Preventing Identity Theft

The crime of identity theft has continued at epidemic proportions. Several widely reported surveys on the number of identity theft victims were recently released. A shocking report released by the Federal Trade Commission (FTC) in September 2003 estimated that approximately 10 million people were victims of identity theft in 2002 alone.

In response to new findings about identity theft, Congress adopted a number of provisions aimed at prevention and help for victims. The FTC recently published a revised guide for identity theft victims which includes new FACTA provisions. Take Charge: Fighting Back Against Identity Theft can be found at www.ftc.gov/bcp/conline/pubs/credit/idtheft.htm.

The practice known as "dumpster diving" provides identity thieves with a treasure trove of personal data. Irresponsible information disposal by businesses has been cited in numerous instances of fraud. Now under new FACTA provisions consumer reporting agencies and any business that uses a consumer report must adopt procedures for proper document disposal.

The FTC, the federal banking agencies, and the National Credit Union Administration (NCUA) have published final regulations to implement the new FACTA Disposal Rule. The FTC's disposal rule applies to consumer reporting agencies as well as individuals and any sized business that uses consumer reports. The FTC lists the following as among those that must comply with the rule:

• Lenders
• Insurers
• Employers
• Landlords
• Government agencies
• Mortgage brokers
• Automobile dealers
• Attorneys and private investigators
• Debt collectors
• Individuals who obtain a credit report on prospective nannies, contractors, or tenants
• Entities that maintain information in consumer reports as part of their role as service providers to other organizations covered by the rule.

More information on privacy rules, click FACTA, HIPAA, Gramm-Leach-Bliley.