Loading...
ORD 906 07/14/2009 ORDINANCE NO. 906 AN ORDINANCE BY THE CITY COUNCIL OF THE CITY OF CIBOLO, GUADALUPE COUNTY, TEXAS, PROVIDING FOR THE ESTABLISHMENT OF AN IDENTITY THEFT PREVENTION PROGRAM, TO SET OUT DEFINITIONS, POLICIES AND PROCEDURES FOR IMPLEMENTATION OF THE IDENTITY THEFT PREVENTION PROGRAM; TO PROVIDE A REPEALING CLAUSE, TO PROVIDE A SAVINGS AND SEVERABILITY CLAUSE AND PROVIDING FOR AN EFFECTIVE DATE. WHEREAS, Federal Trade Commission adopted rules pertaining to an Identity Theft Prevention pursuant to the Red Flags Rule which implements Section 114 of the Fair and Accurate Credit Transactions Act of 2003 which requires that creditors adopt an Identity Theft Prevention Program on or before August 1, 2009; and WHEREAS, the Red Flags Rule defines creditor to include all utility companies and the City owns and provides utility services and/or accepts payments for municipal utility services and is therefore classified as a creditor; and WHEREAS, the City Council has requested that City Manager develop such Identity Theft Prevention Program and such personnel recommend the Identity Theft Prevention Program attached hereto and incorporated herein as Exhibit"A" ("Program"); and WHEREAS, the City Council has reviewed the Program and believes it fulfills, complies and implements the Red Flags Rule and other requirements outlined by the Federal Trade Commission; and WHEREAS, the City Council finds that it is in the public interest to approve the Program. BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF CIBOLO, TEXAS,THAT: Section 1. Findings. The foregoing recitals are hereby found to be true and correct and are hereby adopted by the City Council and made a part hereof for all purposes as findings of fact. Section 2. Amendment. The Code of Ordinances are hereby amended, by adding a new Article , entitled Identity Theft Prevention Program, as is more particularly set out in Exhibit A. Section 3. Implementation. All procedures and requirements of The Identity Theft Prevention Program shall be implemented as outlined in the Exhibit A. CITY OF CIBOLO, TEXAS Identity Theft Prevention Program Effective beginning July 14, 2009 I. PROGRAM ADOPTION The City of Cibolo, Texas ("City") developed this Identity Theft Prevention Program ("Program") pursuant to the Federal Trade Commission's Red Flags Rule ("Rule"), which implements Section 114 of the Fair and Accurate Credit Transactions Act of 2003. 16 C. F. R. § 681.2. This Program was developed for the Utility Department of the City ("Utility") with oversight and approval of the City Council. After consideration of the size and complexity of the Utility's operations and account systems, and the nature and scope of the Utility's activities, the City Council determined that this Program was appropriate for the City's Utility, and therefore approved this Program on July 14, 2009. II. PURPOSE AND DEFINITIONS A. Establish an Identity Theft Prevention Program To establish an Identity Theft Prevention Program designed to detect, prevent and mitigate identity theft in connection with the opening of a covered account or an existing covered account and to provide for continued administration of the Program in compliance with Part 681 of Title 16 of the Code of Federal Regulations implementing Sections 114 and 315 of the Fair and Accurate Credit Transactions Act(FACTA) of 2003. B. Establishing and Fulfilling Requirements of the Red Flags Rule The Red Flags Rule ("-Rule") defines "Identity Theft" as "fraud committed using-the identifying information of another person" and a "Red Flag" ("Red Flag") as a pattern, practice, or specific activity that indicates the possible existence of Identity Theft. Under the Rule, every financial institution and creditor is required to establish an "Identity Theft Prevention Program" tailored to its size, complexity and the nature of its operation. The Program must contain reasonable policies and procedures to: 1. Identify relevant Red Flags for new and existing covered accounts and incorporate those Red Flags into the Program; 2. Detect Red Flags that have been incorporated into the Program; 3. Respond appropriately to any Red Flags that are detected to prevent and mitigate Identity Theft; and 4. Ensure the Program is updated periodically, to reflect changes in risks to customers or to the safety and soundness of the creditor from Identity Theft. C. Red Flags Rule Definitions Used in This Program City: The City of Cibolo, Texas. Covered Account: Under the Rule, a"covered account" is: 1. Any account the Utility offers or maintains primarily for personal, family or household purposes, that involves multiple payments or transactions; and 2. Any other account the Utility offers or maintains for which there is a reasonably foreseeable risk to customers or to the safety and soundness of the Utility from Identity Theft. Creditors: The Rule defines creditors "to include finance companies, automobile dealers, mortgage brokers, utility companies, and telecommunications companies. Where non-profit and government entities defer payment for goods or services, they, too, are to be considered creditors." Identifying Information is defined under the Rule as "any name or number that may be used, alone or in conjunction with any other information, to identify a specific person," including: name, address, telephone number, social security number, date of birth, government issued driver's license or identification number, alien registration number, government passport number, employer or taxpayer identification number, unique electronic identification number, computer's Internet Protocol address, or routing code. Program: The Identity Theft Prevention Program for the City. Program Administrator: The City Manager is the Program Administrator for the Program. Utility: The Utility is the Utility Department for the City. III. IDENTIFICATION OF RED FLAGS. In order to identify relevant Red Flags, the Utility considers the types of accounts that it offers and maintains, the methods it provides to open its accounts, the methods it provides to access its accounts, and its previous experiences with Identity Theft. The Utility identifies the following red flags, in each of the listed categories: A. Suspicious Documents 1. Identification document or card that appears to be forged, altered or inauthentic; 2. Identification document or card on which a person's photograph or physical description is not consistent with the person presenting the document; 3. Other document with information that is not consistent with existing customer information(such as if a person's signature on a check appears forged); and 4. Application for service that appears to have been altered or forged. B. Suspicious Personal Identifying Information 1. Identifying information presented that is inconsistent with other information the customer provides; 