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~,,~~ ~ VILLAGE OF TEQUESTA
AGENDA ITEM TRANSMITTAL FORM
1. VILLAGE COUNCIL MEETING:
Meeting Date:
October 9, 2008 Meeting Type: Regular Ordinance #: N/A
Consent Agenda: Yes Resolution #: 44-08
Originating Department: Finance
2. AGENDA ITEM TITLE: (Wording form the SUBJECT line of your staff report)
Adoption of the Village of Tequesta's Identity Theft Prevention Program
3. BUDGET /FINANCIAL IMPACT:
Account #: N/A Amount of this item: N/A
Current Budgeted Amount Available:
N/A Amount Remaining after item:
N/A
Budget Transfer Required: No Appropriate Fund Balance: No
4. EXECUTIVE SUMMARY OF MAJOR ISSUES: (This is a snap shot description of the agenda item)
The Village Council approval of the attached Identity Theft Prevention Program, to be in compliance
with the Federal Trade Commission's Identity Theft Red Flags Rule by the compliance date of
November 1, 2008.
5. ANPRUVALS:
Dept. Head
'~ ~ F `nonce Director:_JoAnn Forsythe ~
Attorney: (for legal sufficiency) Yes ~ No ^
Village Manager:
SUBMIT FOR COUNCIL DISCUSSION:
APPROVE ITEM: d
DENY ITEM: ^
MEMORANDUM
FINANCE DEPARTMENT
DATE: OCTOBER 9, 2008
TO: MICHAEL R COUZZO, VILLAGE MANAGER
FROM: JOANN FORSYTHE, FINANCE DIRECTOR
RE: RESOLUTION 44-08 -IDENTITY THEFT PREVENTION PROGRAM
Please add this item to the agenda of the October 9, 2008, Regular Meeting of the Village Council.
~'
Adoption of an Identity Theft Prevention Program
Background•
• The Identity Th~t Prevention Program (ree attach~_was developed to comply with the Federal Trade
Commission's (FTC) Identity Theft Red Flags Rule. The program consists of selecting methods
to detect red flags when accounts are fraudulent, procedures to prevent the establishment of false
accounts, procedures to ensure existing accounts are not being manipulated and procedures to
respond to identity theft.
• The primary purpose of the rule is to protect against the establishment of false accounts and
ensure existing accounts are not being manipulated.
• The attached program has been reviewed for legal sufficiency by the Village Attorney.
• The compliance date for implementation of this program is November 1, 2008.
Recommendalroa ofShafl`
Staff recommends approval of the attached Identit~~T gft Prevention Pmgram, to be in compliance with the
Federal Trade Commission's Identity Theft Red Flags Rule by the compliance date of November 1, 2008.
10/9/0810:31 AM
RESOLUTION NO. 44-08
A RESOLUTION OF THE VII.LAGE COUNCIL OF THE VILLAGE OF
TEQUESTA, FLORIDA, APPROVING AN "IDENTITY THEFT
PREVENTION PROGRAM" IN ACCORDANCE THE REQUIREMENTS
OF THE FAIR AND ACCURATE CREDIT TRANSACTIONS ACT OF
2003; PROVIDING AN EFFECTIVE DATE AND FOR OTHER
PURPOSES.
WHEREAS, the Fair and Accurate Credit Transactions Act of 2003 requires all creditors
with covered accounts to implement an identity theft prevention program by November 1, 2008;
and
WHEREAS, the Village of Tequesta's utility department falls within the definition of a
creditor with a covered account; and
WHEREAS, the Village desires to comply with the aforesaid requirements and in
furtherance thereof has prepared an identity theft prevention program that complies with the
requirements of the Fair and Accurate Credit Transactions Act of 2003; and
WHEREAS, the Village Council has determined that this identity theft prevention
program would serve the irrterests, and promote the health, safety and welfare of the citizens of
Tequesta.
NOW, THEREFORE, BE IT RESOLVED BY THE VII.LAGE COUNCIL OF
THE VILLAGE OF TEQUESTA, PALM BEACH COUNTY, FLORIDA, AS FOLLOWS:
Section 1: The Village Council of the Village of Tequesta, a municipal corporation,
hereby approves the "Identity Theft Prevention Program" attached hereto as Exhibit "A".
Section 2: This Resolution shall take effect November 1, 2008.
The foregoing Resolution was offered by ,who
moved its adoption. The motion was seconded by and
upon being put to a vote, the vote was as follows:
1
For Adoption Against Adoption
Mayor Patricia Watkins
Vice-Mayor Calvin Turnquest
Council Member Vince Arena
Council Member Jim Hurnpage
Council Member Tom Paterno
The Mayor thereupon declared the Resolution duly passed and adopted this 9th day of
October, 2008.
