HomeMy WebLinkAboutITEM VIII-B-1AGENDA BILL APPROVAL FORM
~~~~WASHINGTON
Agenda Subject:
Date:
Resolution No. 4465
A ril 14 2009
Department: Finance
Attachments: Resolution No. 4465
Budget Impact:
and City of Auburn Identity Theft
Protection Pro ram.
Administrative Recommendation:
City Council adopt Resolution No. 4465.
Background Summary:
Resolution No. 4465 Authorizes the Mayor and City Clerk to adopt an identity theft protection
program. "Red Flags Rule," part of the Fair and Accurate Credit Transactions Act of 2003
(FACTA), is a Rule requiring institutions and creditors with "covered accounts" to have an
identity theft prevention program in place by May 1, 2009, to identify, detect, and respond to
patterns, practices or specific activities which could indicate identity theft. Because cities that bill
for utilities are "creditors" under the Rule, City of Auburn must comply with the Rule and develop
a written program that identifies and detects the relevant warning signs (red flags) of identity
theft. The program must also describe appropriate responses that would prevent and mitigate
identity theft and provide for the update of the program. The program must be approved by the
City Council and implemented by senior management staff.
N0420-1
01.8
Reviewed by Council & Committees:
Reviewed by Departments & Divisions:
❑ Arts Commission COUNCIL COMMIlTEES:
❑ Building p M&O
❑ Airport 0 Finance
❑ Cemetery ❑ Mayor
❑ Hearing Examiner ED Municipal Serv.
E Finance ❑ Parks
❑ Human Services ❑ Planning & CD
❑ Fire ❑ Planning
❑ Park Board ❑Public Works
0 Legal ❑ Police
❑ Planning Comm. ❑ Other
❑ Public Works ❑ Human Resources
❑ Information Services
Action:
Committee Approval: ❑Yes ❑No
Council Approval: ❑Yes ❑No Call for Public Hearing
Referred to Until
Tabled
Councilmember: Backus
Staff: Coleman
Meetin Date: A ril 20, 2009
Item Number: VI11.6.1
AU$URN * MQRE THAN YOU 1MAGINED
RESOLUTION NO. 4465
A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF AUBURN, WASHINGTON, APPROVING
AND ADOPTING AN IDENTITY THEFT
PREVENTION PROGRAM
WHEREAS, The Fair and Accurate Credit Transactions Act of 2003, Pub.
L. 108-159, ("Red Flags Rule") requires certain financial institutions and creditors
with "covered accounts" to prepare, adopt, and implement an identity theft
prevention program to identify, detect, respond to and mitigate patterns, practices
or specific activities which could indicate identity theft; and
WHEREAS, the City of Auburn maintains certain continuing accounts with
utility service customers and for other purposes which involve multiple payments
or transactions, and such accounts are "covered accounts" within the meaning of
the Red Flags Rule; and
WHEREAS, to comply with the Red Flags Rule, City Staff have prepared
an identity theft prevention program in the form attached hereto as Exhibit "A"
and incorporated herein by this reference (the "ITPP" or the "Program") and have
recommended that the Program now be approved and adopted by the City
Council for implementation;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF AUBURN,
HEREBY RESOLVES as follows:
Resolution No. 4465
April 14, 2009
Page 1 of 2
Section 1. That
City Council
approves
and
adopts the Identity Thefi
Prevention Program in
substantially
the same
form
as attached hereto and
incorporated herein.
Section 2. That the Mayor is authorized to implement such
administrative procedures as may be necessary to carry out the directives of this
legislation.
Section 3. That this Resolution shall take effect and be in full force
upon passage and signatures hereon.
Dated and Signed this day of , 2009.
CITY OF AUBURN
PETER B. LEWIS
MAYOR
ATTEST:
Danielle E. Daskam, City Clerk
TO FORM:
iel B. H ~~;-~it~A#6rney
Resolution No. 4465
April 14, 2009
Page 2 of 2
CITY OF AUBURN
IDENTITY THEFT PREVENTION PROGRAM
1. PROGRAM ADOPTION
The City of Auburn developed this Identity Theft Prevention Program
("Program") pursuant to the Federal Trade Commission's Red Flags Rule ("Rule"),
which implements Sections 114 and 315 of the Fair and Accurate Credit Transactions Act
of 2003. This Program was developed with the oversight and approval of the City's
Finance Director. After consideration of the size and complexity of the City's operations
and account systems, and the nature and scope of the City's activities, the City Council
determined that this Prograin was appropriate for the Cit~, and therefore approved this
Program by the adoption of Ordinance No. 4465 on the 20t day of April 2009.
II. PROGRAM PURPOSE AND DEFINITIONS
A. Fulfilling Requirements of the Rule.
Under the 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. The Program must contain reasonable policies and procedures to:
• Identify relevant red flags as defined in the Rule and this Program for new and
existing covered accounts, and incorporate those red flags into the Program;
• Detect red flags that have been incorporated into the Program;
• Respond appropriately to any red flags that are detected to prevent and mitigate
identity theft; and
• Update the Program periodically to reflect changes in risks to customers or to the
safety and soundness of the City from identity theft.
