§ 37.27 RED FLAGS.

   (A)   The following red flags are potential indicators of fraud.

   (B)   Any time a red flag, or a situation closely resembling a red flag, is apparent, it should be investigated for verification:

      (1)   Alerts, notifications, or warnings from a consumer reporting agency;

      (2)   A fraud or active duty alert included with a consumer report;

      (3)   A notice of credit freeze from a consumer reporting agency in response to a request for a consumer report; or

      (4)   A notice of address discrepancy from a consumer reporting agency as defined in § 334.82(b) of the Fairness and Accuracy in Credit Transactions Act, being 15 U.S.C. § 1681.

   (C)   Red flags also include consumer reports that indicate a pattern of activity inconsistent with the history and usual pattern of activity of an applicant or customer, such as:

      (1)   A recent and significant increase in the volume of inquiries;

      (2)   An unusual number of recently established credit relationships;

      (3)   A material change in the use of credit, especially with respect to recently established credit relationships; or

      (4)   An account that was closed for cause or identified for abuse of account privileges by a financial institution or creditor.

(Res. 2009-041, passed 11-16-2009)