MAYOR OF TEQUESTA
ATTEST:
Lori McWilliams, CMC, Village Clerk
Pat Watkins
2
Effective November 1, 2008
Village of Tequesta Utility Department
Identity Theft
Prevention Program
Village of Tequesta Water Utility
Tequesta, Florida 33469
www.tequesta.org
I. PROGRAM ADOPTION
The Village of Tequesta Utility Department ("Utility") developed this Identity Theft Prevention
Program ("Program") pursuant to the Federal Trade Commission's Red Flags Rule ("Rule"),
which implements Section 114 of the Fair and Accurate Credit Transactions Act of 2003. 16 C.
F. R. § 681.2. This Program was developed with oversight and approval of the Village Manager
and the Village Council. After consideration of the size and complexity of the Utility's
operations and account systems, and the nature and scope of the Utility's activities, the Village
Manager and Village Council determined that this Program was appropriate for the Village of
Tequesta Utility Department, and therefore approved this Program on October 9, 2008.
Village of Tequesta, Water Utility --Identity Theft Prevention Program
Page 1 of 7
II. PROGRAM PURPOSE AND DEFINITIONS
A. Fulfilling requirements of the Red Flags Rule
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.
B. Red Flags Rule definitions used in this Program
The Red Flags Rule defines "Identity Theft" as "fraud committed using the identifying
information of another person" and a "Red Flag" as a pattern, practice, or specific activity that
indicates the possible existence of Identity Theft.
According to the Rule, a municipal utility is a creditor subject to the Rule requirements. The
Rule defines creditors "to include finance companies, automobile dealers, mortgage brokers,
utility companies, and telecommunications companies. Where non-profit and government
entities defer payment for goods or services, they, too, are to be considered creditors."
All the Utility's accounts that are individual utility service accounts held by customers of the
utility whether residential, commercial or industrial are covered by the Rule. Under the Rule, a
"covered account" is:
1. Any account the Utility offers or maintains primarily for personal, family or household
purposes, that involves multiple payments or transactions; and
2. Any other account the Utility offers or maintains for which there is a reasonably
foreseeable risk to customers or to the safety and soundness of the Utility from Identity
Theft.
"Identifying information" is defined under the Rule as "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
Village of Tequesta, Water Utility -Identity 'T'heft Prevention Program
Page 2 of 7
number, employer or taxpayer identification number, unique electronic identification number,
computer's Internet Protocol address, or routing code.
III. IDENTIFICATION OF RED FLAGS.
In order to identify relevant Red Flags, the Utility considers the types of accounts that it offers
and maintains, the methods it provides to open its accounts, the methods it provides to access its
accounts, and its previous experiences with Identity Theft. The Utility identifies the following
red flags, in each of the listed categories:
A. Notifications and Warnings From Credit Reporting Agencies
Red Flags
1) Report of fraud accompanying a credit report;
2) Notice or report from a credit agency of a credit freeze on a customer or applicant;
3) Notice or report from a credit agency of an active duty alert for an applicant; and
4) Indication from a credit report of activity that is inconsistent with a customer's usual pattern
or activity.
B. Suspicious Documents
Red Flags
1. Identification document or card that appears to be forged, altered or inauthentic;
2. Identification document or card on which a person's photograph or physical description is
not consistent with the person presenting the document;
3. 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
4. Application for service that appears to have been altered or forged.
C. Suspicious Personal Identifying Information
Red Flags
1. Identifying information presented that is inconsistent with other information the customer
provides (example: inconsistent birth dates);
2. Identifying information presented that is inconsistent with other sources of information
(for instance, an address not matching an address on a credit report);
3. Identifying information presented that is the same as information shown on other
applications that were found to be fraudulent;
Village of Tequesta, Water Utility -Identity Theft Prevention Program
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4. Identifying information presented that is consistent with fraudulent activity (such as an
invalid phone number or fictitious billing address);
5. Social security number presented that is the same as one given by another customer;
6. An address or phone number presented that is the same as that of another person;
7. 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
8. A person's identifying information is not consistent with the information that is on file
for the customer.
D. Suspicious Account Activity or Unusual Use of Account
Red Flags
1. Change of address for an account followed by a request to change the account holder's
name;
2. Payments stop on an otherwise consistently up-to-date account;
3. Account used in a way that is not consistent with prior use (example: very high activity);
4. Mail sent to the account holder is repeatedly returned as undeliverable;
5. Notice to the Utility that a customer is not receiving mail sent by the Utility;
6. Notice to the Utility that an account has unauthorized activity;
7. Breach in the Utility's computer system security; and
8. Unauthorized access to or use of customer account information.
E. Alerts from Others
Red Flag
Notice to the Utility 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.
