Identity Theft Prevention Program Policy

Village of Lake Linden

OFFICIAL POLICY & PROCEDURE

IDENTITY THEFT PREVENTION PROGRAM

Purpose

To establish an Identity Theft Prevention Program designed to detect, prevent and mitigate identity theft in connection with the opening of a covered account or an existing covered account and to provide for continued administration of the Program in compliance with the Federal Trade Commission’s Red Flags Rule (Part 681 of Title 16 of the Code of Federal Regulations) implementing Sections 114 and 315 of the Fair and Accurate Credit Transactions Act (FACTA) of 2003.

Under the Red Flag Rule, every financial institution and creditor is required to establish an “Identity Theft Prevention Program” tailored to its size, complexity and the nature of its operation. Each program must contain reasonable policies and procedures to:

1. Identify relevant Red Flags for new and existing covered accounts and incorporate those Red Flags into the Program;

2. Detect Red Flags that have been incorporated into the Program;

3. Respond appropriately to any Red Flags that are detected to prevent and mitigate Identity Theft; and

4. Ensure the Program is updated periodically, to reflect changes in risks to customers or to the safety and soundness of the creditor from Identity Theft.

Definitions

Identifying information means any name or number that may be used, alone or in conjunction with any other information, to identify a specific person, including: name, address, telephone number, social security number, date of birth, government issued driver’s license or identification number, alien registration number, government passport number, employer or taxpayer identification number, unique electronic identification number, computer’s Internet Protocol address, or routing code.

Identity theft means fraud committed or attempted using the identifying information of another person without authority.

A covered account means:

1. An account that a financial institution or creditor offers or maintains, primarily for personal, family, or household purposes that involves or is designed to permit multiple payments or transactions. Covered accounts include credit card accounts, mortgage loans, automobile loans, margin accounts, cell phone accounts, utility accounts, checking accounts and savings accounts; and

2. Any other account that the financial institution or creditor offers or maintains for which there is a reasonably foreseeable risk to customers or to the safety and soundness of the financial institution or creditor from identity theft, including financial, operational, compliance, reputation or litigation risks.

A red flag means a pattern, practice or specific activity that indicates the possible existence of identity theft.

Policy

A. IDENTIFICATION OF RED FLAGS. The Village of Lake Linden identifies the following red flags, in each of the listed categories:

1. Suspicious Documents

a. Identification document or card that appears to be forged, altered or inauthentic;

b. Identification document or card on which a person’s photograph or physical description is not consistent with the person presenting the document;

c. Other document with information that is not consistent with existing customer information (such as if a person’s signature on a check appears forged); and

d. Application for service that appears to have been altered or forged.

2. Suspicious Personal Identifying Information

a. Identifying information presented that is inconsistent with other information the customer provides (example: inconsistent birth dates);

b. Identifying information presented that is inconsistent with other sources of information (for instance, an address not matching an address on a credit report);

c. Identifying information presented that is the same as information shown on other applications that were found to be fraudulent;

d. Identifying information presented that is consistent with fraudulent activity (such as an invalid phone number or fictitious billing address);

e. Social security number presented that is the same as one given by another customer;

f. An address or phone number presented that is the same as that of another person;

g. A person fails to provide complete personal identifying information on an application when reminded to do so (however, by law social security numbers must not be required); and

h. A person’s identifying information is not consistent with the information that is on file for the customer.

3. Suspicious Account Activity or Unusual Use of Account

a. Change of address for an account followed by a request to change the account holder’s name;

b. Payments stop on an otherwise consistently up-to-date account;

c. Account used in a way that is not consistent with prior use (example: very high activity);

d. Mail sent to the account holder is repeatedly returned as undeliverable;

e. Notice to the Village that a customer is not receiving mail sent by the Village;

f. Notice to the Village that an account has unauthorized activity;

g. Breach in the Village’s computer system security; and

h. Unauthorized access to or use of customer account information.

4. Alerts from Others

a. Notice to the Village from a customer, identity theft victim, law enforcement or other person that it has opened or is maintaining a fraudulent account for a person engaged in Identity Theft.

