More Credit Info Could Be Coming Your Way

For example, credit card companies sometimes charge higher interest rates if the card holder has a history of delinquent payments with other entities.

One of the main proposals to the Fair Credit Reporting Act, or FCRA, would allow consumers a free copy of their credit reports once a year. Currently, consumers have the right to receive free reports only if they have been denied credit or employment based on information contained in the credit report, or have been the victims of fraud.

The Bush administration is hoping greater access to credit reports will help consumers spot irregularities in their records.

"We believe that this proposal will not only help stop identity theft, but that it will lead to improvement in the overall quality of the information in the credit reporting system," Snow said in recent testimony before Congress.

Other proposals include a national alert system that would allow consumers who have been victimized or who are in danger of being victimized to put banks and merchants on notice against any further efforts to impersonate them. The new regulations would also put bank regulators on watch for patterns followed by identity thieves, so they could more easily spot red flags that may indicate fraudulent activity.

Another proposal would also allow the Federal Trade Commission authority to notify consumers when their credit scores caused them to be offered less favorable rates than those for which they've applied.

First Steps in a Long Battle

Many consumer group representatives say the government's proposals are good first steps in combating identity theft and improving consumers' knowledge of their credit status. But some say the rules wouldn't go far enough.

One big criticism is a provision that would restrict states from adopting their own regulations to deal with identity theft and credit fraud. Consumer advocates say state laws are more consumer-friendly, and state officials are quicker to respond to complaints than the federal government. Six states — Colorado, Georgia, Maryland, Massachusetts, New Jersey and Vermont — already allow their residents free access to their credit reports.