Identity theft has become a multi-million dollar business, causing many people both financial and emotional harm. There are endless stories of credit card theft, credit card rings, and financial fraud. These problems led to the creation of the “Red Flags Rule” by the FTC.
The FTC defines “Identity Theft” as a fraud committed or attempted using the identifying information of another person without authority.[i]
Originally, Congress passed the Fair and Accurate Credit Transactions Act (FACTA) in 2003 to develop rules and guidelines for detection, prevention, and mitigation of identity theft for financial institutions and creditors. Then, the Fair Trade Commission (FTC) created the “Red Flags Rule” for businesses in 2007 and imposed active enforcement November 1, 2009. This rule requires that business have a written Identify Theft Prevention Program to detect the warning signs or “red flags” of identity theft in daily operations. Read more →