the new Amendment 1 was
amended.
REPRESENTATIVE GRUENBERG asked if members would consider another
amendment to new Amendment 1, as amended, to delete the word
"business" from proposed subsection (b) because the definition
of the word "person" includes business.
REPRESENTATIVE LYNN surmised that the same argument regarding
paragraph (7) could also apply to subsection (b)'s other
paragraphs. He cautioned that the language should not be
centered on any particular business.
REPRESENTATIVE COGHILL noted that subsection (b) uses the term,
"business" several times but cautioned that in at least one
instance it should remain.
REPRENTATIVE GRUENBERG agreed.
REPRESENTATIVE GARA offered his understanding that the
suggestion is logical in terms of consistency, but reminded the
committee that Senator Guess's original amendment, he opined,
was meant to ensure that a party has a legitimate reason for
obtaining an applicant's address. By leaving in the word
"business", as new Amendment 1, as amended, is currently
written, it makes a policy call that some businesses
legitimately need to obtain addresses in order to operate. By
expanding the scope of new Amendment 1, as amended, to make this
information available to individuals, it might inadvertently
make information available to a class of people who do not have
a right to confidential information. If the scope remains
narrowed only to businesses, he opined, it seems more likely
that someone with a vendetta probably would not have access to
confidential information. He cautioned that once the scope of
the bill is broadened to a person, any of the 600,000 or so
Alaskans who file for a PFD might find a way to access
confidential information.
REPRESENTATIVE SAMUELS, in response to a question, said he now
understands why subsection (b) narrows the scope to just
businesses, and he will decide whether he agrees.
The committee took an at-ease from 8:57 a.m. to 9:01 a.m.
9:01:14 AM
REPRESENTATIVE LYNN made a motion to adopt a second amendment to
new Amendment 1, as amended; this second amendment read
[original punctuation provided]:
Page 2, line 24
Add: "Applicant information for bulk distribution to
political candidates in an election shall also be
disclosed directly to a candidate who has filed a
declaration of candidacy or letter of intent to run in
that election."
REPRESENTATIVE COGHILL objected. He suggested that if new
Amendment 1, as amended, passes as is, he would continue to work
to address the underlying issues raised.
Representative Gruenberg noted that the committee could not
amend an amendment to an amendment. The committee could either
adopt this second amendment and then take up a third amendment,
or the second amendment could be withdrawn so that he could
draft better language.
REPRESENTATIVE LYNN withdrew the second amendment to new
Amendment 1, as amended.
REPRESENTATIVE GARA recapped that the withdrawn second amendment
to new Amendment 1, as amended, stated that not only can a
company obtain the information to help candidates but if a
candidate chose not to hire a company, the candidate could
obtain the information directly. He stated his neutrality in
the matter of whether to adopt this change, but offered his
interpretation that if the purpose of the second amendment to
Amendment 1 is to allow candidates to obtain information without
hiring a company to obtain it, then the amendment must also
specify party or candidate; that not only can a business obtain
the information but an individual can also.
9:04:34 AM
REPRESENTATIVE GRUENBERG made a motion to adopt a new conceptual
amendment to new Amendment 1, as amended.
CHAIR RAMRAS [after some discussion regarding what the exact
wording would be] relayed that the second conceptual amendment
to new Amendment 1, as amended, would, in addition to making
conforming changes to the entirety of new Amendment 1, as
amended, add to the end of proposed subsection (b)(7) the words:
Applicant information for bulk distribution to
political candidates in an election shall also be
disclosed directly to a candidate who has filed a
declaration of candidacy or letter of intent to run in
that election or to a recognized political party"
CHAIR RAMRAS added that Amendment 1 should be made to
conform to new Amendment 1.
REPRESENTATIVE COGHILL objected, suggesting that the amendment
be prepared by the legislative drafters.
REPRESENTATIVE HOLMES asked why the language was changed several
years ago with respect to the domestic violence aspect.
