Consumer Blog
Companies must better guard your personal information
We have all heard about data breaches and other identity theft involving business, schools and government agencies that lose Social Security or credit card numbers of thousands - even millions - of people. Now, new federal regulations are going to put more of an onus on businesses to protect personal information.
Starting November 1 of this year, companies that deal in the credit world are required to have a written action plan to prevent, detect and recover from identity theft if it happens to their customers. The so-called red-flag rules naturally apply to companies like banks and credit card companies. But they also apply to retailers and others who pull credit reports as part of their decision making. In other words, if you check the credit of potential customers, this rule applies to you. We're talking banks and credit cards. We're also talking retailers like car dealerships and furniture, jewelry and appliance stores. Even government agencies that allow citizens to pay on credit are subject to these rules.
This is important ground to cover because in about 30% of all ID theft cases, a third-party organization is the culprit, through a data breach, crooked employee, etc. This blog post has a breakdown of how ID's get stolen.
The Federal Trade Commission has a summary of this new policy.
Technorati Tags: ID theft, data breach, federal trade commission, finance, identity theft, shopping and spending, red flag rules, moagoconsumer, consumer protection
Posted by on October 22, 2008 4:09 pm :: Comments (2) :: Permalink
2 Responses to "Companies must better guard your personal information"
says:
October 23, 2008 11:48 am
In the realm of risk, unmanaged possibilities become probabilities: These data breaches and thefts are due to a lagging business culture. As CIO, I'm always looking for ways to help my team, business teams, and ad hoc measures of various vendors, contractors and internal team members. While various systems of security are important, no system can overcome laxity, ignorance, or deliberate intent to harm. The real crux of the matter is education and training to the organization as a whole – and a recurring schedule of training – in building a sustained culture and awareness; an efficient prism through which every activity is viewed from a security perspective prior to action. I like to pass along things that work, in the hope that good ideas continue to make their way to me.
says:
October 30, 2008 6:50 pm
Companies have been letting people’s personal information get out causing identity theft, and everything else. In 30% of all identity theft cases a third party is the culprit, as the article says. If that is not ridiculous, then I don’t know what is. The people are supposed to trust the people they give their information to. Well we should be able to at least. Thirty percent means that two out of six people are having identity theft. We ac consumers might as well write down out information, and post it online. Consumers are supposed to trust that their information is safe from a security breach, or lost files, and crooked employees. So because of this the government has come up with this new genius plan, if that’s what you would call it. Now the government is putting tight restrictions on the companies that deal in the credit world. Now the companies have to have a written action plan to protect their customers from identity theft. Identity theft has been going on for years, so why is the government just now doing something about it. I think the reason is to promote consumer mentality. Consumer mentality is the thought that advertiser want you as a consumer to have while shopping and consuming. It is the feeling of a sense of identity and safety you feel when purchasing a product. People now days don’t feel safe giving their information to businesses, because of how much identity theft is going on. So because of that some companies are losing more and more business, which means more and more money. They needed to find a way to convince the consumers that their information is safe, and what better way to do so, than to have the government come up with a plan of action. The company’s goal is to increase their business, how much money they are making, so why not come up with a way to do just that. Don’t get me wrong, I do think that this is a good plan, but I think the reasoning for it was to more benefit the companies than the consumers. Again, people are all about making money and doing what they have to, to do just that.
