Does the FTC Act of 2006 require utility companies to verify an account holder&#39;s identity?
<p>The gas company wanted me to give them my SSN to start service. Naturally, I refused. I was told that they were required <strong>by law</strong> to verify my identity, and offered me the alternative of submitting a notarized form.</p>

<p>I asked which law specifically mandated this identity verification, and I was told that it was the <a href="https://www.ftc.gov/enforcement/statutes/federal-trade-commission-act" rel="nofollow noreferrer">Federal Trade Commission Act of 2006</a>. I have searched through the text of the act, and I can't find anything that references identity verification requirements, or utility companies.</p>

<p>Is this actually a legal requirement, as a consequence of the FTC Act or otherwise?</p>

<p>The first issue is to understand that opening up an account with a utility to provide natural gas services is considered an extension of credit.</p>

<p>This matters because the FTC requires, under the fair credit reporting act and its general power to issue regulations targeted at preventing fraud, that people who open up new credit accounts to verify the identity of the applicant in an effort to prevent identity theft by fake applicants in some cases. Potential creditors must use “reasonable policies and procedures” to verify the identity of an applicant before issuing credit in the consumer's name. This regulatory stance is supported by Fair Credit Reporting Act § 605A(h)(1)(B) a.k.a. 15 U.S.C. § 1681c-1 (h)(1)(B). </p>

<p>The pertinent part of the statute states:</p>

<blockquote>
  <p>(B) Limitation on users (i) In general No prospective user of a
  consumer report that includes an initial fraud alert or an active duty
  alert in accordance with this section may establish a new credit plan
  or extension of credit, other than under an open-end credit plan (as
  defined in section 1602(i) 1 of this title), in the name of the
  consumer, or issue an additional card on an existing credit account
  requested by a consumer, or grant any increase in credit limit on an
  existing credit account requested by a consumer, unless the user
  utilizes reasonable policies and procedures to form a reasonable
  belief that the user knows the identity of the person making the
  request.</p>
  
  <p>(ii) Verification If a consumer requesting the alert has specified a
  telephone number to be used for identity verification purposes, before
  authorizing any new credit plan or extension described in clause (i)
  in the name of such consumer, a user of such consumer report shall
  contact the consumer using that telephone number or take reasonable
  steps to verify the consumer’s identity and confirm that the
  application for a new credit plan is not the result of identity theft.</p>
</blockquote>

<p>The FTC in issuing its regulations and the utility company, as a matter of policy and expediency, have decided that it the utility company must do credit checks on all prospective customers and will speed up the application process for people who have "fraud alerts" or "active duty alerts" on their credit reports by requiring verification from everyone instead of finding out that they can't get a credit report for a particular customer without verification and then having to go back to the customer to get it.</p>

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