(No Ratings Yet)
Loading ...
What FACTA means is that if you, as an individual, lose the information on anyone you have ever hired; or, for any business in the United States of America that collects any personal information on people, if the information should be lost due to not destroying the information properly, then two things can happen. First, there are federal fines of up to $2,500.00, and state fines up to $1,000, per employee, per incident. Second, the business is liable for any damages the individual suffers as the result of a breach of information.
Take an example that the company loses information due to negligent destruction (i.e. you don’t own a shredder and throw the information into the dumpster). Nothing in FACTA really determines what the employee has to do to prove negligent destruction on the part of the employer, so an employee could simply state that the employer had lost the information, and even if the employer had burned the information into ashes, it would be up to the employer to show that the information had not gotten out due to his or her company’s negligence.
Business Week says that the average damages for Identity Theft victims are $92,000.00 and up per person. Using this statistic, if you have 10 employees lose their identities, then on average, your liability is $920,000.00. Statistically, you are responsible for an average of 75 bad checks and 8 credit cards per employee. The average Identity Theft victim also spends 600 hours getting their credit restored, which means that you will have 600 hours per employee, so potentially 6,000 hours for 10 employees, which you will be responsible for paying employees who aren’t even at work, because they have taken time off to deal with the Identity Theft.
According to John Gardner, co-author of Chicken Soup for the Entrepreneurial Soul, The damages are devastating to any business.
There are many problems related to people’s identities that don’t deal with credit issues. Contrary to popular belief, only 26% of identity theft issues relate to credit issues. The other 74% of the issues, according to Gardner, are related to the following four areas:
Someone stealing your DMV record. Example: An identity thief wants to drive under your employee’s name instead of theirs. This will help the Identity Thief to not get caught in cases of DUI, unpaid speeding tickets, etc. Your employee is then blamed for their driving record.
Someone stealing your MIB record. This is your Medical Information Bureau Record. Example: An Identity Thief wants to have an AIDS test done in your employee’s name, rather than theirs, or have their prescriptions filled using your employee’s Medicaid or Medicare benefits
Someone stealing your character identity to commit a crime in your name. Imagine this your future employee comes to your child care facility, and everything sounds good about this candidate. However, you run a criminal background check, and find out that they have three arrests for child pornography and one for drug trafficking to minors. You bring the record to their attention, and they insist it’s not them.
Your employment record. Example: An Identity Thief wants to earn income using your employee’s social security number, but let your employee pay taxes on the money they earn.
As a result of this, Gardner says that Businesses need to offer 24 hour per day, 7 day per week access to attorneys.I think that the danger is so large to any business, that they may want to [pay for] some of the cost of this, to encourage the employees to get the benefitIf a business does not understand that they need the help, they are living in a dream world.
Employers should also offer some sort of Identity Theft protection, and ongoing background monitoring. This can be offered as a voluntary benefit which has no real cost to the employer, as a fringe benefit paid by the employer, or can be a combination of both. When an identity thief uses your employee’s information, (for example an identity thief takes the employee’s current address, and uses it as their previous address when they apply for a mortgage,) ongoing background monitoring will notify your employee when the identity theft happens.
Most people don’t find out that they have become victims until that Identity Thief, who has used your employee’s credit to finance their mortgage, stops paying bills, is picked up for a crime, or doesn’t pay taxes. Ongoing monitoring provides an early warning system, so that your employee will be able to call an expert who can correct the problem when it takes place. This will save your employee’s time, and limit the losses your employee will incur as a result of the breach of their information. This will also save you the costs associated with the frustration and lack of ability to pay attention as work.
Even if your employees don’t elect to have the benefits of legal services and identity theft protection, having a mandatory meeting where employees hear that you have made this coverage available to them will provide an affirmative defense, should an employee ever accuse you, as the employer, of having lost their personal information.
Under FACTA, access to an attorney and credit restoration, are benefits that employers need to offer. Ongoing background monitoring will mitigate damages that the employee can experience because the early warning system will be in place to handle the issues. Access to an attorney and credit restoration will drastically reduce the time the employee spends away from work dealing with the issues surrounding identity theft and other personal legal problems.
Failure on the part of an employer to offer this benefit leaves a company exposed to thousands (and even millions) of dollars in potential damages, and leaves employees subject to the time, frustration, and headaches associated with being a victim of Identity Theft.
Jonathan Kraft is a benefits consultant who specializes in educating people about how they can get affordable access to the legal system. Because of his work in the field of electronic Identity Theft, he has come to be known as Colorado’s Foremost Expert on Computer Related Identity Theft. To schedule a time for Mr. Kraft’s company to present Identity Theft and Legal Service protection to your employees, please contact him at (877) 825-7119.
No Spam
Adult 
Gambling
Unfinished
Deception
Plagiarism
Not English
As the CEO of an identity theft protection program, I might be expected to be pleased at the horrific threats outlined in this article. I am not, however -- my firm takes a cautious and responsible approach to defining both the threat and the solutions, and I'm concerned about the hype and exaggeration in this article. The numbers in this article are unnecesarily inflated: the real numbers and a careful analysis are scary enough. The average personal loss is NOT $92,000, it's actually about $1500, up from $800 in 2003. The average recovery time has been estimated anywhere from 80 to 600 hours, although this number too is going up. And even these figures are higher than most people experience -- about 1/6 of ID thefts are really serious, causing over $6000 in losses and really terrible recovery experiences, but most are less severe, although still damaging. The real story is that over half of ID thefts are workplace related -- either they occur in the physical workplace, or are thefts of employee data, from the employer or a service provider such as outsourced Payroll, Benefits, Pension Admin, security, facilities, etc. And during 2005, legal changes and new court cases established that employers will be held to a "reasonable safeguards" standard for protecting worker identity data, or face severe fines and civil damages. Most firms have numerous significant holes in their security around worker information. What company doesn't have many Excel spreadsheets floating around with sensitive info, or reports available on the company intranet that could be printed with no trace, or passwords stuck on sticky notes, or terminated employee accounts that remain active for at least a few days -- and many more such gaps? In the current climate, with 10 million ID thefts annually, and deep-pocket employers legally liable in many cases, these exposures can be very costly. My firm estimates that this liability, coupled with worker productivity losses, will lead to average employer costs of about $200 for every employee every year. The Identity Guardian offers the most comprehensive protection available anywhere -- providing prevention, monitoring, insurance, and recovery assistance. We offer this as an employee benefit program, and also offer enterprise training, consulting, and related services. We have a wealth of information at www.idbenefits.com, and from there you may call or email me for further info.