CHAPTER 523. PROVISIONS RELATING TO VICTIMS OF IDENTITY THEFT
BUSINESS AND COMMERCE CODE
TITLE 11. PERSONAL IDENTITY INFORMATION
SUBTITLE B. IDENTITY THEFT
CHAPTER 523. PROVISIONS RELATING TO VICTIMS OF IDENTITY THEFT
SUBCHAPTER A. EXTENSIONS OF CREDIT AND VERIFICATION
OF IDENTITY
Sec. 523.001. EXTENSION OF CREDIT TO VICTIM OF IDENTITY THEFT.
(a) In this section, "victim of identity theft" means an
individual who has filed a criminal complaint alleging the
commission of an offense under Section 32.51, Penal Code, other
than a person who is convicted of an offense under Section 37.08,
Penal Code, with respect to that complaint.
(b) A person who has been notified that an individual has been
the victim of identity theft may not deny the individual an
extension of credit, including a loan, in the individual's name
or restrict or limit the credit extended solely because the
individual has been a victim of identity theft. This subsection
does not prohibit a person from denying an individual an
extension of credit for a reason other than the individual's
having been a victim of identity theft, including by reason of
the individual's lack of capacity to contract.
(c) A license issued under Subtitle B, Title 4, Finance Code,
that is held by a person who violates this section is subject to
revocation or suspension under that subtitle.
Added by Acts 2007, 80th Leg., R.S., Ch.
885, Sec. 2.01, eff. April 1, 2009.
Sec. 523.002. VERIFICATION OF CONSUMER IDENTITY. (a) In this
section:
(1) "Consumer report" has the meaning assigned by Section 20.01.
(2) "Extension of credit" does not include:
(A) an increase in the dollar limit of an existing open-end
credit plan as defined by federal Regulation Z (12 C.F.R. Section
226.2), as amended; or
(B) any change to, or review of, an existing credit account.
(3) "Security alert" has the meaning assigned by Section 20.01.
(b) A person who receives notification of a security alert under
Section 20.032 in connection with a request for a consumer report
for the approval of a credit-based application, including an
application for an extension of credit, a purchase, lease, or
rental agreement for goods, or for an application for a
noncredit-related service, may not lend money, extend credit, or
authorize an application without taking reasonable steps to
verify the consumer's identity.
(c) If a consumer has included with a security alert a specified
telephone number to be used for identity verification purposes, a
person who receives that number with a security alert must take
reasonable steps to contact the consumer using that number before
lending money, extending credit, or completing any purchase,
lease, or rental of goods, or approving any noncredit-related
services.
(d) If a person uses a consumer report to facilitate the
extension of credit or for any other transaction on behalf of a
subsidiary, affiliate, agent, assignee, or prospective assignee,
that person, rather than the subsidiary, affiliate, agent,
assignee, or prospective assignee, may verify the consumer's
identity.
Added by Acts 2007, 80th Leg., R.S., Ch.
885, Sec. 2.01, eff. April 1, 2009.
SUBCHAPTER B. DUTIES OF FINANCIAL INSTITUTIONS AND
OF VERIFICATION ENTITIES
Sec. 523.051. NOTATION OF FORGED CHECK. (a) In this section,
"victim of identity theft" means a person who has filed with an
appropriate law enforcement agency a criminal complaint alleging
commission of an offense under Section 32.51, Penal Code.
(b) A financial institution, in accordance with its customary
procedures, shall process as forgeries checks received on the
account of a victim of identity theft if the victim:
(1) closes the account at the financial institution as a result
of the identity theft;
(2) notifies the financial institution that the identity theft
is the reason for closing the account;
(3) provides the financial institution with a copy of the
criminal complaint described by Subsection (a); and
(4) requests that the financial institution return checks with
the notation "forgery."
(c) A victim of identity theft who requests that a financial
institution return checks with the notation "forgery" as provided
by Subsection (b):
(1) may not assert that the financial institution is liable
under Section 4.402 for wrongfully dishonoring a check returned
after the victim makes the request; and
(2) shall hold the financial institution harmless for acting in
accordance with the victim's request.
Added by Acts 2007, 80th Leg., R.S., Ch.
885, Sec. 2.01, eff. April 1, 2009.
Redesignated from Business and Commerce Code, Section 523.003 by
Acts 2009, 81st Leg., R.S., Ch.
87, Sec. 4.011(b), eff. September 1, 2009.
Sec. 523.052. NOTIFICATION TO CHECK VERIFICATION ENTITIES THAT
CUSTOMER IS VICTIM OF IDENTITY THEFT. (a) In this section:
(1) "Check verification entity" means a consumer reporting
agency that compiles and maintains, for businesses in this state,
files on consumers on a nationwide basis regarding the consumers'
check-writing history.
(2) "Financial institution" means a bank, savings association,
savings bank, or credit union maintaining an office, branch, or
agency office in this state.
(b) A financial institution shall submit the information as
required by Subsection (c) if a customer notifies the financial
institution that the customer was a victim of an offense under
Section 32.51, Penal Code, requests that the financial
institution close an account that has been compromised by the
alleged offense, and presents to the financial institution:
(1) a copy of a police report of an offense under Section 32.51,
Penal Code;
(2) a sworn statement by the person that the person was the
victim of an offense under that section; and
(3) written authorization to submit the information required by
Subsection (d) to the electronic notification system established
under Section 11.309, Finance Code, for secure distribution to
check verification entities.
(c) A financial institution that receives the documents required
by Subsection (b), not later than the second business day after
the date the customer provides the documents to the financial
institution, shall submit the information required by Subsection
(d) to the electronic notification system established under
Section 11.309, Finance Code.
(d) The information submitted by a financial institution under
Subsection (c) must include:
(1) the customer's name, address, phone number, date of birth,
and driver's license number or government-issued identification
number;
(2) the financial institution account number of any account that
has been compromised by the alleged offense and has been closed
in response to the alleged offense;
(3) the financial institution routing number; and
(4) the number on any check that has been lost, stolen, or
compromised.
(e) A check verification entity shall maintain reasonable
procedures, in accordance with rules adopted by the finance
commission, to prevent the check verification entity from
recommending acceptance or approval of a check or similar sight
order drawn on an account identified in the notification if:
(1) the check verification entity receives notification through
the electronic notification system; or
(2) a customer presents to the check verification entity:
(A) a copy of a police report of an offense under Section 32.51,
Penal Code;
(B) a sworn statement by the person that the person was the
victim of an offense under that section and that the person has
requested that the financial institution close any account that
has been compromised by the alleged offense; and
(C) the information described by Subsection (d).
(f) A financial institution or check verification entity, or an
officer, director, employee, or agent of the institution or
entity, is not liable for damages resulting from providing the
notification required by Subsection (c) or failing to recommend
acceptance or approval of a check or similar sight order under
Subsection (e).
(g) The Finance Commission of Texas may adopt rules:
(1) to implement this section;
(2) to clarify the duties and responsibilities of a customer,
financial institution, or check verification entity under this
section; and
(3) to specify how an erroneous notification may be withdrawn,
amended, or corrected.
Added by Acts 2007, 80th Leg., R.S., Ch.
1044, Sec. 1, eff. September 1, 2007.
Transferred from Business and Commerce Code, Section 35.595 by
Acts 2009, 81st Leg., R.S., Ch.
87, Sec. 4.011(c), eff. September 2, 2009.