IV. DETECTING RED FLAGS.
A. New Accounts
In order to detect any of the Red Flags identified above associated with the opening of a new
account, Utility personnel will take the following steps to obtain and verify the identity of the
person opening the account:
Village of Tequesta, Water Utility -Identity Theft Prevention Program
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Detect
1. 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;
2. Verify the customer's identity (for instance, review a driver's license or other
identification card);
3. Review documentation showing the existence of a business entity; and
4. Independently contact the customer.
B. Existing Accounts
In order to detect any of the Red Flags identified above for an existing account, Utility
personnel will take the following steps to monitor transactions with an account:
Detect
I. Verify the identification of customers if they request information (in person, via
telephone, via facsimile, via email);
2. Verify the validity of requests to change billing addresses; and
3. Verify changes in banking information given for billing and payment purposes.
V. PREVENTING AND MITIGATING IDENTITY THEFT
In the event Utility 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:
Prevent and Mitigate
1. Continue to monitor an account for evidence of Identity Theft;
2. Contact the customer;
3. Change any passwords or other security devices that permit access to accounts;
4. Not open a new account;
5. Close an existing account;
6. Reopen an account with a new number;
7. Notify the Program Administrator for determination of the appropriate step(s) to take;
8. Notify law enforcement; or
9. Determine that no response is warranted under the particular circumstances.
Village of Tequesta, Water Utility -Identity Theft Prevention Program
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Protect customer identifving information
In order to further prevent the likelihood of identity theft occurring with respect to Utility
accounts, the Utility will take the following steps with respect to its internal operating procedures
to protect customer identifying information:
1. Ensure that its website is secure or provide clear notice that the website is not secure;
2. Ensure complete and secure destruction of paper documents and computer files
containing customer information;
3. Ensure that office computers are password protected and that computer screens lock after
a set period of time;
4. Keep offices clear of papers containing customer information;
5. Request only the last 4 digits of social security numbers (if any);
6. Ensure computer virus protection is up to date; and
7. Require and keep only the kinds of customer information that are necessary for utility
purposes.
VI. PROGRAM UPDATES
This Program will be periodically reviewed and updated to reflect changes in risks to customers
and the soundness of the Utility from Identity Theft. At least once per year, the Program
Administrator will consider the Utility'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 Utility maintains and changes in the Utility's business arrangements with
other entities. After considering these factors, the Program Administrator will determine
whether changes to the Program, including the listing of Red Flags, are warranted. If warranted,
the Program Administrator will update the Program or present the Village Manager with his or
her recommended changes and the Village Manager will make a determination of whether to
accept, modify or reject those changes to the Program.
VII. PROGRAM ADMINISTRATION.
A. Oversight
Responsibility for developing, implementing and updating this Program lies with an Identity
Theft Committee for the Utility. The Committee is headed by a Program Administrator who
may be the head of the Utility or his or her appointee. Two or more other individuals appointed
by the head of the Utility or the Program Administrator comprise the remainder of the committee
membership. The Program Administrator will be responsible for the Program administration, for
ensuring appropriate training of Utility staff on the Program, for reviewing any staff reports
regarding the detection of Red Flags and the steps for preventing and mitigating Identity Theft,
Village of Tequesta, Water Utility - Iderrtity Then Preve~riion Program
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determining which steps of prevention and mitigation should be taken in particular circumstances
and considering periodic changes to the Program.
B. Staff Training and Reports
Utility staff responsible for implementing the Program shall be trained either by or under the
direction of the Program Administrator in the detection of Red Flags, and the responsive steps to
be taken when a Red Flag is detected. (The Utility may include in its Program how often
training is to occur. The Program may also require staff to provide reports to the Program
Administrator on incidents of Identity Theft, the Utility's compliance with the Program and the
effectiveness of the Program.)
C. Service Provider Arrangements
In the event the Utility engages a service provider to perform an activity in connection with one
or more accounts, the Utility will take the following steps to ensure the service provider performs
its activity in accordance with reasonable policies and procedures designed to detect, prevent,
and mitigate the risk of Identity Theft.
1. Require, by contract, that service providers have such policies and procedures in place;
and
2. Require, by contract, that service providers review the Utility's Program and report any
Red Flags to the Program Administrator.
D. Specific Program Elements and Confidentiality
For the effectiveness of Identity Theft prevention Programs, the Red Flag Rule envisions a
degree of confidentiality regarding the Utility'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 Identity Theft Committee 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.
Village of Tequesta, Water Utility -Identity Theft Prevention Program
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