E7-5818. Agency Information Collection Activities; Submission for OMB Review; Comment Request

AGENCY:

Federal Trade Commission.

ACTION:

Notice.

SUMMARY:

The information collection requirements described below will be submitted to the Office of Management and Budget (“OMB”) for review, as required by the Paperwork Reduction Act (“PRA”). The Federal Trade Commission (“FTC” or “Commission”) is seeking public comments on its proposal to extend through June 30, 2010 the current OMB clearance for information collection requirements contained in its Identity Theft Report Definition Rule (“Rule”). That clearance expires on June 30, 2007.

DATES:

Comments must be filed by May 29, 2007.

ADDRESSES:

Interested parties are invited to submit written comments. Comments should refer to “IDT Report Rule: FTC Matter No. R411002,” to facilitate the organization of comments. A comment filed in paper form should include this reference both in the text and on the envelope and should be mailed or delivered, with two complete copies, to the following address: Federal Trade Commission, Room H-135 (Annex J), 600 Pennsylvania Ave., NW., Washington, DC 20580. Because paper mail in the Washington area and at the Commission is subject to delay, please consider submitting your comments in electronic form, as prescribed below. However, if the comment contains any material for which confidential treatment is requested, it must be filed in paper form, and the first page of the document must be clearly labeled “Confidential.” ^[1]

Comments filed in electronic form should be submitted by following the instructions on the Web-based form at https://secure.commentworks.com/​IDTReportRule. To ensure that the Commission considers an electronic comment, you must file it on the Web-based form at the https://secure.commentworks.com/​IDTReportRule weblink. If this notice appears at www.regulations.gov, you may also file an electronic comment through that Web site. The Commission will consider all comments that regulations.gov forwards to it.

The FTC Act and other laws the Commission administers permit the collection of public comments to consider and use in this proceeding as appropriate. All timely and responsive public comments will be considered by the Commission and will be available to the public on the FTC Web site, to the extent practicable, at www.ftc.gov. As a matter of discretion, the FTC makes every effort to remove home contact information for individuals from the public comments it receives before placing those comments on the FTC Web site. More information, including routine uses permitted by the Privacy Act, may be found in the FTC's privacy policy at http://www.ftc.gov/​ftc/​privacy.htm.

FOR FURTHER INFORMATION CONTACT:

Requests for additional information should be addressed to Kristin Krause Cohen, Attorney, Division of Privacy and Identity Protection, Bureau of Consumer Protection, Federal Trade Commission, 600 Pennsylvania Avenue, NW., Washington, DC 20580, [phone].

SUPPLEMENTARY INFORMATION:

Under the Paperwork Reduction Act (“PRA”), 44 U.S.C. 3501-3520, federal agencies must obtain approval from OMB for each collection of information they conduct or sponsor. “Collection of information” means agency requests or requirements that members of the public submit reports, keep records, or provide information to a third party. 44 U.S.C. 3502(3); 5 CFR 1320.3(c). As required by section 3506(c)(2)(A) of the PRA, the FTC is providing this opportunity for public comment before requesting that OMB extend the existing paperwork clearance for the regulations noted herein.

The FTC invites comments on: (1) Whether the required collection of information is necessary for the proper performance of the functions of the agency, including whether the information has practical utility; (2) the accuracy of the agency's estimate of the burden of the required collection of information, including the validity of the methodology and assumptions used; (3) ways to enhance the quality, utility, and clarity of the information to be collected; and (4) ways to minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.

All comments should be filed as prescribed in the ADDRESSES section above, and must be received on or before May 29, 2007.

The Identity Theft Report Definition Rule, 16 CFR Part 603, was promulgated pursuant to the Fair and Accurate Credit Transactions Act of 2003 (“FACT Act” or the “Act”), amending the Fair Credit Reporting Act, which established requirements for consumer reporting agencies, creditors, and others to help remedy problems associated with identity theft. Under the Act, an individual can mitigate a number of specific harms resulting from identity theft by providing an identity theft report to consumer reporting agencies and information furnishers. For example, with an identity theft report, an identity theft victim can obtain a seven year fraud alert or seek to block fraudulent information on their credit report. Pursuant to the FACT Act, the Rule defined the term “identity theft report,” 16 CFR 603.5, and became effective on December 1, 2004.

Burden statement: Commission staff estimates of paperwork burden for the Act and Rule are based on its knowledge of identity theft trends and an identity theft study report, Federal Trade Commission—Identity Theft Survey Report (Survey Report), prepared for the Commission by Synovate, and issued in September 2003.^[2] Staff estimates that the average annual paperwork burden for the three-year clearance period sought is 586,000 hours with associated annual labor cost burden of $10.911 million.

