07/ 25/ 2006
by Beth Gaudio
It's not uncommon for businesses to request personal information from employees and customers, but if this information falls into the wrong hands, it could put individuals at risk for identity theft and spell disaster for your business. In fact, theft of records from employers or other businesses has become the top cause of identity fraud, according to TransUnion, a leading credit information provider. Theft from business tops other sources, including stolen credit cards and mail theft.
Employment records, such as job applications and payroll records, contain Social Security numbers, birth dates and home addresses—making the records a ripe source for theft. Thieves use information from these records to open credit cards, buy cars and rent apartments. According to the Federal Trade Commission, 90 percent of business-record thefts involve payroll or employment records.
Faced with the threat of negligence lawsuits from workers who've been victims of identity theft, businesses are reviewing how they handle personal information. To improve your business' identity safety, consider the following:
Guard closely. Keep employment records and all personal customer information in a secure location and guard it closely. Share personal information on a limited and need-to-know basis. Carefully screen employees who have access to material containing personal information.
Proper disposal. Shred all documents that contain personal information. In many small businesses, employees are reimbursed after using personal credit cards or checks to make purchases. These receipts may not be properly discarded and often contain personal information. To ensure information is destroyed, place shredders around the office.
Basic training. Train employees about identity theft and how to properly handle and dispose of documents containing personal information.
Wrong number. Limit or eliminate the use of Social Security numbers as identification numbers. Instead, use an alternate number on employee documents and health-insurance information.
Come clean.If a database containing secure personal information is compromised, notify all affected individuals in a timely manner so they can protect themselves.
Beth Gaudio is a staff attorney with the NFIB Legal Foundation. This article is intended to provide general information for reference only and should not be considered legal advice.
