Leave it to government to add even more administrative burdens to the practice of law. On May 1, the Federal Trade Commission will begin enforcement of the “red flags rule” The rule is part of the Fair and Accurate Credit Transactions Act of 2003 (FACTA), legislation in response to the rise in identity theft. Because more than half of identity thefts occur in the workplace, businesses are going to now be required to implement certain safeguards.
Under the new rule, lawyers must implement a written policy specifying how they will watch for the warning signs -- the “red flags” -- that indicate an identity theft may be occurring and how they will respond to prevent or mitigate the crime if uncovered. The extent of the written policy depends on entirely on the type of practice and the FTC concedes that there is no bright-line rule. For a good overview written by Susan D. Oja and Alex De Grand of the State Bar of Wisconsin, follow this link.
This new "rule" should go along quite nicely with the changes to the Illinois Notary Public Act that becomes effective June 1, 2009. The changes are part of a four year pilot program designed to reduce real estate fraud in Cook County. The big changes for those of us who are notaries and practice in Cook County is we have to create and keep a Notarial Record, which requires us to take down certain identifying information, the funnest of which will be a person's right (not left) thumbprint, if they are transferring real property in Cook County. The good news is we can now charge up to $25.00 for each notarization.
For an overview of the Act's other changes as complied by the National Notary Association click here.
As an aside, for my practice I plan to start doing cheek swabs to have my client's DNA, to ensure compliance with the new laws. I will keep the package of swabs right next to my ink pad for the fingerprints.