The Federal Trade Commission assigns the responsibility to companies that are involved in a decision to extend credit, to publish a policy defining Red Flags and indicating how to appropriately respond.
1. Identifying Relevant Red Flags
The Broker Identified Red Flags can be found at Section A. Sections B. through E. were adopted directly from https://www.ftc.gov/tips-advice/business-center/guidance/fighting-identity-theft-red-flags-rule-how-guide-business .
A. Red Flags Defined by the Broker as being Relevant to the Property Management Industry:
i. A Social Security Number that is really a CPN.
ii. A Social Security Number that is reported as never being issued.
iii. A Social Security Number that is assigned to a deceased person.
iv. A Social Security Number that is assigned to a child.
v. A Social Security Number (SSN) issued on or after 2011.
vi. Driver’s License Number not found in the issuing state DMV records.
vii. Authorized User tradelines, from other than a spouse.
viii. Authorized User tradeline(s) not connected to a spouse with aggregate maximum credit limit exceeding the maximum credit limit of primary user tradelines.
ix. Recently created credit file.
x. Address history relatively brief compared to Applicant’s age.
xi. Frequent changes of residence.
xii. Numerous recent credit inquiries.
xiii. Inconsistencies in provided employment documents.
xiv. Unable to contact Supervisor.
xv. No reply from Supervisor.
xvi. Incomplete application.
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 credit freeze in response to a request for a credit report
iii. A notice of address discrepancy provided by a credit reporting company
iv. 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 telling you
D. Personal Identifying Information. Personal identifying information can indicate identity theft:
i. Inconsistencies with what you know — 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 you know 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. A person who omits required information on an application and doesn’t respond to notices that the application is incomplete
viii. A person 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 a “Notice of Conditional Application Approval” 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 Realtors (NAR), the National Association of Residential Property Managers (NARPM), and the Better Business Bureau (BBB), all 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.