I had dinner with a few CSO friends of mine the other night and heard a lot of grumbling about the "Red Flag Rules". "Red Flag Rules" are provisions covered under Sections 114 and 315 of FACTA (the Fair and Accurate Credit Transactions Act of 2003) that require financial institutions to implement an identity theft prevention program to help stave off identity theft.
Specifically, FACTA amended the Fair Credit Reporting Act to require the federal banking agencies and the National Credit Union Administration jointly:
- establish and maintain guidelines for use by each financial institution and each creditor regarding identity theft;
- prescribe regulations requiring each financial institution and each creditor to establish reasonable policies and procedures for implementing these guidelines in order to identify possible risks to account holders or customers or to the safety and soundness of the institution or customers; and,
- prescribe regulations applicable to card issuers to ensure that will flag typical indicators of fraud
- notify consumers about significant address discrepancies on their credit reports which may indicate fraud
These rules went into effect this past January 1st and require full compliance by November 1, 2008. Interestingly enough, they don't seem to have gotten much attention so it begs the question, "are financial institutions going to meet the deadline?" If you are a financial institution as determined by the Equal Credit Opportunity Act (anyone who arranges for the extension, renewal, or continuation of credit, including third-party debt collectors) you have a little less than seven months to get this all together. Better get going.
For more on CSO's coverage of identity theft, check out Sarah Scalet's article on "Five Ways to Fight Identity Theft".
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THE “RED FLAG RULE”
Are you compliant? New Law Passed By FTC
As you read in the (Red Flags Rules) you would need a Written Identity Theft Prevention Program and a employee training manual to be compliant with the New Law as of May 01, 2009. Our company has a complete employer training Program with employee training included. With this step-by-step program you the business owner could be compliant in 30 minutes, with training employees and have a written program in effect. The cost of this program is a one time cost of $219.00. You the employer can train your employees with ease and produce this manual when audited..
American Safety can provide a written program that will put you a cut above the rest in terms of credibility as a business owner. By having a program set in place you will be able to identify unusual account activity, and fraud alerts on a consumer report's. A program such as ours allows all financial institutions, creditors and small business owners the opportunity to implement a program that is appropriate to their size and complexity, as well as the nature of their operations. Staff training is provided and is catered to your needs. Avoid timely audits and costly fines. Put your “Red Flag” program into effect today contact your representative. www.americansafetypro.com
Here is an article with more informaiton about the new Identity Theft Red Flag rules - http://www.conetrix.com/articles/Identity-Theft-Red-Flags-the-readers-digest-version.aspx
In addition, here is a link to more resources, including a link to the final ruling and an online tool - http://www.conetrix.com/Identity-Theft-Prevention-Program.aspx
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