Last Updated on: 27th October 2023, 06:55 pm

An Attorney’s Guide to Federal Laws on Identity Theft

Identity theft can be a scary thing. As an attorney, you may have clients come to you looking for help after they’ve become victim to this crime. There are a few key federal laws and legal defenses you should know about to best assist your clients.

The Identity Theft and Assumption Deterrence Act

One of the most important federal laws on identity theft is the Identity Theft and Assumption Deterrence Act (ITADA). This law, passed in 1998, made identity theft a federal crime for the first time. Before this, identity theft was only prosecuted under state laws.

ITADA makes it a crime to:

• Knowingly transfer or use another person’s means of identification (like name, social security number, credit card number, etc.) without legal authority
• Knowingly possess another person’s identification with intent to commit a crime

Violations are punishable by fines and up to 15 years in prison. The law also directs the Federal Trade Commission (FTC) to record consumer complaints about identity theft and provide those records to law enforcement agencies. Read more on the FTC’s role here.

The Fair Credit Reporting Act

The Fair Credit Reporting Act (FCRA) provides important protections for identity theft victims. Under FCRA, consumers have the right to:

• Get a free copy of their credit report after being denied credit or other benefits based on their report
• Dispute inaccurate or incomplete information on their credit report
• Require credit bureaus to investigate disputed items and correct any errors
• Block fraudulent information on their credit report resulting from identity theft

As a lawyer, you can help clients exercise these rights by requesting credit reports, identifying errors/fraud, and sending dispute letters. The FCRA is crucial for clearing up the financial mess left by identity thieves.

The Fair and Accurate Credit Transactions Act

In 2003, the Fair and Accurate Credit Transactions Act (FACTA) amended FCRA to further aid identity theft victims. FACTA entitles consumers to:

• Obtain one free credit report per year from each of the three national credit bureaus
• Place fraud alerts on their credit files
• Block information resulting from identity theft from appearing on their credit reports

As a lawyer, informing clients of these free annual credit reports and fraud alerts can be a big help. FACTA also created the national Do Not Call registry and requires companies to truncate credit card numbers on receipts to better protect consumers.

The Identity Theft Penalty Enhancement Act

The Identity Theft Penalty Enhancement Act increased the penalties for aggravated identity theft. Under this law, anyone who knowingly transfers, possesses, or uses another person’s means of identification during the commission of a serious federal crime faces mandatory 2-year prison sentences. This consecutive sentence would be in addition to any punishment for the underlying crime.

The Identity Theft Enforcement and Restitution Act

The Identity Theft Enforcement and Restitution Act of 2008 authorized the FTC to hire more staff to assist identity theft victims. It also directed the U.S. Sentencing Commission to review its guidelines on identity theft offenses. This has led to stiffer criminal sentences for identity thieves.

Defenses and Legal Strategies

As a lawyer, there are a few defenses and legal strategies you can use on behalf of clients accused of identity theft:

• Consent: Argue the client had permission or authority to use the other person’s identity information. Maybe they were authorized users on a credit card account.
• Lack of intent: Argue the client did not “knowingly” use another person’s identity information. Perhaps it was an accident or case of mistaken identity.
• Statute of limitations: Federal law sets a 5-year statute of limitations for identity theft crimes. If too much time has passed, charges may be dismissed.
• Suppression of evidence: Argue evidence was obtained illegally and should be suppressed. This could weaken the prosecution’s case.
• Character witnesses: Have friends, family, employers testify to client’s good character and reputation. This can create reasonable doubt.
• Negotiate plea bargain: Work to negotiate a favorable plea deal to lesser charges to reduce penalties.

Meeting with prosecutors to share evidence and negotiate is key. As a lawyer, compiling evidence like receipts, alibis, bank records, and character references can also help build a strong defense.

Helping Clients Recover

As a lawyer assisting a victim of identity theft, here are some steps you can guide them through:

1. Request credit reports to identify fraudulent accounts
2. Place fraud alerts and credit freezes with the credit bureaus
3. Dispute fraudulent charges and accounts with banks and creditors
4. File police reports and FTC complaint
5. Complete IRS identity theft affidavit if tax fraud occurred
6. Monitor credit regularly and continue disputing errors
7. Consider credit counseling to help restore credit

You can also refer identity theft victims to resources like IdentityTheft.gov. The most important thing is acting quickly to minimize damage. With your help disputing fraudulent activity, your clients can regain their security.

Identity theft can create major headaches, but federal laws provide important protections. As an attorney familiar with these laws, you have the power to effectively defend clients and assist victims. With a compassionate, knowledgeable approach, you can make the legal process a little less painful for those affected by this crime.

References

Federal Trade Commission, “Identity Theft Red Flags Rule: Addressing the Risk of Corporate Identity Theft”

U.S. Department of Justice, “Identity Theft and Identity Fraud”

Federal Trade Commission, “A Summary of Your Rights Under the Fair Credit Reporting Act”