“Red Flags” observed on an Application for credit are a potential indication of fraud. Companies that are involved in a decision to extend credit are required by the Federal Trade Commission to publish a policy defining Red Flags and take the reasonable actions required to stop fraud.
1. Identifying Relevant Red Flags
A. Red Flags Defined by the Broker as being Relevant to the Property Management Industry:
i. Mismatch between the account holder’s age and the duration of their credit history.
ii. Recently created credit file with a high credit score.
iii. Brief address history.
iv. Authorized User accounts that are not associated with a spouse.
v. Use of secured credit lines to build credit.
vi. A Social Security Number issued on or after 2011.
vii. A Social Security Number that is reported as never being issued.
viii. A Social Security Number that is assigned to a deceased person.
ix. Multiple identities associated with the same Social Security Number.
x. Driver’s License Number not found in the issuing state DMV records.
xi. Inconsistencies observed on Government issued I.D.s, passports, documents, etc.
xii. The name on the credit card used for payment does not match the name on the Applicant’s Driver’s License.
xiii. An email address used by several people opening accounts.
xiv. Frequent changes of residence.
xv. Address near a large international airport or shipping area.
xvi. Numerous recent credit inquiries.
xvii. Inconsistencies in provided employment documents.
xviii. Inconsistencies in provided bank statements.
xix. Arithmetical and/or mathematical errors in pay stubs.
xx. Unable to contact Supervisor.
xxi. No reply from Supervisor.
B. Alerts, Notifications, and Warnings from a Credit Reporting Company. Changes in a credit report or a consumer’s credit activity might signal identity theft:
i. A fraud or active duty alert on a credit report
ii. A notice of address discrepancy provided by a credit reporting company
iii. A credit report indicating a pattern inconsistent with the person’s history. For example, an increase in the volume of inquiries or the use of credit, especially on new accounts; an unusual number of recently established credit relationships; or an account that was closed because of an abuse of account privileges
C. Suspicious Documents. Documents can offer hints of identity theft:
i. Identification looks altered or forged
ii. The person presenting the identification doesn’t look like the photo or match the physical description
iii. Information on the identification differs from what the person with identification is reporting
D. Personal Identifying Information. Personal identifying information can indicate identity theft:
i. Inconsistencies — for example, an address that doesn’t match the credit report or the use of a Social Security number that’s listed on the Social Security Administration Death Master File
ii. Inconsistencies in the information a customer has submitted to you
iii. An address, phone number, or other personal information already used on an account known to be fraudulent
iv. A bogus address, an address for a mail drop or prison, a phone number that’s invalid, or one that’s associated with a pager or answering service
v. A Social Security number used by someone else opening an account
vi. An address or telephone number used by several people opening accounts
vii. Applicant who omits required information on an application and doesn’t respond to notices that the application is incomplete
viii. Applicant who can’t provide authenticating information beyond what’s generally available from a wallet or credit report — for example, someone who can’t answer a challenge question
E. Account Activity. How the account is being used can be a tip-off to identity theft:
i. A new account used in ways associated with fraud — for example, the customer doesn’t make the first payment, or makes only an initial payment; or most of the available credit is used for cash advances or for jewelry, electronics, or other merchandise easily convertible to cash
ii. An account used outside of established patterns — for example, nonpayment when there’s no history of missed payments, a big increase in the use of available credit, or a major change in buying or spending patterns or electronic fund transfers
2. Detecting Red Flags
The Broker collects personal information from the Rental Customer through a Lease Application and compares the information to three Credit Bureau Reports and a Background Report purchased from the Broker’s report vendor.
3. Prevent and Mitigate Identity Theft
Depending on the number of Red Flags detected and their severity, the Broker will:
i. Issue an “Adverse Impact Notice” requesting additional information to potentially resolve the Red Flag issue.
ii. Issue an Adverse Action Notice.
iii. Notify Law Enforcement.
4. Update the Program
The Broker is a member of the National Association of Residential Property Managers (NARPM) and the Better Business Bureau (BBB), both of which continually send the Broker information on this topic.
The Broker uses the most up to date technology and methods for collecting and transmitting personal information collected from Clients and Customers, including encryption and other security methods.