The Office of Thrift Supervision, together with the other federal financial institution regulatory agencies and the Federal Trade Commission, has issued final rules and guidelines on identity theft "red flags" and address discrepancies. These rules and guidelines implement sections 114 and 315 of the Fair and Accurate Credit Transactions Act of 2003 (FACT Act), which amended the Fair Credit Reporting Act (FCRA). Compliance is mandatory on November 1, 2008. Most importantly, the rules require financial institutions and creditors offering any account for which there is a reasonably foreseeable risk of identity theft to establish a written Identity Theft Prevention Program (Program). The agencies have issued the guidelines to assist institutions and creditors as they develop their Programs. The guidelines include a supplement that identifies 26 patterns, practices, and specific forms of activity that are "red flags" signaling possible identity theft.
Under the rules, the Program must contain reasonable policies and procedures to:
1) Identify relevant patterns, practices, and specific forms of activity that are "red flags" signaling possible identity theft, and incorporate those red flags into the program;
2) Detect red flags that have been incorporated into the program;
3) Respond appropriately to any red flags that are detected to prevent and mitigate identity theft; and
4) Ensure the program is updated periodically to reflect changes in risks to customers or to the safety and soundness of the financial institution or creditor from identity theft.
The final rules also require credit and debit card issuers to develop policies and procedures to assess the validity of a request for a change of address followed closely by a request for an additional or replacement card. In addition, the final rules require users of consumer reports to develop reasonable policies and procedures that they must apply when they receive a notice of address discrepancy from a consumer reporting agency.
You can access the final rules and guidance electronically at http://www.ots.treas.gov/docs/4/481019.pdf
Please contact Ekita Mitchell, Consumer Regulations Analyst, at 202/906-6451 or your Regional Office if you have questions.