B. Rule Definitions Used in this Progiam.
For the purposes of this Program, the following definitions apply:
Account. "AccounY" means a continuing relationship established by a person
with a creditor to obtain a product or service for personal, family, household or business
purposes.
CITY OF AUBURN IDENTITY THEFT PREVENTION PROGRAM
Page 1 of 8
Covered Account. A"covered account" means:
a. Any account the City offers or maintains primarily for personal, family
or household purposes, that involves multiple payments or transactions; and
b. Any other account the City offers or maintains for which there is a
reasonably foreseeable risk to customers or to the safety and soundness of the City from
identity theft.
Creditor. "Creditor" has the same meaning as defined in Section 701 of the
Equal Credit Opportunity Act, 15 U.S.C. 1691a, and includes a person or entity that
arranges for the extension, renewal or continuation of credit, including the City.
Customer. A"customer" means a person or business entity that has a covered
account with the City.
Financial Institution. "Financial institution" means a state or national bank, a
state ar federal savings and loan association, a mutual savings bank, a state or federal
credit union, or any other entity that holds an account belonging to a customer.
Identifying Information. "Identifying information" means any name or
number that may be used, alone or in conjunction with any other information, to identity
a specific person, including name, address, telephone number, social security number,
date of birth, government passport number, employer or taxpayer identification number
or unique electronic identification number.
Identity Theft. "Identity theft" means fraud committed using the identifying
information of another person.
Red Flag. A"red flag" means a pattern, practice, or specific activity that
indicates the possible existence of identity theft.
Service Provider. "Service provider" means a person or business entity that
provides a service directly to the City relating to or in connection with a covered account.
III. IDENTIFICATION OF RED FLAGS
In order to identify relevant red flags, the City shall review and consider the types
of covered accounts that it offers and maintains, the methods it provides to open covered
accounts, the methods it provides to access its covered accounts, and its previous
experiences with identity theft. The City identifies the following red flags, in each of the
listed categories:
CITY OF AUBURN IDENTITY THEFT PREVENTION PROGRAM
Page 2 of 8
A. Notification and Warnings from Credit Reporting Agencies - Red Flags.
• Report of fraud accompanying a credit report;
• Notice or report from a credit agency of a credit freeze on a customer or
applicant;
• Notice or report from a credit agency of an active duty alert for an
applicant; and
• Indication from a credit report of activity that is inconsistent with a
customer's usual pattern or activity.
B. Suspicious Documents - Red Flags.
• Identification document or card that appears to be forged, altered or
inauthentic; (such as inconsistent phone number, mailing address, or name
on file)
• Identification document or card on which a person's photograph or
physical description is not consistent with the person presenting the
document;
• Other document with information that is not consistent with existing
customer information (such as a person's signature on a check appears
forged); and
• Application for service that appears to have been altered or forged.
C. Suspicious Personal Identifying Information -Red Flags.
• Identifying information presented that is inconsistent with other
information the customer provides (such as inconsistent birth dates);
• Identifying information presented that is inconsistent with other sources of
information (for instance, an address not matching an address on a driver's
license);
• Identifying information presented that is the same as information shown
on other applications that were found to be fraudulent;
• Identifying information presented that is consistent with fraudulent
activity (such as an invalid phone number or fictitious billing address);
• Social security number presented that is the same as one given by another
customer;
CITY OF AUBURN IDENT[TY THEFT PREVENTION PROGRAM
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• An address or phone number presented that is the same as that of another
person;
• Failing to provide complete personal identifying information on an
application when reminded to do so (however, by law social security
numbers must not be required to receive any City services); and
• Identifying information which is not consistent with the information that is
on file for the customer.
D. Suspicious Account Activity or Unusual Use of Account - Red Flaas.
• Change of address for an account followed by a request to change the
account holder's name;
• Payments stop on an otherwise consistently up-to-date account;
• Account used in a way that is not consistent with prior use (such as very
high activity);
• Mail sent to the account holder is repeatedly returned as undeliverable;
• Notice to the City that a customer is not receiving mail sent by the City;
• Notice to the City that an account has unauthorized activity;
• Breach in the City's computer system security; and
• Unauthorized access to or use of customer account information.
E. Alerts from Others - Red Flag.
• Notice to the City from a customer, a victim of identity theft, a law
enforcement authority or other person that the City has opened or is
maintaining a fraudulent account for a person engaged in identity theft.
N. 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, City personnel will take the following steps to obtain and verify the
identity of the person opening the account:
• Require certain identifying information such as name, residential or
business address, principal place of business for an entity, or other
identification;
CITY OF AUBURN IDENTITY THEFT PREVENTION PROGRAM
Page 4 of 8
• Verify the customer's identity (for instance, review a driver's license, or
other identification card or obtain and review a Real Estate Tax Affidavit
for legitimacy on transfers of ownership where the parties do not elect
Escrow withholding, or require new "release to tenant" forms for all tenant
transfers)
• Review documentation showing the existence of a business entity; and
• Independently contact the customer.
