Identity Theft Prevention

The purpose of this advisory is to bring to your attention the rising occurrence of identity theft in the financial marketplace. Identity theft occurs when someone hijacks a consumer’s personal identifying information, such as their name, address, credit card or social security number, and uses the data to open new charge accounts, order merchandise, or borrow money. Many consumers have been victimized by identity theft already and the number of victims is rising exponentially. Congress addressed this concern with the passage of the Identity Theft and Assumption Deterrence Act of 1998. This act supplements existing laws that criminalize fraud by specifically addressing misappropriation of another’s identity for criminal purposes.

The Federal Trade Commission (FTC), the Federal agency that investigates and concerns itself with such threats to consumers, is calling for increased private and public efforts to combat this crime. They have taken the lead in coordinating the efforts of government agencies and organizations to develop and disseminate comprehensive consumer education materials for victims of identity theft, and those concerned with preventing identity theft.

The National Credit Union Administration (NCUA) recently participated in an FTC sponsored National Summit on Identity Theft. I have enclosed information, from that event, on preventative measures that may help protect your members from identity theft. Please also be aware that if you suspect an illicit attempt to obtain information concerning a member’s identity, you should report the matter to the appropriate authorities and file a Suspicious Activity Report (SAR). If you encounter victims of identity theft, refer them to the FTC Consumer Response Center at 1-877-FTCHELP, for assistance in addressing their problems.

We encourage credit unions to proactively protect their members when dealing with information in commerce. Sensitivity to privacy and identity theft protection is a good business strategy.