THE EDGE
MAY 8, 2008

Identity theft
Simple tactics can keep your company free from criminal mideeds.

Identity theft is a common threat and concern in today’s growing population. To protect your company, you will need to take measures to ensure your business and employees act within regulations. There are laws in place to guard consumers against identity theft, such as the Gramm, Leach Bliley Act, which protects personal financial information held by institutions. If information is violated, anyone in management is at risk. The penalties can include criminal charges, civil liability and fines.

OC METRO Business Magazine interviewed David M. Ward, an independent associate with Pre-Paid Legal Services Inc., a company that markets legal plans and identity theft protection, to answer questions about protecting your business from identity theft.

• What are the different types of identity theft?
There are five common types: financial (credit/banking), driver’s license, criminal, Social Security and medical.

• How can a business owner protect employees from potential fees, fines and lawsuits?
1. Business owners must acquaint themselves with state and federal laws. They can get information from the Federal Trade Commission (ftc.gov); books, such as “The Silent Crime: What You Need to Know About Identity Theft,” by McCoy and Schmidt; or they can ask their lawyers. Unfortunately, most lawyers don’t know about identity theft, because it’s not taught in law school, and it’s a new and emerging area.

2. Appoint someone to be in charge of protecting the company, someone who will take the initiative and learn the laws to ensure your company is in compliance. Large businesses usually have legal and compliance staff, or in-house counsel to make sure the company follows the vast array of laws.

3. Set up a policy manual with rules and guidelines for employees.

4. Educate your employees on the use of non-public information, which includes address, date of birth, medical information, banking and credit information. Make sure your employees understand the importance of shredding documents, locking file cabinets and keeping sensitive documents safe from access. Include this in your policy manual.

5. Protect your company from liability through an employee confidentiality document. Employees are asked to sign and acknowledge that they are aware of and will comply with state and federal regulations.

6. Hire a consultant or law firm, or have an authorized expert provide training for employees, as well as assistance in implementing a compliance plan.

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