January 2008
Special Edition: New FACT Act Regulations
This special edition focuses on three new rules issued in recent weeks, all of which have their origins in the Fair and Accurate Credit Transactions Act of 2003 (FACT Act). The new rules were a long time coming, but there are only a few short months before your bank will have to comply with them. BOL Guru Lucy Griffin, Editor of Compliance Action, has summarized each of the three new rules.
Red Flag Rule
The Red Flag Rule, mandated by § 114 of the Fact Act, enlists your bank in the battle against identity theft. The new rule, which took effect 1/1/08, will require that you have policies and procedures in place no later than 11/1/08 to identify, prevent and minimize the effects of ID theft attacks on your customers. Read Lucy's summary of this complex regulation, in her article on the Red Flag Rule.
Address Changes
Most of the time, customer address changes are legitimate and routine. But some address changes are fraudulently initiated by identity thieves. Lucy describes how two common-sense practices are now mandated by rules issued under §§ 114 and 315 of the FACT Act. Like the Red Flag Rule, the address change requirements took effect 1/1/08 with an 11/1/08 compliance date, so you'll want to read Lucy's discussion of Changes in a Customer's Address.
Sharing Affiliate Information
It only makes sense that your bank can use customer information from your insurance agency and mortgage company affiliates to solicit business, right? Not so fast! New rules issued under § 214 of the FACT Act, with a mandatory compliance date of October 1, 2008, will make you jump through several hoops before being allowed to use any of that information to market to a consumer. Lucy's summary of these complicated rules is in her article on Sharing Affiliate Information.
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