Preventing Identity Theft

Now identity theft has been around for way too long and Congress still doesn't seem to know what to do about it so, as a moderate democrat, I'd like to propose a solution by answering the latest conservative republican war cry:  "What is your plan?"

On January 22, 2007 Bruce Schneier wrote an OP-ED forbes.com making a compelling argument in a conservative (it is FORBES) publication. In my abridgement of his article, he notes that in identity theft:
"the credit-rating damage is borne by the victim. It can take years for the victim to completely clear his name.

Such crime involves two very separate issues. The first is the privacy of personal data.  The second issue is the ease with which a criminal can use personal data to commit fraud.

Proposed fixes tend to concentrate on the first issue--making personal data harder to steal--whereas the real problem is the second.

Fraudulent transactions have nothing to do with the legitimate account holders. Criminals impersonate legitimate users to financial institutions. That means that any solution can't involve the account holders.
That leaves only one reasonable answer: financial institutions need to be liable for the cost of fraudulent transactions. They need to be liable for sending erroneous information to credit bureaus based on fraudulent transactions.
We need to concentrate on detecting and preventing fraudulent transactions. We need to make the entity, which is in the best position to mitigate the risk, responsible for that risk. And that means making the financial institutions liable for fraudulent transactions.
Doing anything less simply won't work."
Now here is my plan.  I have cobbled together the following draft statute which, if Bruce Schneier is right and I think he is, will save the millions now being spent on trying to protect social security numbers while simultaneously preventing identity theft:

TITLE ?? United States Code

Every person, domestic or foreign, who is in any way engaged in interstate commerce with or within the several United States, who subjects, or causes to be subjected, any citizen of the United States or other person within the jurisdiction thereof to the appropriation of his or her name or likeness by another, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress.

For the purposes of this section, it will be sufficient for a plaintiff to prove

(1) defendant aided a person other than plaintiff to appropriate plaintiff's identity and enter into legal, financial and other transactions which were unknown to plaintiff and placed plaintiff in a false light before the public,
(2) the false light in which plaintiff was placed would be highly offensive to a reasonable person, and
(3) defendant failed to make reasonable efforts to verify the accuracy and truthfulness of the information submitted by the person wrongfully appropriating plaintiff's identity.

In any action or proceeding to enforce this act, a successful plaintiff will be made whole by mandatory correction of all records maintained by the defendant(s) and award of

(1) actual damages for all losses incurred by the plaintiff as a result of the misappropriation of his or her identity to include the award of court costs and reasonable attorney's fees,
(2) reasonable damages for the mental distress of the plaintiff resulting from misappropriation of his or her identity, and
(3) treble damages if plaintiff proved that defendant(s) acted in reckless disregard of the falsity and the false light in which plaintiff's identity would be placed or unreasonably delayed effective actions to restore plaintiff's public identity.

We need a LAW to protect the victims of identity theft, not studies and committee meetings and TV talking head "experts."  I have suggested one.  This is my first post and I'm not sure if I've done it right or if RK is the place for it.

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