B. Existing Accounts.
In order to detect any of the red flags identified above for an existing account,
City personnel will take the following steps to monitor transactions with an account:
• Verify the identification of customers if they request information (in
person, via telephone, via facsimile, via email);
• Verify the validity of requests to change billing addresses; and
• Verify changes in banking information given for billing and payment
purposes.
V. PREVENTING AND MITIGATING IDENTITY THEFT
In the event City personnel detect any identified red flags, such personnel shall, in
accordance with Departmental policies, take one or more of the following steps,
depending on the degree of risk posed by the red flag:
A. Prevent and Mitigate Identitv Theft.
• Monitor a covered account for evidence of identity theft;
• Contact the customer with the covered account;
• Change any passwords or other security codes and devices that permit
access to a covered account;
• Not open a new covered account;
• Close an existing covered account;
• Reopen a covered account with a new number;
• Not attempt to collect payment on a covered account;
CITY OF AUBURN IDENTITY THEFT PREVENTION PROGRAM
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• Notify the Finance Director for determination of the appropriate step(s) to
take;
• Notify law enforcement; or
• Determine that no response is warranted under the particular
circumstances.
B. Protect Customer ldenti ying Information.
In order to further prevent the likelihood of identity theft occurring with respect to
City accounts, the City shall take the following steps with respect to its internal operating
procedures to protect customer identifying information:
• Secure the City website in accordance with best practices, but provide
clear notice that the website is not completely secure;
• Undertake complete and secure destruction of paper documents and
computer files containing customer information;
• Make office computers password protected and provide that computer
screens lock after a set period of time;
• Keep offices clear of papers containing customer identifying information;
• If social security numbers are used as identifiers, request only the last 4
digits of the number;
• Maintain up to date computer virus protection; and
• Require and keep only the kinds of customer information that are
necessary for City purposes.
VI. PROGRAM ADMINISTRATION
A. Oversi2ht.
The Finance Director or other designated city employee at the level of senior
management shall be responsible for developing, implementing, and updating the
Program.
The Finance Director shall also be responsible for the Program administration, for
appropriate training of City staff on the Program, for reviewing the annual staff report
required under the Program, as well as any other staff reports regarding the detection of
red flags and the steps for preventing and mitigating identity theft, determining which
steps of prevention and mitigation should be taken in particular circumstances, and
considering periodic changes to the Program.
CITY OF AUBURN IDENTITY THEFT PREVENTION PROGRAM
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B. Staff Traininp, and Reports.
City staff responsible for implementing the Program shall be trained either by or
under the direction of the Finance Director in the detection of red flags, and the
responsive steps to be taken when a red flag is detected. Additionally, each affected
Department shall provide an annual compliance report to the Finance Director. The
annual compliance report shall at a minimum address the following:
1. The effectiveness of the City's policies and procedures in addressing the
risk of identity theft in connection with the opening of covered accounts
and with respect to existing covered accounts;
2. Service provider arrangements;
3. Significant incidents involving identity theft and the City's response; and
4. Recommendations for material changes to the Program.
C. Service Provider Arran e~ments.
In the event the City engages a service provider to perform an activity in
connection with one or more covered accounts, the City shall take the following steps to
require, by contract, that the service provider performs its activity in accordance with
reasonable policies and procedures designed to detect, prevent, and mitigate the risk of
identity theft.
• Require the service providers to acknowledge receipt and review of the
Program and agree to perform their activities with respect to City covered
accounts in compliance with the terms and conditions of the Program and
with all instructions and directives issued by the Finance Director relative
to the Program; or
• Require the service providers to acknowledge receipt and review of the
Program and agree to perform their activities with respect to City covered
accounts in compliance with the terms and conditions of the service
provider's identity theft prevention program and to take appropriate action
to prevent and mitigate identity theft; and to report promptly to the City in
writing if the service provider, in connection with a City covered account,
detects an incident of actual or attempted identity theft or is unable to
resolve one or more red flags that the service provider detects in
connection with a covered account.
D. Customer ldentifying Information and Public Disclosure.
The identifying information of City customers with covered accounts shall be
kept confidential and shall be exempt from public disclosure to the maximum extent
CITY OF AUBURN IDENTITY THEFT PREVENTION PROGRAM
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authorized by law, including RCW 42.56.230(4). The City Council also finds and
determines that public disclosure of the City's specific practices to identity, detect,
prevent, and mitigate identify theft may compromise the effectiveness of such practices
and hereby direct that, under the Program, knowledge of such specific practices shall be
limited to the Finance Director and those City employees and service providers who need
to be aware of such practices for the purpose of preventing identity theft.
VII. PROGRAM UPDATES
The Program will be periodically reviewed and updated to reflect changes in risks
to customers and to the safety and soundness of the City from identity theft. The Finance
Director shall, at least annually, review the annual compliance report and consider the
City's experiences with identity theft, changes in identity theft methods, changes in
identity theft detection and prevention methods, changes in types of accounts the City
maintains and changes in the City's business arrangements with other entities and service
providers. After considering these factors, the Finance Director shall determine whether
changes to the Program, including the listing of red flags, are warranted. If warranted,
the Finance Director shall present the recommended changes to the City Council for
review and approval.
CITY OF AUBURN IDENTITY THEFT PREVENTION PROGRAM
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