Fed “Red Flags” Identity Theftby Tim Manni
I guess the government finally realized that Todd Davis’ company Life Lock wasn’t enough to put American’s minds at ease about identity theft. The Federal Trade Commission (FTC), the federal bank regulatory agency, and the National Credit Union Administration (NCUA) have instituted “Red Flag Rules.” These regulations, part of the Fair and Accurate Credit Transaction Act of 2003, will require financial institutions and creditors to develop and implement a written prevention program that will detect and respond to patterns, practices, or specific activities that point to identity theft by November 1, 2008.
Financial institutions and creditors will monitor unusual account activity, fraud alerts, suspicious account application documents, and suspicious personal info.
“Red Flag Rules” will be managed by the Board of Directors or senior employees of the financial institutions and creditors. The written prevention program must include employee training, appropriate action to solve the theft issue, as well as appropriate updates to their system.