AppOne Details Products Designed to Combat Red Flag Violations
fBATON ROUGE, La. — AppOne, a part of Wolters Kluwer Financial Services, recently offered an overview of its products designed to help dealers with the soon-to-be instituted Identity Theft Red Flags and Notices of Address Discrepancy, more commonly known as "Red Flag Rules," using its Internet-based financial risk mitigation technology.
Providing a bit of background, the company explained that the Federal Trade Commission established the Red Flag Rules to help combat the nation's fastest growing white collar crime — identity theft.
Identity thieves can use stolen personal information to obtain fraudulent credit lines and buy or finance vehicles through indirect or direct lending channels. This means the automobile finance community has to be extremely vigilant when it comes to detecting credit fraud.
The Red Flag Rules are aimed at helping dealerships and lenders detect identity theft by requiring that both establish prevention programs, officials indicated.
While dealers and lenders have until Nov. 1 to implement "observable and measurable" programs, it can be difficult and time-consuming to make sure an organization is meeting Red Flag requirements.
This is particularly true for smaller lending institutions and independent auto dealerships that have limited technological and staffing resources, the company pointed out. AppOne helps simplify many aspects of compliance by employing a number of warranted identity theft prevention processes, including:
IDOne: A proprietary alerting system that automates the process of fraud alerts, addresses discrepancies and also includes proprietary alert rules that look for patterns for possible fraud and identity theft.
AuditOne: An AppOne process that reconciles all finance-related documents, including identity documents with information provided on customer credit applications.
InterviewOne: A preventative measure used to verify both the identity of the buyer and the type of vehicle that the customer has purchased.
"When it comes to the new Red Flag Rules, lenders and dealers can face steep penalties — in some cases, thousands of dollars per violation — for non-compliance," highlighted Lee Domingue, chief executive officer of AppOne.
"AppOne helps address Red Flag Rules before the loan documentation is sent to the lender, which simplifies the compliance process for both the lender and the dealer," he pointed out.
Domingue went on to say that dealers can benefit from selecting a strong industry partner whose policies fit with their established identity theft programs.
To read more articles related to compliance in the indirect lending industry, log on to the Wolters Kluwer Financial Services' Compliance Headquarters Web site at www.complianceheadquarters.com.
Dealers and lenders can also learn more about the Red Flag Rules by visiting the FTC's Web site at www.ftc.gov.