Liability both civil and criminally! A security breach will eventually happen. Your employees assume they can “TRUST” you with their personal information. Experts estimate that more than half of identity thefts are inside jobs, putting business owners at serious financial risk along with employees’ jobs and personal privacy and security.

The newest trend in identity theft is to hit groups of people, and workplaces can be vulnerable. Sadly, the number one source of identity theft is employer records. The payoff for such theft can be huge. Instead of a single wallet with a single social security number, theft of employee or customer files can yield hundreds of names and numbers.

Times have CHANGED. News reports of identity thefts dominate daily headlines. A small business owner might think my operation is too small to worry about the theft of employee and customer files. Think again, with larger corporations increasing there security due to recent employee and customer files losses now smaller companies are looking very inviting.

Private information your company may have on file could be employee’s names, addresses, account numbers, medical information, driver license information, social security numbers and the list goes on. All of this information is very lucrative for identity thieves.

The Cost to Businesses due to Identity Theft can be substantial. Employees can take up to 600 hours, mainly during business hours, to restore their identities. “If you experience a security breach, 20 percent of you affected customer base will no longer do business with you, 40 percent will consider ending the relationship and 5 percent will be hiring lawyers!

When it comes to cleaning up this mess, companies on average spend 1,600 work hours per incident at a cost of $40,000 to $92,000 per victim.*” (*CIO Magazine, The Coming Pandemic, Michael Freidenberg, May 15th, 2006) Federal and State fines and penalties are just as bad ranging from $1000 to $1,000,000 per occurrence with up to ten years jail time for executives.

How long before we see class action law suite advertisements on television, like we have for asbestos and tobacco. With Law Firms advertising on their web sites such as “Do you suspect that a corporation has released your private information (through an accident or otherwise)? If you are one of many thousands whose confidential information was compromised, you may have a viable class action case against that company.

” We will probably see law firms start this around the first of the year. Why not, civil lawsuits are being filed and won by identity theft victims whose personal information was compromised. Businesses of all types have been charged with negligence for not performing reasonable due diligence to protect their employees’ sensitive data from theft.

EXAMPLE: The Michigan Court of Appeals recently opened the opportunity for identity theft lawsuits to be pursued as negligence claims. In February 2005 in Bell et al. vs. Michigan Council of AFSCME et al., the Detroit court upheld a jury award of $275,000 each (totaling $3.5 million), finding that the defendants owed the thirteen plaintiffs a duty when the defendants failed to safeguard personal information and their negligence facilitated identity theft perpetrated by a third party. This ruling establishes the courts position about the importance of proper procedures and safeguards to ensure that confidential information is not accessed by unauthorized persons.

Small business owners are feeling the pressure. In an article in the ABA Journal (March 2006 – “Stolen Lives”) According to Betsy Broder of the FTC, “. . . all businesses should look to that law for guidance on how to protect consumer data. At a basic level, she says, that means businesses need to have a plan in writing describing how customer data is to be secured and an officer on staff responsible for implementing that plan.

Many large businesses entrust such planning and execution to a chief technical officer or chief privacy officer. Broder says she understands that most small businesses cannot be expected to hire a full-time privacy specialist, but she adds that all businesses must be able to show they have a security plan in place. ‘We’re not looking for a perfect system,’ Broder says.

‘But we need to see that you’ve taken reasonable steps to protect your customers’ information. We will act against businesses that fail to protect their data … We’re not looking for the perfect system. But we need to see that you’ve taken reasonable steps to protect your customer’s information”.

What’s a small business owner to do? Business and Legal Reports, January 19, 2006 states “One solution that provides an affirmative defense against potential fines, fees, and lawsuits is to offer some sort of identity theft protection as an employee benefit. An employer can choose whether or not to pay for this benefit.

The key is to make the protection available, and have a mandatory employee meeting on identity theft and the protection you are making available, similar to what most employers do for health insurance.” By offering employees recovery assistance, companies hope to head off possible lawsuits, experts say.

Minimizing your company’s exposure is an important part of due diligence. It's well worth the time to spend getting prepared for a data security breach than to be caught off guard.

By offering Full Restoration Identity Theft Protection Plan that covers all five common types of Identity Theft (financial identity theft, drivers license identity theft, social security identity theft, medical identity theft and criminal identity theft) as an employee benefit you may reduce company losses. By offering a full restoration identity theft protection plan means the majority of the time in restoring an employee’s identity is covered by the protection plan and not done on company time and/or company expense.

Also, use of a life events legal events plan provides help that addresses 100% of the problem. An identity theft protection plan could also act as a potential early warning system to your company. If a number of your employees get notified of improper usage of their identities, your company could have a possible internal breach.

Affirmative Defense Response System is a proactive plan to protect sensitive employee information and is critical to building an affirmative legal defense in the event of a lawsuit. We provide documentation for appointment of a security compliance officer, mandatory meeting on identity theft for employees, Sensitive and Non Public Information Policy and to potentially protect yourself, you could have all employees sign a use of confidential information by employee document.

This makes employees aware of their legal responsibilities to protect non public information. It serves as proof that handlers of non public information have been through mandatory training required by law. With the use of an opt in, opt out form for identity theft protection plan and life events legal events plan your company has an affirmative legal defense in the event of a lawsuit due to loss employee data at no cost to the employer when offered as an employee paid benefit.

Affirmative Defense Response System**, Life Events Legal Events Plan** are products of Pre-Paid Legal Services, Inc. The Identity Theft SHIELD** is administered by Kroll Background America and is marketed by Pre-Paid Legal Services, Inc. (**Subject To Terms and Conditions) “It's well worth the time to spend getting prepared for a data security breach than to be caught off guard.”

Courtesy Of:
Thomas Caponetto
Certified Identity Theft
Risk Management Specialist,
816-806-0041
bizhelp4u@sbcglobal.net
www.biz-help4u.com

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