B. DETECTING RED FLAGS.

1. New Accounts. In order to detect any of the Red Flags identified above associated with the opening of a new account, Village personnel will take the following steps to obtain and verify the identity of the person opening the account:

a. Require certain identifying information such as name, date of birth, residential or business address, principal place of business for an entity, driver’s license or other identification;

b. Verify the customer’s identity (for instance, review a driver’s license or other identification card);

c. Review documentation showing the existence of a business entity; and/or

d. Independently contact the customer.

2. Existing Accounts. In order to detect any of the Red Flags identified above for an existing account, Village personnel will take the following steps to monitor transactions with an account:

a. Verify the identification of customers if they request information (in person, via telephone, via facsimile, via email);

b. Verify the validity of requests to change billing addresses; and

c. Verify changes in banking information given for billing and payment purposes.

B. PREVENTING AND MITIGATING IDENTITY THEFT.

In the event Village personnel detect any identified Red Flags, such personnel shall take one or more of the following steps, depending on the degree of risk posed by the Red Flag:

1. Prevent and Mitigate

a. Continue to monitor an account for evidence of Identity Theft;

b. Contact the customer;

c. Change any passwords or other security devices that permit access to accounts;

d. Not open a new account;

e. Close an existing account;

f. Reopen an account with a new number;

g. Notify the Township Manager for determination of the appropriate step(s) to take;

h. Notify law enforcement; and/or

i. Determine that no response is warranted under the particular circumstances.

2. Protect Customer Identifying Information

a. In order to further prevent the likelihood of identity theft occurring with respect to Village accounts, the Village will take the following steps with respect to its internal operating procedures to protect customer identifying information:

b. Ensure that its website is secure or provide clear notice that the website is not secure;

c. Ensure complete and secure destruction of paper documents and computer

files containing customer information;

d. Ensure that office computers are password protected and that computer

screens lock after a set period of time;

e. Keep offices clear of papers containing customer information;

f. Request only the last 4 digits of social security numbers (if any);

g. Ensure computer virus protection is up to date; and

h. Require and keep only the kinds of customer information that are necessary

for utility purposes.

C. PROGRAM UPDATES.

This Program will be periodically reviewed and updated to reflect changes in risks to customers and the soundness of the Village from Identity Theft. The Village Council will consider the Village’s experiences with Identity Theft situation, changes in Identity Theft methods, changes in Identity Theft detection and prevention methods, changes in types of accounts the Village maintains and changes in the Village’s business arrangements with other entities. After considering these factors, the Village Clerk will determine whether changes to the Program, including the listing of Red Flags, are warranted. If warranted, the Village Clerk will present the Village Council with his/her recommended changes and the Council will make a determination of whether to accept, modify or reject those changes to the Program.

D. PROGRAM ADMINISTRATION.

1. Oversight. Responsibility for developing, implementing and updating this Program lies with the Village Council. The Village Clerk will be responsible for the Program administration, for ensuring appropriate training of Village staff on the Program, for reviewing any staff reports regarding the detection of Red Flags and the steps for preventing and mitigating Identity Theft, determining which steps of prevention and mitigation should be taken in particular circumstances and considering periodic changes to the Program.

2. Staff Training. Village staff responsible for implementing the Program shall be trained either by or under the direction of the Village Clerk in the detection of Red Flags, and the responsive steps to be taken when a Red Flag is detected. Village staff. Documentation on incidents of Identity Theft, the Village’s compliance with the Program and the effectiveness of the Program shall be presented to the Village Council upon request by the Village Clerk.

3. Specific Program Elements and Confidentiality. For the effectiveness of Identity Theft prevention Programs, the Red Flag Rule envisions a degree of confidentiality regarding the Village’s specific practices relating to Identity Theft detection, prevention and mitigation. Therefore, under this Program, knowledge of such specific practices are to be limited to the Village Council and those employees who need to know them for purposes of preventing Identity Theft. Because this Program is to be adopted by a public body and thus publicly available, it would be counterproductive to list these specific practices here. Therefore, only the Program’s general red flag detection, implementation and prevention practices are listed in this document.

Authority & Revisions

Authority for developing and implementing this policy rests with the Lake Linden Village Council, as the utility provider, and under the Village Law Act of 1895, as amended. Periodic review and/or revisions are solely at the discretion of the Village Council. This policy shall be considered in effect for all current and future utility programs provided by and operated by the Village of Lake Linden.

Policy adopted this ______ day of ______________, 20___.

[Posted on the website of the Village of Lake Linden]