Posts Tagged ‘ftc’

At the end of July, the Federal Trade Commission (FTC) put out a press release announcing that they would be extending the enforcement of the “Red Flags” Rule by another three months. This extension was granted based upon continued confusion from businesses about this new rule, particularly small businesses and entities.

The Federal Trade Commission staff will redouble its efforts to educate them about compliance with the “Red Flags” Rule and ease compliance by providing additional resources and guidance to clarify whether businesses are covered by the Rule and what they must do to comply.

The “Red Flags” Rule, which went into effect on January 1, 2008, requires many businesses and organizations (”creditors” and “financial institutions”) to implement a written Identity Theft Prevention Program. This program should detect early warning signs (red flags) of identity theft, take steps to prevent the crime, and mitigate damage that could be caused by it. The Red Flags Rule applies to “financial institutions” and “creditors,” though those terms apply more broadly than in typical use.

Check out the FTC site to determine if the Red Flags Rule applies to your organization, to get practical tips on spotting identity theft, and to learn how to put your ID Theft Prevention program into place. Based on this revised effort, the FTC will begin enforcement of the “Red Flags” rule on November 1, 2009.

Hat tip to Hunton & Williams

I know you’ve seen the advertisements for “FreeCreditReport.com,” the catchy commercials prompting people to avoid being victims of identity theft by monitoring their credit reports. The catch – that site wasn’t free, the credit report came free in exchange for a monthly credit-monitoring cost from Experian. According to the Fair Credit Reporting Act, all the consumer reporting companies (Equifax, Experian, TransUnion) are required to provide you a free credit report upon request every year. As the FTC notes:

The Federal Trade Commission has received complaints from consumers who thought they were ordering their free annual credit report, but instead paid hidden fees or agreed to unwanted services. Don’t be fooled by TV ads, email offers, or online search results. Go to the authorized source when you request your free report.

Well, the Federal Trade Commission (FTC) decided to start up their own service, a free one, no catches. Their website? AnnualCreditReport.com. Yeah, if that’s not enough, their ads also parody the Experian ones.

Here’s the same FreeCreditReport.com ad overlaid with warnings to be aware of deals like these:

Checking your credit once per year gives you an opportunity to make sure the information is accurate and up-to-date. Not only that, it helps you spot identity theft. Because your credit is used to evaluate insurance, employment and more, it’s an important step to take in safeguarding your identity.

Via dunning letter, philly.com

Despite the fact that the Garter study showed that only 5% of Americans report cases of fraud to the Federal Trade Commission (FTC), that’s still enough data for the FTC to release a report of their own. They put out the Top Consumer Complaints in 2008 showing that the top complaint was identity theft. You can imagine how much higher the figures would be if consumers reporting were higher.

The FTC report showed that, for the 9th year in a row, identity theft was the number one consumer complaint category. Of the 1,223,370 complaints received, 26% were related to identity theft.

The report breaks down the identity theft complaints into type. The most common form of reported identity theft is credit card fraud (20%) followed by government document/benefits fraud (15%), employment fraud (15%), phone or utilities fraud (13%), bank fraud (11%) and loan fraud (4%).

If you are a victim of identity theft, learn how to file a complaint with the FTC here.

In related news, research in the UK indicates that 1 in 3 Britons is expected to be a victim of card fraud in 2009 – a 33% increase over 2008. You can read more about that here.

Image: Clipart

The Federal Trade Commission (FTC) has released a report on Social Security Numbers (SSNs) and their correlation with Identity Theft. The report, which can be downloaded here [PDF], is a follow-up to a 2007 workshop on the same topic and the continued work of the President’s Identity Theft Task Force that was established in May 2006.

In the report, the FTC makes 5 recommendations to reduce the role of SSNs in identity theft. One of the recommendations is that Congress take action to strengthen procedures that private-sector organizations use to authenticate identities; they are pushing for nationwide standards in authentication. The task force believes that stronger authenticaton would make it more difficult for criminals to use stolen information, SSNs included, to impersonate consumers. As the report notes:

“Identity theft continues to be a major problem in this country, with victims numbering in the millions each year and out-of-pocket losses (primarily to businesses) in the billions of dollars.”

The Commission’s five recommendations are:

• Improve consumer authentication
• Restrict the public display and the transmission of SSNs
• Establish national standards for data protection and breach notification
• Conduct outreach to businesses and consumers
• Promote coordination and information sharing on use of SSNs

The task force believes that better authentication will make it more difficult to use SSNs to open new accounts or access existing accounts or services. They hope that this will, in turn, limit the demand for SSNs by criminals. Currently financial institutions that are federally regulated by banking agencies are the only private companies subjected to nationwide authentication standards.

You can continue reading more about that here, or read the more comprehensive Task Force Report here [PDF].

Via data breach watch

Identity Theft 911 has published a white paper about Identity Theft in California [PDF]. The white paper examines identity theft within the state and what steps are being taken by the government officials and businesses to combat the issue.

In 2007, California was ranked as the second-worst state in terms of identity theft complaints per capita, according to Federal Trade Commission (FTC) data. From 2002-2006, it held the third position on this list, so it’s clear that identity theft is a growing and persistent issue in California.

“Each year, more and more consumers fall victim to various forms of this insidious crime. This report puts a spotlight on California, highlighting several issues that are likely responsible for driving up these numbers in the state,” said Judd Rousseau, Chief Fraud Officer of Identity Theft 911.

According to the FTC, 1.5 million Californians were victims of identity theft in 2007 (out of a population of 36.5 million). The most common forms of identity theft were credit card fraud and employment-related fraud. The incidents of 2007 cost an estimated $749 million in out-of-pocket expenses for victims (and 6 million hours in resolution time). That’s an astronomical figure.

California has been responding to the issues of identity theft at the government level. New legislation has been passed, including breach notification laws, prohibitions for the public display of Social Security Numbers, and restrictions on the sharing / selling of personally identifiable information. The white paper outlines various other types of legislation that might mitigate the identity theft issue in California.

Via press release