FTC Delays Red Flag Rules Again and Again 11/4/2009
November 30, 2009
The FTC’s “Red Flag” mandate to curb identity theft was set to take effect on November 1, 2009, one full year after the original policy was to be enforced. Creditors and Financial Institutions were to develop and implement a written Identity Theft Prevention Program. At the 11th hour, it was announced that they will again delay enforcement until June 1, 2010.
According to the FTC, “The Rule was promulgated under the Fair and Accurate Credit Transactions Act, in which Congress directed the Commission and other agencies to develop regulations requiring ‘creditors’ and ‘financial institutions’ to address the risk of identity theft. The resulting Red Flags Rule requires all such entities that have ‘covered accounts’ to develop and implement written identity theft prevention programs to help identify, detect, and respond to patterns, practices, or specific activities – known as ‘red flags’ – that could indicate identity theft.”
Further, all employers that conduct background checks are supposed to have a policy in place to handle “Red Flag” Address Discrepancy Notifications from the National Consumer Reporting Agencies (mainly credit bureaus). This rule has been in effect since last November and we are still unclear what such notifications will look like when and if they occur.
For more information on these guidelines and how to comply check out:
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