Vermont last week became only the third state in the nation to enact strong protections for victims of identity theft.

Following the lead of Texas and California, Vermont Gov. James Douglas signed legislation June 8 to require lenders and credit card companies to verify borrowers’ addresses before issuing credit and prohibit the public posting of Social Security numbers, the Bennington Banner reported.

Starting in July 2005, the new law will also allow consumers to place a security freeze on their credit information.

The act of identity theft was Vermont’s most reported consumer complaint in 2003 with 159 complaints filed with the Federal Trade Commission.

Senate Finance Committee Chairman Dick Sears, D-Bennington, told the newspaper that 44 other states have identity theft laws on the books, but until now, only Texas and California have enacted legislation to protect victims from the crime.

On average, individual victims lose between $500 and $1,200, for a total annual loss to consumers of $5 billion, Vermont Attorney General William H. Sorrell said in a statement. Victims typically spend between 30 and 60 hours clearing their names.

Under the new law, anyone found guilty of stealing someone’s identity could face up to three years in prison, a $5,000 fine, or both.

To help prevent identity theft, authorities warn consumers should look out for their own interests by reading their credit card statements, reviewing their credit report once a year, and destroying unwanted credit card offers.

If you think you’ve been a victim of identity theft, you are encouraged to file a police report and a complaint with the state attorney general’s office.