Recognizing Potential Red Flags

What this video covers

• The exact definition of a potential red flag: a pattern, practice, or specific activity indicating the possible existence of identity theft, recognized before confirmation
• Why a customer notice or concern about possible identity theft qualifies as a warning indicator, even with zero proof
• The distinction between confirmed identity theft and potential red flags, and why the exam tests the warning indicator and firm response, not the confirmed outcome
• The three-step identification verification control: verify identity to the extent reasonable and practicable, retain identifying information, and check federal agency lists designated by Treasury
• Why records of name, address, and other identifying information must be retained, not merely glanced at during account opening
• How the firm's written Identity Theft Prevention Program routes indicators through its own escalation process, and why responses must be commensurate with the degree of risk
• Why no response may be warranted depending on the circumstances, and how to avoid the trap that every red flag demands immediate outside reporting