REPRESENTATIVE SAMUELS stated that he agrees and more fully
understands why the information should only be released to a
business and not to an individual. He stated he opposes the
amendment to new Amendment 1, but supports the language in the
bill.
REPRESENTATIVE DAHLSTROM indicated that she is concerned with
both the new Amendment 1, as amended, and the second amendment
to the Amendment 1 because the information being considered for
release is within the only database in the state that lists
specific information about children.
REPRESENTATIVE LYNN opined that most candidates are as
responsible as business owners, and that merely holding a
business license does not make a person more responsible or less
likely to commit a crime.
REPRESENTATIVE HOLMES asked for testimony with respect to
domestic violence and whether it makes a difference if the
information is released to a business or a candidate.
9:10:55 AM
CHRIS ASHENBRENNER, Interim Program Administrator, Council on
Domestic Violence & Sexual Assault (CDVSA), Department of Public
Safety (DPS), offered her view that any narrowing of access to
the PFD applicant database will help to protect children. She
stated that it seems that the second amendment to new Amendment
1, as amended, would broaden access to confidential information,
but that she is uncertain of its effect on potential victims.
9:11:37 AM
A roll call vote was taken. Representatives Gruenberg and Lynn
voted in favor of the second amendment to new Amendment 1, as
amended. Representatives Dahlstrom, Coghill, Samuels, Holmes,
and Ramras voted against it. Therefore, the second amendment to
new Amendment 1, as amended, failed by a vote of 2-5.
CHAIR RAMRAS indicated that new Amendment 1, as amended, was now
before the committee.
MS. ASHENBRENNER expressed concern about the specific personal
information that might be made available to those individuals
who prey on others, for example, domestic violence offenders,
stalkers, or sex offenders. The CDVSA sees the growth of cyber-
stalking and this amendment would certainly enhance the ability
of predators to stalk. Initially, she said, she was excited
about the protection this bill might offer individuals, since
some people have been tracked down by their credit report.
However, new Amendment 1, as amended, makes specific
confidential information available to potential predators, and
so she has grown concerned about the broader aspect of
confidential information that would be released. She suggested
that the committee consider narrowing the scope of the bill in
order to protect potential victims. She opined that this
protection is especially important given the extremely high
rates of victims of domestic violence and sexual assault in all
parts of Alaska.
9:14:41 AM
LORI DAVEY, Owner, Motznik Information Services, Inc.
("Motznik"), began by offering her view that the value of the
bill is more to protect victims than to find victims. She
explained that by reauthorizing access to the PFD applicant
database for legitimate business purposes allows Motznik to
definitively locate people to serve process, to track their
criminal record, and to effectively differentiate between
criminals and those who are not. Businesses can currently
access public information which contains names and addresses.
The Division of Elections has the ability to update the voter
registration files and to cross reference with the PFD files,
and this would provide access to the information of about 90
percent of Alaskans. The remaining 10 percent missing from such
a cross-referenced list would be the people who are not
registered voters. It is currently very difficult to
differentiate between people with common first or last names.
MS. DAVEY offered that new Amendment 1, as amended, would
reauthorize access to addresses and birth years in order to
differentiate between the non-criminal files. This personal
information is routinely used for employment, title searches,
home loans, housing, and similar uses. It is important for
businesses to be able to effectively validate a person and to
clearly identify whether the person is a criminal or not. She
offered that currently a private investigator, a title company,
or an attorney must obtain a court order to access specific PFD
applicant information. Additionally, removing "non-profit
organizations" entirely eliminates the ability for a little
league, a private school, or summer camp to access the
information for bulk distribution.
REPRESENTATIVE DAHLSTROM asked if Motznik is the only business
in the state that provides these data services.
MS. DAVEY responded no and offered that another company provides
the same services.
REPRESENTATIVE DAHLSTROM advised that she, as a parent of four
children, has not experienced mass mailings from any private
school or little league program. She cautioned that there isn't
a need for these types of programs to advertise in this way
since the programs often have lines or waiting lists.
CHAIR RAMRAS questioned whether making this information
available would put people at risk.