To derive the estimated total annual hours burden and the estimated labor cost burden, staff first determined the increase in the number of individuals who obtain identity theft reports as a result of the Identity Theft Report Definition Rule. In its 2004 notice of proposed rulemaking ^[3] and corresponding submission to OMB, FTC staff estimated that the then-proposed rule would increase by 1.529 million the number of individuals obtaining identity theft reports annually. No provisions in the Rule have been amended since staff's prior submission to OMB. Accordingly, absent additional public information to the contrary, staff will continue to apply that estimate, which is explained below.

The Survey Report indicates that there are 9.91 million individuals victimized by identity theft each year.^[4] Twenty-six percent of those individuals, or 2.577 million, contact a local law enforcement agency.^[5] Seventy-six percent of the 2.577 million, or 1.958 million, file a police report alleging identity theft.^[6] Staff anticipates that, as both individuals and police departments become increasingly aware of the benefits of obtaining an “identity theft report” under the Act, the number of individuals who ultimately obtain an identity theft report will likely increase because the Rule facilitates a victim's ability to file a law enforcement report.

The Survey Report indicated that 618,000 victims who contact local law enforcement annually are unable to file a police report.^[7] Thus, staff estimates that the Rule will enable those victims who previously were unable to file reports with local law enforcement to now file reports with a state or federal law enforcement agency. Second, 4.261 million victims annually contact an information furnisher.^[8] Staff estimates, based on its knowledge of identity theft trends, that the Rule will result in an increase of 10%, or 426,000, of these victims obtaining an identity theft report. Third, 646,000 victims do not take any action even though their information was used to open new accounts or to commit other frauds.^[9] Staff estimates, based on its knowledge of identity theft trends, that the Rule will likely result in 75%, or 485,000, of these victims obtaining identity theft reports. In sum, staff estimates that the Rule will increase by 1.529 million the number of individuals obtaining identity theft reports (618,000 + 426,000 + 485,000).

Estimated total annual hours burden: 586,000 hours (rounded to the nearest thousand).

In its 2004 notice of proposed rulemaking and corresponding submission to OMB, FTC staff estimated, based on the experience of the Commission's Consumer Response Center, that an individual would spend an average of 5 minutes finding and reviewing filing instructions, 8 minutes filing the law enforcement report with the law enforcement agency, and 5 minutes submitting the law enforcement report and any additional information or documentation to the information furnisher or consumer reporting agency, resulting in an average of 18 minutes for each identity theft report.

Staff now estimates, based on the ongoing experience of the Commission's Consumer Response Center, that an individual will spend 5 minutes finding and reviewing filing instructions, 13 minutes filing the law enforcement report with the law enforcement agency (due to added entry fields), and 5 minutes submitting the law enforcement report and any additional information or documentation to the information furnisher or consumer reporting agency, resulting in an average of 23 minutes for each identity theft report. Thus, the annual information collection burden for the estimated 1.529 million new identity theft reports due to the Rule will be 586,000 hours. [(1.529 million × 23 minutes)/60 minutes]

Estimated labor costs: $10,911,000 (rounded to the nearest thousand).

Commission staff derived labor costs by applying appropriate hourly cost figures to the burden hours described above. According to the Bureau of Labor Statistics survey from June 2005, the average national wage for individuals was $18.62.^[10] Applying this average national wage to the 586,000 burden hours results in an estimated $10.911 million labor cost burden on individuals who obtain identity theft reports ($18.62 × 586,000 hours).

Estimated annual non-labor cost burden: $0 or minimal.

Staff believes that the Rule's paperwork burden imposes negligible capital or other non-labor costs, as an identity theft victim is likely to have the necessary supplies and/or equipment already (telephone, computer, paper, envelopes) for purposes of obtaining the identity theft report and submitting it to information furnishers or consumer reporting agencies.

William Blumenthal,

General Counsel.

Footnotes

1.  Commission Rule 4.2(d), 16 CFR 4.2(d). The comment must also be accompanied by an explicit request for confidential treatment, including the factual and legal basis for the request, and must identify the specific portions of the comment to be withheld from the public record. The request will be granted or denied by the Commission's General Counsel, consistent with applicable law and the public interest. See Commission Rule 4.9(c), 16 CFR 4.9(c).

2.  See Synovate survey at http://www.ftc.gov/​os/​2003/​09/​synovatereport.pdf.

3.  69 FR 23370 (Apr. 28, 2004), at 23375.

4.  Survey Report at 7.

5.  Id. at 59. All calculations in this section have been rounded to the nearest thousand.

6.  Id.

7.  Id. (24% of the 2.577 million victims who contacted law enforcement did not obtain a copy of a police report).

8.  Id. at 50 (43% of all 9.91 million victims contact an information provider).

9.  Based upon staff's analysis of data collected in the survey, these types of victims constitute 20% of the 3.23 million victims each year whose information is used to open new accounts or commit other frauds.

10.  The hourly rates are based on average annual Bureau of Labor Statistics National Compensation Survey data, June 2005 (with 2005 as the most recent whole year information available, and June the focal median point). http://www.bls.gov/​ncs/​ocs/​sp/​ncbl0832.pdf (see Table 1.1).