If your organization sells products or services on credit, take note: May 1, 2009, is the deadline to comply with the identity theft requirements in the Fair and Accurate Credit Transactions Act (FACTA).
Dubbed the “red flag” rules, they require all financial institutions and creditors to create and implement a written program for “detection, prevention and mitigation” of identity theft of consumers’ data. In general, if a business regularly extends credit (or arranges for someone else to do so), the red flag rules apply. Accepting credit cards doesn’t make you a covered “creditor.”
Businesses must comply if there’s a “reasonably foreseeable risk” that identity theft could occur against a new or existing business account. If there is such a risk, you must develop a plan to “detect, prevent and mitigate” the theft and its effects. The plan must be in writing.
The Federal Trade Commission (FTC) has identified 26 examples of red flags that could be incorporated into your program. It says the plan must be adapted to your business, so you can’t adopt a canned format based on minimal standards.
The potential penalty for noncompliance: up to $2,500 per violation.
Read more about the red flag rules at www.businessmanagementdaily.com/redflagrules.
Like what you've read? ...Republish it and share great business tips!
Attention: Readers, Publishers, Editors, Bloggers, Media, Webmasters and more...
We believe great content should be read and passed around. After all, knowledge IS power. And good business can become great with the right information at their fingertips. If you'd like to share any of the insightful articles on BusinessManagementDaily.com, you may republish or syndicate it without charge.
The only thing we ask is that you keep the article exactly as it was written and formatted. You also need to include an attribution statement and link to the article.
" This information is proudly provided by Business Management Daily.com: http://www.businessmanagementdaily.com/9224/new-red-flag-identity-theft-mandate-takes-effect-may-1 "