MS. DAVEY responded no because access to the information helps
make people more accountable, adding that currently it is
difficult to track someone down if they do not vote, do not own
a car, or do not own property. She related that if someone is
stalking a person, in order to gain protection, the victim must
serve the stalker with a restraining order and in order to do so
he/she must be able to locate the stalker. The proposed change,
she opined would help the victim by allowing him/her to serve
the restraining order.
9:21:21 AM
RICK SVOBODNY, Deputy Attorney General, Central Office, Criminal
Division, Department of Law (DOL), in response to a question,
offered that the DOL uses the services of both aforementioned
businesses in order to locate witnesses or defendants, along
with other tools such as the PFD applicant database. While he
offered that these are all useful tools, he also acknowledged
that some people use the information provided in these listings
to search for victims.
9:22:16 AM
REPRESENTATIVE COGHILL maintained his objection.
A roll call vote was taken on new Amendment 1, as amended.
Representatives Coghill, Samuels, Lynn, Ramras voted in favor of
the new Amendment 1,as amended, and Representatives Dahlstrom,
Holmes, and Gruenberg voted against it. Therefore, new
Amendment 1, as amended, was adopted by a vote of 4-3.
CHAIR RAMRAS suggested that Ms. Ashenbrenner continue her work
continue to reduce the negative aspects of the bill and to
address concerns expressed today as the bill moves through the
process.
9:24:47 AM
MR. SVOBODNY referred to Article 5, starting on page 23,
specifically the language regarding a court's determination of
factual innocence. He offered that the bill would make a
fundamental change with respect to how the court system
operates. He explained that Alaska's court system is an
adversarial system, with two opposing parties, with a judge and
jury who ultimately make a determination between the two
parties. This bill would change the court system to resemble
the Napoleonic system, the French system where the judge acts as
an inquisitor, and a person who petitions the court does not
have an opposing side. He opined that to make a fundamental
change such as this one deserves further consideration.
MR. SVOBODNY related two examples from his experience as a
prosecutor. In one instance someone used a different person's
name during a driving while under the influence (DUI) case plead
guilty and subsequently served the sentence. The effect was
that the innocent party unknowingly had a fraudulent DUI on
his/her record, including ramifications to his/her driver's
license and vehicle insurance. In another instance, a Juneau
woman discovered she had been convicted of prostitution in
Seattle, Washington, yet she had never been outside Juneau,
Alaska. He said he supports an identification system of some
type, but cautioned against the aforementioned fundamental
change to the court system. He asked for clarification, under
the bill, in which physical location a petition would be filed,
for example, if a person lives in Nome and someone in Juneau
steals the person's identity. He opined that the amendments
adopted today help provide for a burden of proof which satisfies
the DOL Criminal Division.
MR. SVOBODNY opined that the way the bill is currently drafted
is flawed. He referred to page 23, lines 23-24, and stated that
the second line in paragraph (2) appears to be redundant with
paragraph (1). He offered that as a general rule victims do not
file criminal complaints because the state files the complaint.
He pointed out that in proposed AS 45.48.100 (a)(1)-(3) as it is
currently written, because the word "and" separates the
paragraphs, all three paragraphs would have to apply, and
therefore no one could utilize the bill in order to establish
his/her innocence. He referred to line 29, and again, noted
this would be a change in the court system and it would be more
like the French system.
9:30:09 AM
CHAIR RAMRAS said he thought the drafting of proposed AS
45.48.600 had been fixed and asked Representative Coghill to
clarify.
REPRESENTATIVE COGHILL suggested that on page 23, line 24, in
paragraph (2) to delete "by the victim" in order that a criminal
complaint could be filed against the perpetrator. But he agrees
and confirmed that this bill would change the structure of legal
system, but that victims of identity or credit theft are
currently disenfranchised since the burden of proof to prove
their innocence rests with them.
CHAIR RAMRAS indicated that currently there is not a document
that will provide proof that the victim is innocent. The goal
of the bill is to provide a mechanism for documentation for
victims of identity theft who are not guilty of any wrongdoing.
