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Executive Summary
In 2008, identity theft rose to 22% affecting 9.9 million American adults annually. The average fraud per incident was $4,849, while the total annual fraud amount increased to a staggering $48 billion. At that rate, one of every five Americans will have their identity stolen this year alone. Fraud continues to be a substantial threat and difficulty for the U.S. increasing considerably by 12.6% annually. The average cost of new account fraud is $3197, and typically takes 151 days to detect an occurrence, according to Javelin Strategy and Research. The federal government developed and imposed rules and regulations to prevent thieves from stealing private data. But there was a loophole: these rules did not clearly define the use of stolen data after it was stolen.
The FTC Red Flag Rule: What It Means For Your Business
The FTC Red Flag Rule: What It Means For Your Business
The FTC Red Flag Rule: What It Means For Your Business
The rule lists 26 possible red ags that you may want to consider, but you are not required to use all (or even any) of these possible indicators in your program. The burden of determining how someone could steal from you is yours. Ximena Boyle C&M Software, LLC Business Analyst
The FTC Red Flag Rule: What It Means For Your Business
The FTC Red Flag Rule: What It Means For Your Business
If you do not have one, or it is poorly written and/or executed, the plaintiff will likely allege a breach of duty to protect the information. In summary, the Red Flags Rule is likely to become the standard of care that all companies will need to provide to prevent identity theft. Skipping Red Flag compliance will expose you to real regulatory, reputational and litigation risks.
Contact information Katherine Moreno Marketing Manager C&M Software T 786-629-1512 E katherine.moreno@cmsw.com
Content in this publication is not intended to answer specic questions or suggest suitability of action in a particular case. For additional information on the issues discussed, consult a C&M Software representative.
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The FTC Red Flag Rule: What It Means For Your Business