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• <br /> ISSN 1551-8450—Volume 17, Issue 37—September 15,2008 <br /> Utilities scramble on FTC identity-theft rule <br /> Water utilities and AWWA are scrambling to get up to speed on a Federal Trade Commission <br /> rule that includes water utilities among financial entities that must have a written plan by Nov. <br /> 1 describing how they will identify and respond to "red flags" that indicate identity theft <br /> involving customer accounts. <br /> Pavneet Singh, attorney in the FTC's Division of Privacy and Identity Protection, said the FTC <br /> sent out a business alert in October 2007 and published notice of the joint final rules and <br /> guidelines in the Federal Register last Nov. 9 noting that compliance is mandatory by Nov. 1, <br /> 2008. <br /> "We have been trying to work with various trade associations to get the word out about the <br /> rule," Singh said, adding that she hadn't yet contacted AWWA's Government Affairs office but <br /> • intended to do so soon. "It will be great to have a contact in the water industry," she said. <br /> The FTC, which has enforcement responsibility for this amendment to the Fair and Accurate <br /> Credit Transactions Act of 2003, is still working on the rule's compliance guide, which Singh <br /> thought would be out before the Nov. 1 deadline. That guide will be useful to utilities trying to <br /> put their plans together, she said. <br /> The agency has been trying to clarify that the definition of"credit" and "creditor" is broader than <br /> just financial institutions, she said. Adding examples of consumer accounts such as "mortgage <br /> loan, automobile loan, margin account,cell phone account, utility account,checking account, or <br /> savings account" was one way to do that, she explained, noting that "utilities" were not as <br /> prominently mentioned in the proposal published in the Federal Register July 18, 2006, as they <br /> are in the final rule. <br /> The definition of"credit" and "creditor" — language from the Equal Credit Opportunity Act <br /> —applies to any entity that allows a consumer to open an account and get services and be billed <br /> after the fact, she said. It would not apply if the consumer were required to pay in advance of <br /> getting service. <br /> The written identity-theft "red flag" program must address how the organization will look for and <br /> respond to signs of identity theft. The purpose is the detection,prevention and mitigation of <br /> identify theft,beginning with the requirement of proof of identity before an account is <br /> established, as required by the US Patriot Act. <br /> • <br />