REPRESENTATIVE DAHLSTROM said she agrees with the sponsor's
intent but asked if businesses affected by the unlawful charges,
or the theft of services are required to recognize the
certificate and erase the debt in order for the credit agency to
clear the individual's name, and questioned the value of a
certificate.
MR. SVOBODNY offered that his testimony is given from the point
of view of a prosecutor and for the victim of fraud or theft,
whose name will be associated with a criminal conviction. He
expressed concern for the victim and the far reaching impacts,
for example, having his/her future credit denied at a store in a
village. He opined that as drafted, he is not sure that this
bill will address that concern, but again suggested that perhaps
someone else could provide more specific guidance.
REPRESENTATIVE COGHILL cautioned that if Article 5 is removed,
the committee should consider strengthening the penalty section,
and cited the reason as being the specific effect on the victims
of identity theft.
CHAIR RAMRAS offered that identity theft is unique in that it
does require a certificate to absolve the victim, and without a
police report to validate that theft, an individual cannot
verify his/her innocence.
9:37:14 AM
DOUG WOOLIVER, Administrative Attorney, Administrative Staff,
Office of the Administrative Director, Alaska Court System
(ACS), explained, that there are some sections that need further
work, and relayed his willingness to work with the bill's
sponsor. With respect to deleting Article 5, he said he wanted
to make members aware that the Alaska Supreme Court Advisory
Committee on Criminal Rules is considering a proposal to deal
with this issue. He offered to provide a copy of the draft
proposal and to report the status of any rule change with the
committee. He said he believes that the ACS is considering an
amendment to the Alaska Rules of Criminal Procedure, rule 43,
Dismissal and Deferred Prosecution. Under the proposed court
rule change, once an identity theft case is dismissed, the
prosecutor would file a certificate to indicate that the
individual in question is not the person who committed the
crime. He opined that the court is unlikely to find a person
cleared of wrongdoing without some type of certification from
the prosecutor to confirm the person's innocence.
CHAIR RAMRAS referred to page 25, line 7, proposed AS 45.48.680,
Right to file a police report regarding identity theft. He
explained that this section would treat identity theft like a
property loss. He related personal experiences of property
losses that did not have good outcomes with respect to law
enforcement in Fairbanks. He cautioned that a person facing
identity theft might not have assurance that the police would
take enforcement action or write a police report, as he had
experienced, so that the court could issue a certificate of
innocence.
Mr. SVOBODY responded that he agrees with the concept of the
bill, but wanted to point out concerns with the current language
and cautioned that the legislature should work out the details
and not leave it to the courts to decide, or to prosecutors to
provide specific remedies. He speculated that there will always
be abuses of the system, just as currently happens with some
domestic violence petitions, and expressed concern that some
people might use the proposed certificate of innocence to
defraud their creditors. He offered support for the type of
system where a victim outlines the crime and the accused
responds to the allegation.
9:41:54 AM
CLYDE (ED) SNIFFEN, Jr., Senior Assistant Attorney General,
Commercial/Fair Business Section, Civil Division (Anchorage),
Department of Law (DOL), responding to a question, with respect
to a process that results in a certificate or an order to the
court and whether the certificate has any value, offered that a
certificate would be useful because identity theft victims
suffer from creditors trying to collect on debt. When a victim
doesn't pay the debt because he/she doesn't know the debt
exists, the delinquency gets reported to the credit bureau. The
credit bureau initiates collection proceedings and that action
harms the consumer. With a certificate or an order from the
court that clears the victim, he/she would have proof to give to
the creditor that he/she did not incur the debt.
MR. SNIFFEN said that protection is currently offered, no matter
what state the creditor resides in, since the creditor is
obligated under the Fair Debt Practices Act (FDPA) to only
proceed against the party if it has a good faith belief that the
individual is liable. When a person has a certificate from the
court certifying that he/she is not guilty, the credit bureau
must correct his/her credit report. He offered that the
proposed certificate would have a positive effect to help repair
damages done to consumers who have been victims of identity
theft. He commented on Article 5, which he stated has utility
and is why DOL supports the bill, but he agrees with Mr.
