Document Management for Red Flag Compliance

How you handle your clients applications and credit is crucial to
Red Flag Compliance regarding all your Document Management.

There are 26 FTC identified Red Flags which cover various forms
of consumer protections against having their identity stolen
or their identity misused by others via fraud.

The first four Red Flags cover the use and misuse of handling of
consumer reports, the first category of Document Management.

If you or your business is handling consumer reports in connection
with accounts, these are the first four Red Flags of document
management relative to potential fraud or identity theft....

1) A fraud or active alert is currently included with a consumer report
What will your business do? What action will you take?
This is what the FTC wants to know, this is why a Compliance
Binder is prepared...for business policy.

2) A consumer reporting agency provides a notice of a credit freeze
in response to a request for a consumer report.
This might indicate that suspicious activity has already occured.

3) A consumer reporting agency provides a notice of address
discrepancy... documents shown do not match the information on
file...possible i.d theft.
How will you handle this, how will you document this and how will
your Compliance Officer record this in your document management.

4) A consumer report indicates a pattern of activity that is inconsistent
with the (credit) history and usual pattern of activity (via the history)
of an applicant or customer...this MIGHT signal recent fraud or a
recent theft of identity.

How you prepare your business for these and the other 22 Red Flags
is vital for FTC Compliance under Red Flag Rules.

Red Flags Identification

Identification involves an evaluation of covered accounts (i.e. billing and records accounts) and the methods available to open, access, modify or close those accounts.

Preliminary questions helpful in identifying red flags might include the following:

• How is an individual’s identity verified before opening or accessing a covered account?
• What information is required for such verification?
• What is done with that information once it is collected?
• What third party service providers have access to data?

Red Flags FAQ



Red Flags Data Sheet

Red Flags Compliant

for assistance: Red Flags Compliance
Contact Us: GetCompliant@gmail.com