Florida just joined almost half the other states in allowing residents to request a credit freeze. But the new law may not last long if Congress has anything to say about it -- they're trying to pass a law that would severely limit your ability to get a credit freeze.

What's up with these credit freezes, and why are the feds trying to overrule the states? As you might guess, it has to do with money, specifically who contributes to the campaigns of those in Congress and therefore has laws written on their behalf.

Here's the deal: A credit freeze gives you the ability to "freeze" your credit history, meaning no one can look at it without your permission. Your chances of having your identity stolen for fraudulent purposes goes way down, because no one could use your information to open new credit accounts. In addition, the constant solicitation from financial companies, credit card issuers, etc. goes way down, because they can't see your credit info and thus can't send you letters saying you're pre-approved for hundreds of thousands of dollars of free money (that'll cost you later).

On the downside, when you DO want to open a new credit line, be approved for a mortgage, etc., you'd have to "unfreeze" your credit to give these companies access to it, which is the hassle you agree to when you decide to do a credit freeze in the first place.

Seems like a good thing for consumers, right? Maybe that's why more and more states are doing it. So why does Congress want to make a national law that throws the state laws out and restrict credit freezes only to those who've already been identity theft victims and can specifically prove that the loss of their information was used to commit a crime? Isn't that like closing the barn door after the horses got out? Providing police protection after the stalker has already killed his ex-girlfriend?

Who could possibly convince Congress that the law should restrict your control of your very own credit information?

Have you guessed? Yes, yes--the credit industry. They don't want you freezing your credit, making its harder to gain acces to your information so they can send you pre-approved offers for credit cards, home equity loans, refinance loans, etc., etc, etc. This would hurt their profits.

Now this is a rhetorical question, but I'll ask it anyway: Whose side do you think Congress is on?

From the USA Today article:

Rep. Steven LaTourette, R.-Ohio, the bill's co-author, says credit freezes must be held in check to keep the financial system from unraveling. "Even the simplest process of buying groceries with your credit or debit card will break down if we allow a patchwork of competing and conflicting state laws," he says.

The Congressman, who unfortunately comes from my neck of the woods, is talking smack. Credit freezes do not stop your credit cards from working, or your mortgage loan from being collected. They only, by your request, stop new credit from being issued in your name, or stop credit checks from being done on you without your permission.

It's shameful, really, to describe a bill that restricts consumers' power over their own information as being for the consumers' protection. But it's not surprising.