News
Examiners Will Look for Extra Steps in FACT Act Compliance: Consultants
By Matt Squire
printFinancial regulatory examiners will be checking that banks are not overly relying on their existing monitoring systems to comply with new federal rules meant to curb identity theft, say consultants. The 2003 Fair and Accurate Credit Transactions Act, or FACT Act, requires that financial institutions implement programs to detect and prevent identity theft, a widespread problem that cost businesses and consumers a total of $15.6 billion in 2006 according the Federal Trade Commission (FTC). Banks, which have until November 1 to comply with the new rules, must develop means to investigate customer address discrepancies and develop programs to detect...
TO READ THE FULL STORY
Subscribe
Learn More
Related News
PricewaterhouseCoopers will pay $25 million and revise its consulting practices after removing incriminating findings from a 2008 report drafted for Japan's largest bank, a New York State regulator said.
U.S. lawmakers proposed legislation Wednesday to combat the pilfering of tax refunds, now the most common type of identity theft-related fraud in the country.
The Internal Revenue Service's Criminal Investigations division is shifting resources to better investigate the "alarming" growth of stolen tax refunds, according to a senior IRS official.
Instances of cybercrime and identity theft in New York City rose 50 percent over the past five years, while some municipal precincts are citing the violations more than any other crimes.
The number of suspicious activity reports filed on potential identity theft increased over 120 percent between 2004 and 2009, the head of the U.S. Treasury Department's financial intelligence unit said Monday.
Reports of check fraud tied to identity theft rose in 2009 even as instances of related loan and credit fraud fell, according to a study released Friday by the Identity Theft Resource Center.
As many as 85 percent of banks have implemented adequate compliance systems aimed at rooting out identity thieves and limiting the number of data breaches, according to analysts.
The Federal Trade Commission Wednesday again pushed back the enforcement deadline of a controversial rule requiring financial institutions and "creditors" to take steps to prevent identity theft-related data breaches.
Financial institutions that have recently become bank holding companies will face much tougher anti-money laundering regulatory exams through the Federal Reserve Board, say compliance experts.
The U.S. Federal Trade Commission has given financial institutions an additional six months to develop programs to prevent identity theft due to confusion in the industry over the scope of the agency's rules.
Congress is considering a request that would allow the Federal Trade Commission to levy fines against companies with poor controls over sensitive customer data, according to a report released Tuesday.
Regulation requiring banks to prevent identity theft-related data breaches could be as difficult and expensive to implement as anti-money laundering provisions and the cost of failing to comply could be even higher, say bankers and former regulators.
The U.S. Financial Crimes Enforcement Network will seek to share Bank Secrecy Act data more widely and cooperate more with foreign law enforcement officials pursuing money laundering and terrorist financing investigations as part of its five-year strategic plan.
Some 3.7 percent of American adults, or 8.3 million individuals, had their personal data stolen or misused in 2005, according to a Federal Trade Commission study released Tuesday. The estimated total loss from ID theft for American consumers was $15.6 billion.
Charges made to fraudulent accounts in the victims' names ranged between $50 and $500,000 and, in aggregate, increased 78 percent from 2004 to 2006, according to a study by the Identity Theft Resource Center.
A report issued by San Diego, Calif.-based ID Analytics, which makes ID theft software, looked at about a dozen data breaches involving Social Security numbers and other identifying information.
A security breach at retailer TJX Cos. last year cost banks that reissued payment cards as much as $83 million, according to estimates by credit card company Visa USA. Credit card company officials say the breach exposed about 100 million credit and debit card numbers.
Final federal banking regulations for monitoring identity theft moved forward on Monday as the Federal Deposit Insurance Corp., one of six federal banking agencies considering the measures, approved them.
Financial institutions have been slow to adopt biometric technologies that identify people by physical characteristics, such as fingerprints, as part of their information security programs.
Security professionals are warning banks of an emerging type of identity fraud called synthetic ID theft that victimizes financial institutions directly rather than preying on their individual customers.