California Identity Theft Law Allows for the Recovery of a Civil Penalty Up to $ 30,000.00 From Claimants For Identity Theft Victims Who Meet Certain Criteria

Many victims of identity theft face debt collection attempts by banks, creditors and debt collectors. It is not uncommon for these lenders to continue to pursue victims of identity theft for debt balances incurred by the identity thief, even after being notified that the debts were incurred by the identity thief! These lenders will often continue to send collection notices to the identity theft victim, credit report the debt on the identity theft victim’s credit report, or even sue the identity theft victim for the debt incurred by the identity thief.

At Martin & Bontrager, APC, we help identity theft victims and protect them from lenders who attempt to collect debt from identity theft victims. California allows a victim of “identity theft” to bring an action (or file a cross-complaint) against a “claimant” who is attempting to collect a debt from the victim of identity theft to establish that the person is a victim of identity theft in connection with the claimant’s claim against that person. An identity theft victim who proves, by a preponderance of the evidence, that he or she is a victim of identity theft as to a particular claim, is entitled to a judgment for all of the following, as appropriate:

  1. A declaration that he or she is not obligated to the claimant on that claim.
  2. A declaration that any security interest or other interest the claimant had purportedly obtained in the victim’s property in connection with that claim is void and unenforceable.
  3. An injunction restraining the claimant from collecting or attempting to collect from the victim on that claim, from enforcing or attempting to enforce any security interest or other interest in the victim’s property in connection with that claim, or from enforcing or executing on any judgment against the victim on that claim.
  4. If the victim has filed a cross-complaint against the claimant, the dismissal of any cause of action in the complaint filed by the claimant based on a claim which arose as a result of the identity theft.
  5. Actual damages, attorney’s fees, and costs, and any equitable relief that the court deems appropriate. In order to recover actual damages or attorney’s fees in an action or cross-complaint filed by a person alleging that he or she is a victim of identity theft, the person shall show that he or she provided written notice to the claimant that a situation of identity theft might exist, including, upon written request of the claimant, a valid copy of the police report or the Department of Motor Vehicles investigative report promptly filed pursuant to Section 530.5 of the Penal Code* at least 30 days prior to his or her filing of the action, or within his or her cross-complaint pursuant to this section.
  6. A civil penalty, in addition to any other damages, of up to thirty thousand dollars ($30,000) if the victim establishes by clear and convincing evidence all of the following:
    1. That at least 30 days prior to filing an action or within the cross-complaint pursuant to this section, he or she provided written notice to the claimant at the address designated by the claimant for complaints related to credit reporting issues that a situation of identity theft might exist and explaining the basis for that belief.
    2. That the claimant failed to diligently investigate the victim’s notification of a possible identity theft.
    3. That the claimant continued to pursue its claim against the victim after the claimant was presented with facts that were later held to entitle the victim to a judgment pursuant to this section.

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