Svobodny that there are some factual issues that could be
addressed to satisfy some concerns.
MR. SNIFFEN described that the current system involves a victim
but also has another person to argue against the allegation in
order to test out the evidence. But the appearance of a new
type of crime, identity theft, might also require a new approach
to solve it, one in which the judge would act as the arbitrator
to determine whether that information is correct or if it is an
attempt by a party to fraudulently charge debt and subsequently
clear his/her record.
9:44:38 AM
CHAIR RAMRAS made a motion to adopt Conceptual Amendment 13, on
page 23, line 24, to delete "by the victim". There being no
objection, Conceptual Amendment 13 was adopted.
CHAIR RAMRAS opined that while Article 5 is imperfect, he
preferred to leave it as is in order to provide a buffer for
victims of identity theft until the aforementioned court rule
changes are adopted. He suggested that perhaps subsequent
legislation might be required.
REPRESENTATIVE COGHILL commented that that point was well taken,
which is that victims of identity theft must be able to protect
themselves with the assistance of the court. He offered to
continue work on this issue.
9:46:52 AM
MR. BURTON expressed concern with the changes made to Articles 3
and 4. ChoicePoint supports the efforts to regulate any public
display of social security number (SSN) by a general business or
any commercial user, and also supports strong penalties for
those who use SSNs in an inappropriate way, or who
misappropriate the identities of others for fraud or to
otherwise harm individuals. He offered that his concerns with
proposed changes to AS 45.48.400 have been addressed. But he
still has concerns with proposed changes to AS 45.48.410-430.
He stated that he is unsure of the legislative intent and legal
implications of these sections. ChoicePoint concerns were
validated earlier in the week during prior testimony when it
became unclear that there was confusion about what was or was
not permitted.
MR. BURTON said it is clear that no one should be able to sell
an SSN or a list of SSNs or purchase the aforementioned lists on
the Internet. Yet, every day millions of businesses and
governments transact legitimate business and a SSN number is
included as part of the larger transaction. These transactions
may be business to business, consumer to business, or business
to government. In those transactions the SSN is not used as
anything of value, but the SSN is still the single most critical
element to verify and authenticate an individual's identity.
The SSN is used to prevent fraud and to ensure the accuracy of
data as it exchanges hands between entities. Currently, use of
the SSN is governed and restricted under the federal regulatory
structure, primarily by the FCRA, the federal Gramm-Leach Bliley
Act (GLBA), the Driver's Privacy Protect Act of 1994,(DPPA), and
the United States of America's Patriot Act.
MR. BURTON offered that the bill creates prohibitions, but also
include some exemptions to them. He cautioned that these
sections of the bill are not yet clear and must provide
considerations to allow existing commerce under these four
regulatory structures. He respectfully requests further review
on the issues with respect to the prohibitions.
REPRESENTATIVE COGHILL expressed a willingness to consider the
issues that were raised.
9:52:48 AM
CHAIR RAMRAS, after determining that no one else wished to
testify, closed public testimony on HB 65.
REPRESENTATIVE COGHILL agreed with the concept that information
needs to move freely in business and commerce, but cautioned
that there must also be protections for individuals who suffer
the consequences of identity theft, especially since it also
affects the ability of an individual to pass through customs.
He again pledged to continue working on HB 65.
REPRESENTATIVE SAMUELS asked that his concern about the method
of payment of fees by individuals who are victims of identity
theft and who would no longer have access to a valid credit card
be addressed.
9:55:21 AM
REPRESENTATIVE COGHILL moved to report the proposed CS for HB
65, Version 25-LS0311\M, Bannister, 5/3/07, as amended, out of
committee with individual recommendations and the accompanying
fiscal notes. There being no objection, CSHB 65(JUD) was
reported from the House Judiciary Standing Committee.
ADJOURNMENT
There being no further business before the committee, the House
Judiciary Standing Committee meeting was adjourned at 9:55 a.m.
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