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Noteworthy: Identity Theft & Visa
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Noteworthy: Identity Theft & Visa
Posted: Apr 24 2003
A publication of Lyon, Popanz & Forester
The Problem
- Nine out of 10 Americans (92 percent) think it is important that the government take action on the issue of identity theft, the nation's fastest growing crime.
- Close to 51 percent of Americans are more concerned about identity theft than unemployment.
“The survey, conducted for STAR in April 2003, gives the latest picture on the threat of identity theft to American consumers, businesses and financial institutions. In the survey, 5.6 percent of the respondents replied “yes” when asked whether they had “ever been the victim of identity theft. …”
- According to Visa research, 68 percent of identity theft victims say the biggest problem they face is the time it takes to remedy the situation.
The Solution
“Visa USA today (April 22) announced a national initiative to assist identity theft victims in recovering from the aftermath of the crime. Victims often cite efforts such as correcting inaccurate credit reports, requesting a new Social Security number and closing card account numbers as time consuming. …
“Through a unique partnership with Call For Action, a consumer network based in Maryland, victims of identity theft can receive free, confidential counseling by calling 1-866-ID-HOTLINE. Call For Action's consumer hotline offers the assistance of trained professionals to walk consumers step-by-step through the process of getting their identities back, including providing important phone numbers for law enforcement and credit bureaus that need to be notified.
“Visa also announced today that it is offering Personal Identity Theft Coverage as a new optional benefit for Visa cardholders. Member financial institutions will have the opportunity to purchase this coverage to offer free to their cardholders. The insurance coverage goes beyond Visa's zero liability policy by providing eligible cardholders with coverage ranging from $1,000 to $15,000 in reimbursement for lost wages, legal fees and other costs associated with recovering from identity theft.”
Noteworthy
Almost all corporations that have identity information from their customers store it in computer systems. They take multiple steps to protect that information. But computer systems and networks are vulnerable to human errors, technical failures, design oversights, etc. Visa has taken a creative step to minimize the damage if – or should we say when – a customer is harmed through release of their identity information. That’s great for customers of Visa. But what is your company doing for your customers?
Effective risk management starts with a thorough identification of risk and steps to minimize the probability that those risks will occur. It ends with steps to minimize the impact if a risk occurs despite your best efforts. Visa’s new program is an excellent example of minimizing the impact. What do you now expect of the bank that issues your credit card?
What is your company doing to protect your customers if – or should we say when – their data falls into the wrong hands and their identity is stolen? What should your customers now expect of your company? Are you minimizing the risk that information entrusted to you will be released and minimizing the impact on your customers if it is?
Solving the problems of identity theft requires technical solutions and creative management to protect the best interests of the company and its customers. We may be able to help.
April 20, 2003
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Links:
Star survey: www.star.com
Star white papers: www.star-systems.com
Visa announcement: www.usa.visa.com
Call For Acton: www.callforaction.org
Noteworthy is an occasional publication of Lyon, Popanz & Forester. Please feel free to pass it on to others who may find it of interest. Copyright 2003. Edited by Hal Amens hal@lpf.com Information in Noteworthy is based on our experience as management consultants and sources we consider reliable. There are no further warranties about accuracy or applicability. It contains neither legal nor financial advice. For that, consult appropriate professionals. Lyon, Popanz k Forester is a management consulting firm that designs and manages projects that solve management problems. We welcome your comments about the content of this issue. To comment: Comment on Noteworthy
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