2. Identifying information presented that is the same as information shown on other applications that were found to be fraudulent; 3. A person fails to provide complete personal identifying information on an application when reminded to do so (however, by law social security numbers must not be required) or an applicant cannot provide information requested beyond what could commonly be found in a purse or wallet; and 4. A person's identifying information is not consistent with the information that is on file for the customer. C. Alerts from Others Notice to the Utility from a customer, identity theft victim, fraud detection service, law enforcement or other person that it has opened or is maintaining a fraudulent account for a person engaged in Identity Theft. IV. DETECTING RED FLAGS. A. New Accounts In order to detect any of the Red Flags identified above associated with the opening of a new account, Utility personnel will take the following steps to obtain and verify the identity of the person opening the account: Require certain identifying information such as name, residential or business address, driver's license or other identification. B. Existing Accounts In order to detect any of the Red Flags identified above for an existing account, Utility personnel will-take-the-following steps to monitor transactions with-an-account: - - Verify changes in banking information given for billing and payment purposes. V. PREVENTING AND MITIGATING IDENTITY THEFT In the event Utility personnel detect any identified Red Flags, such personnel shall take one or more of the following steps, depending on the degree of risk posed by the Red Flag: I. Contact the customer, sometimes through multiple methods; 2. Not open a new account; 3. Close an existing account; 4. Notify law enforcement; or 5. Determine that no response is warranted under the particular circumstances. In order to further prevent the likelihood of identity theft occurring with respect to Utility accounts,the Utility will take the following steps with respect to its internal operating procedures to protect customer identifying information: 1. Ensure that its website is secure or provide clear notice that the website is not secure; 2. Where and when allowed, ensure complete and secure destruction of paper documents and computer files containing customer information; 3. Ensure that office computers are password protected; 4. Change passwords on office computers on a regular basis; 5. Ensure all computers are backed up properly and any backup information is secured; 6. Ensure computer virus protection is up to date; and 7. Require and keep only the kinds of customer information that are necessary for utility purposes. VI. PROGRAM UPDATES This Program will be periodically reviewed and updated to reflect changes in risks to customers and the soundness of the Utility from Identity Theft. At least annually, the Program Administrator will consider the Utility's experiences with Identity Theft situation, and changes in Identity Theft methods, consult with law enforcement authorities, and consult with other City personnel. After considering these factors, the Program Administrator will determine whether changes to the Program are warranted. If warranted, the Program Administrator will update the Program or present the City Council with his or her recommended changes and the City Council will make a determination of whether to accept, modify or reject those changes to the Program. VII. PROGRAM ADMINISTRATION A. Oversight Responsibility for developing, implementing and updating this Program lies with the Program Administrator. The Program Administrator will be responsible for the Program administration, for ensuring appropriate training of Utility staff on the Program, for reviewing any staff reports regarding the detection of Red Flags and the steps for preventing and mitigating Identity Theft, determining which-steps of-prevention and mitigation-should-be taken-in particular circumstances - - - and considering periodic changes to the Program. B. Staff Training Initially, all Utility staff shall be trained either by or under the direction of the Program Administrator in the detection of Red Flags, and the responsive steps to be taken when a Red Flag is detected. Thereafter, all Utility staff shall undergo update training not less than annually. Additionally, all new Utility employees shall undergo training. C. Service Provider Arrangements In the event the Utility engages a service provider to perform an activity in connection with one or more accounts, including but not limited to franchise utility providers, the Utility will take the following steps to ensure the service provider performs its activity in accordance with reasonable policies and procedures designed to detect, prevent, and mitigate the risk of Identity Theft. 1. Require, by contract, that service providers have such policies and procedures in place; and 2. Require, by contract, that service providers review the Utility's Program and report any Red Flags to the Program Administrator. D. Specific Program Elements and Confidentiality For the effectiveness of Identity Theft prevention Programs, the Red Flag Rule envisions a degree of confidentiality regarding the Utility's specific practices relating to Identity Theft detection, prevention and mitigation. Therefore, under this Program, knowledge of such specific practices are to be limited to those employees who need to know them for purposes of preventing Identity Theft. Because this Program is to be adopted by a public body and thus publicly available, it would be counterproductive to list these specific practices here. Therefore, only the Program's general red flag detection, implementation and prevention practices are listed in this document. Section 4. All provisions of the Code of Ordinances of the City of Cibolo, Texas in conflict with the provisions of this Ordinance are hereby repealed to the extent of such conflict, and all other provisions of the Ordinances of the City of Cibolo, Texas not in conflict with the provisions of this Ordinance shall remain in full force and effect. Section 5. Should any sentence, paragraph, subdivision, clause, phrase or section of this Ordinance be adjudged or held to be unconstitutional, illegal or invalid, the same shall not affect the validity of this Ordinance as a whole, or any part or provision thereof other than the part so decided to be invalid, illegal or unconstitutional, and shall not affect the validity of the Code of Ordinances as a whole. Section 6. That this Ordinance shall be effective immediately upon the passage and approval of the City Council of the City of Cibolo, Texas. AND IT IS SO ORDAINED. PASSED AND APPROVED by a vote of (, for to against this 14th day of July, 2009. APPROVED: 1"41,ta-,1-/ Vayor Je• Ha -��an ATTEST: Peggy Cimics, City Secretary