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Laws Take Aim at 21st Century Crime

Legislation: Information Age rip-offs, including 'identity theft,' bring statutes designed to protect consumers.


The new batch of California laws that took effect this month includes consumer measures that read like a blueprint of Information Age pitfalls, from the telephone to the Internet.

"Consumer protection historically was designed to make products more safe and reliable," says Marjorie Berte, director of the state Department of Consumer Affairs. "Now the emphasis is shifting from the product itself to the financial transaction surrounding the product."

Nearly 1,000 new laws were passed during the last legislative session, covering everything from education to witness protection. Among them are consumer measures dealing with such growing areas of concern as telemarketing scams, "identity theft" and electronic invasion of privacy, issues that one legislator described as the "crimes of the 21st century."

Berte says these and related issues are starting to overshadow such traditional consumer concerns as safe toys and appliance warranties.

Not only is technology changing, but so is the population. "We see a growing senior population vulnerable to telemarketing scams," Berte says. Homebound, often lonely, seniors can be vulnerable to a friendly voice. Berte's office advises consumers of any age, when buying over the telephone, to make sure they know who is calling. All telemarketers are required by law to identify themselves and their companies before starting a sales pitch.

Many of the laws provide only incremental changes that advance existing measures--clarifying, for instance, that gift certificates sold without expiration dates are "valid until redeemed or replaced."

But some statutes break new ground, says Ray Saatjian, the Consumer Affairs Department's deputy director. One is a first-time law dealing with identity theft (using someone else's personal information to obtain credit or credit cards for a spending spree), one of the fastest-growing consumer frauds.

The new law makes it a crime to obtain or use personal identifying information without permission, and to obtain credit with the unauthorized information. The measure makes it more difficult for impostors to get instant credit at retail stores, and easier for victims to repair the damage.

California, which leads the nation in identity thefts, is the first state to enact a protective law. Although critics contend it should be tougher, the new law is a good start, says Saatjian, who predicts more legislative fine-tuning on the issue.

Another law reflecting changes in the marketplace requires that all point-of-sale devices--such as those at supermarket checkouts and gasoline pumps--disclose the fee charged for the transaction. This expands an existing law that applied only to ATM operators, and it affects millions of transactions a day, Saatjian says. "Banks are increasingly charging fees to use credit or debit cards and the shopper needs to be informed."

A similar disclosure law requires hotels and motels to post information on telephone charges. "This gives the consumer an informed choice in hotels that charge outrageous fees for use of an in-room phone," Saatjian says.

He also cites two new consumer-friendly Internet laws. One requires many state agencies, including those regulating automotive, electronic and appliance repair, to post the status of each license issued, including information on any suspensions or revocations. "This allows consumers to determine in advance if any disciplinary action has been taken against the service provider," says Saatjian.

The second Internet law, the Citizens Complaint Act of 1997, requires any state agency with a Web site to include a form for consumer complaints or comments on the agency's performance.

"This is the positive side of the Information Age," says Berte.

"Our own Web site ( is getting 15,000 hits a day," says Berte. California residents are signing on to find help for everything from smog-check information to a list of the Top 10 scams. "We can't protect everybody from every transaction," Berte says, "but if people know what questions to ask, they will be less vulnerable."

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