Identity Theft: Differences in Consequence and Regulation Across State, Federal, and International Law

 According to Federal Records Management & Shredding, the Gramm-Leach-Bliley Act requires financial institutions to tell customers how they’ll use their data, whereas, the Fair and Accurate Credit Transitions Act (2024) requires the three nationwide credit rating agencies (Equifax, Experian, and TransUnion) to provide consumers with a free credit report once annually upon request to decrease identity theft in the United States. 


The Gramm-Leach-Bliley Act was revolutionary because it required an opt-out notice to be added to privacy notices regarding nonaffiliated third parties in hopes of ensuring consumer financial privacy. In many instances, the Fair and Accurate Credit Transactions Act focuses on the accuracy and privacy of credit information. According to Federal Trade Commission, there are times when they overlap and privacy rules in the Fair and Accurate Credit Transactions Act require a more stringent approach to the Gramm-Leach-Bliley Act, providing an opt-out notice even for third-party affiliates (2002). To comply with GLBA and FACTA, corporations must implement robust data protection measures, determine their opt-out mechanisms are accessible and functional, and regularly review their privacy notices to prevent unauthorized sharing of consumer financial information. This can be extremely difficult to comply with if you are in the middle of a transaction.


Patituce & Associates Attorneys at Law identifies a substantial difference in identity theft crimes at the state level versus the federal level. The firm states that state identity theft cases can receive a penalty of up to 15 years, whereas a federal case can easily extend a sentence by thirty years. Federal crimes usually involve larger operations that cross state lines or involve drugs or terrorism. At the state level, identity theft usually involves using someone else’s credit card or personal information to use on the internet. At the international level, the Florida Journal of International Law states, “The international community has become aware of the need for

cooperation regarding identity theft laws, but has yet to achieve any sort of uniformity” (2024). It suggests that identity theft is harder to prosecute internationally due to different authorities across countries, different definitions for what identity theft is, and different ideas of what the consequences should be. The impact of identity theft reaches beyond legal repercussions; it can damage credit ratings, lead to severe personal financial loss, and cause long-lasting emotional distress. If a hacker commits a crime in one country but resides in another country, it is often difficult to prosecute due to a lack of authority in the region where the hacker lives. To successfully prosecute them under their authority, they would have to enter the country where they committed the crime. It’s difficult to convince a country to devote its resources to prosecuting another country’s problem. While I mentioned typical penalties for state and federal identity theft crimes, the consequences vary from only a few years to many decades based on the specific situation. States vary on how they address identity crimes, and even within states sentences are not uniform across judges and jurisdictions. 


References:


Federal Records Management & Shredding. (2024). The HIPAA, FACTA, and GLBA: What Are They and How Do They Affect You?. https://federal-recordsmanagement.com/resources/2018/05/hipaa-facta-glba-affect/


Federal Trade Commission. (2002). How To Comply with the Privacy of Consumer Financial Information Rule of the Gramm-Leach-Bliley Act. https://www.ftc.gov/business-guidance/resources/how-comply-privacy-consumer-financial-information-rule-gramm-leach-bliley-act


Matthews, C. (2013). International Identity Theft: How the Internet Revolutionized Identity Theft and the Approaches the World's Nations are Taking to Combat It. Florida Journal of International Law. 25(2), Article 4. https://scholarship.law.ufl.edu/cgi/viewcontent.cgi?article=1571&context=fjil


Patituce, J. (2024). Is Identity Theft a Federal Crime?. Patituce & Associates Attorneys at Law. https://patitucelaw.com/2024/02/is-identity-theft-a-federal-crime/#:~:text=Identity%20theft%2C%20the%20act%20of,crime%20in%20the%20United%20States.


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