BILL ANALYSIS Ó
AB 1658
Page A
CONCURRENCE IN SENATE AMENDMENTS
AB 1658 (Jones-Sawyer and Chau)
As Amended August 4, 2014
Majority vote
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|ASSEMBLY: |78-0 |(May 28, 2014) |SENATE: |36-0 |(August 13, |
| | | | | |2014) |
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Original Committee Reference: HUM. S.
SUMMARY : Requires county child welfare agencies (CWA) to
undertake specific actions regarding a child's consumer credit
record when he or she is 16 years of age or older and is in
foster care. Specifically, this bill :
1)Requires a county CWA, county probation department, or the
Department of Social Services (DSS) to inquire of each of the
three major credit reporting agencies as to whether a child
described above has any consumer credit history, as specified.
2)Requires DSS to notify the county welfare department or the
county probation department in the county having jurisdiction
over the child of the results of that inquiry.
3)Requires DSS to provide that if an inquiry performed pursuant
to these provisions indicates that a child has a consumer
credit history with any major credit reporting agency, the
responsible county CWA or county probation department is
required to request a consumer credit report from that agency.
4)Requires DSS to provide specified information related to the
implementation of these provisions to the Assembly Budget
Committee, the Senate Budget and Fiscal Review Committee, and
the appropriate legislative policy committees by no later than
February 1, 2016.
5)Makes other technical, nonsubstantive changes to these
provisions.
The Senate amendments delete language in the bill requiring CWAs
to undertake specific actions to assist a minor dependent under
the age of 16 with assessing whether he or she has an active
AB 1658
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consumer credit record and assisting him or her with resolving
any issues with the credit record, including placing a credit
freeze on the credit record. Also delete language requiring DSS
to develop an all-county letter providing guidance on how CWAs
shall implement the freezing and unfreezing of a minor
dependent's credit record.
AS PASSED BY THE ASSEMBLY , this bill required CWAs to undertake
a number of specific actions to assist a minor or nonminor
dependent in identifying whether they have an active consumer
credit record, to assist the minor or nonminor dependent with
resolving any issues identified on his or her credit record, and
to place a freeze on their consumer credit record when they
enter into and emancipate from foster care.
FISCAL EFFECT : According to the Senate Appropriations
Committee, pursuant to Senate Rule 28.8, negligible state costs.
COMMENTS :
Foster youth and identity theft: Identity theft is a growing
crime that is typically not discovered until after the person
whose identity is stolen discovers that fraudulent or criminal
activity has been conducted in using their name and personal and
financial information. Identity theft is more common among
children and even more common among children in foster care. A
2011 study conducted by Carnegie Mellon University found that
children are far more likely to be targeted for identity theft
for their unused social security numbers. Specifically, the
report found that of 42,232 children polled, over 10%, or 4,311
of them, were found to have had their identity stolen. When
compared to the rate of identity theft among adults, children in
this study were 51% more likely to experience identity theft.<1>
Further exacerbating this finding is the fact that parents and
children often do not find out the youth is a victim of identity
theft until he or she applies for a job, opens a financial
account, or is notified by law enforcement that his or her
personal information has been stolen.
---------------------------
<1>
Child Identity Theft: New Evidence Indicates Identity Thieves
are Targeting Children for Unused Social Security Numbers.
Richard Power, Distinguished Fellow; Carnegie Mellon CyLab.
April 2011.
AB 1658
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However, children in foster care who rely upon the state's child
welfare system (CWS) to provide for their health and safety are
at an even greater risk than their peers to become victims of
identity theft. In 2011, the California Office of Privacy
Protection, now known as the Department of Justice's Privacy
Enforcement and Protection Unit, released a report of a
year-long pilot project in Los Angeles County. The pilot
project conducted credit checks on 2,110 foster youth between
the ages of 16 and 17 years of age. It was discovered that 104
children were found to have had 247 financial accounts of
varying types; credit cards, bank accounts, utility accounts,
cellular phone and cable contracts, etc., opened in their name.
Several children were found to have auto loans and one was
identified as having a $217,000 mortgage listed in the child's
name. Fortunately, the project also worked to resolve all 247
accounts and cleared the credit of all 104 children who
participated in the pilot.
Providing foster youth access to their consumer credit reports:
In California, the state has adopted several legislative
measures to help address the risks of identity theft among
children in foster care. In 2006, the state adopted AB 2985
(Maze), Chapter 387, which required CWAs to obtain the consumer
credit report for a youth in foster care when he or she turns 16
years of age. It also required a CWA to provide assistance to a
foster youth if his or her credit report was found to have any
inaccuracies or negative findings. It was later amended by AB
106 (Budget Committee), Chapter 32, Statutes of 2011, the human
services budget trailer bill, which clarified that, beginning
July 1, 2013, CWAs were required to request rather than obtain a
foster youth's credit report when he or she turns 16 years of
age. However, soon after AB 106 was signed into law, it was
preempted by the federal Child and Family Services Improvement
and Innovation (CFSII) Act of 2011. The CFSII Act requires CWAs
to annually request a consumer credit report for a youth 16
years of age and older who is in foster care. Most recently, SB
521 (Liu), Chapter 847, Statutes of 2012, was adopted by the
state to bring California statute into compliance with the CFSII
Act.
In implementation of this requirement, DSS issued All County
Letter (ACL) Number 14-23, which describes the process by which
CWAs may request a foster youth's credit report and how they can
provide assistance in resolving any negative findings in the
report. Specifically, DSS has reached an agreement with the
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three major CRAs, Equifax, Experian, and TransUnion, to create
an electronic batch process for CWAs to access the credit
records of foster youth. However, as of the issuance of the ACL
dated February 28, 2014, five counties have not opted into
accessing foster youth credit records through this process. In
the case of counties that do not receive a batch file, they are
required to comply with separate request procedures imposed by
each of the three major CRAs. In the case of Equifax and
TransUnion, CWAs are required to open an electronic account and
pay a $500 fee. For Experian, CWAs must submit a formal letter
requesting the report, which must include a copy of the court's
dependency order with sensitive information redacted.
Analysis Prepared by : Chris Reefe / HUM. S. / (916) 319-2089
FN: 0004669