by Jeff Sovern
When we talked in class this semester about how many credit card issuers send out "pre-screened" credit card applications, I mentioned how identity thieves famously "dumpster dive" for them after the consumer has thrown them away, fill them out, and send them in, using the identity thief's address. I pointed out that the Fair Credit Reporting Act requires the credit card issuers to allow consumers to opt out of the applications (15 U.S.C. § 1681b(e)), thus reducing the likelihood that an identity thief will steal their identity, but that some people simply tear the applications up, preventing the thieves from using them. Not so fast, my students replied. They pointed me to this story about how a consumer tore an application up, then taped it back together, and sent it in using a different address. Chase sent him the credit card anyway. Bob Sullivan has more.
So the opt-out seems like the better choice. Another problem that can be solved with a rule. The problem is that, as I've noted before, few consumers take advantage of opt-outs. While I'm not aware of any publicly-available statistics about how many have opted out of pre-screened solicitations (something the CFPB may want to look into), I doubt many have. If I'm right about that, I hope the CFPB or Congress can come up with a more effective way to protect consumers from the continuing identity theft epidemic than opt-outs few use.