After the Equifax data breach that exposed the personal information of around 143 million consumers, Democrats have introduced a bill to give consumers the ability to freeze their credit for free.
According to news from Reuters, U.S. Senator Elizabeth Warren also announced that she has begun an investigation into the hack, explaining in a letter to the Consumer Financial Protection Bureau (CFPB), the agency she helped create after the 2007-2009 financial crisis, that it may require additional powers to ensure closer federal oversight of credit reporting agencies.
“Is there a silver lining to this breach? Could this protect the CFPB for a while? Possibly,” said Karl Frisch, executive director of consumer advocacy group Allied Progress. The CFPB has been under attack in recent months by Republicans, who believe the agency is too powerful.
Elizabeth Warren also wrote letters to Equifax and its competitors TransUnion and Experian, federal regulators and the Government Accountability Office for information to see if new federal legislation was needed to protect consumers.
“I am troubled by this attack — described as ‘one of the largest risks to personally sensitive information in recent years’ — and by the fact that it represents the third recent instance of a data breach of Equifax or its subsidiaries that has endangered Americans’ personal information,” she wrote in a letter to Equifax Chairman and Chief Executive Richard Smith.
The proposed bill — introduced by Warren and 11 other Democrats — would stop companies like Equifax from charging consumers for freezing and unfreezing access to their credit files. A credit freeze restricts access to an individual’s credit report, stopping thieves from applying for credit using another person’s information.
Warren also questioned the overall regulatory framework for credit reporting agencies like Experian, which are not subject to the same levels of intense scrutiny as other consumer finance firms. While the CFPB supervises credit reporting firms’ compliance with consumer protection laws — and even fined Equifax and TransUnion earlier this year for $5.5 million in total for misstating the cost and usefulness of the scores they provide — it does not directly license or intensively monitor the companies.
In response to the leak, investors dumped Equifax’s stock, driving it down 36 percent since the company disclosed the hack on Sept. 7. The company’s shares fell below $93 early on Friday and were trading near $91 late Friday morning.