It is both the law and a professional responsibility for REALTORS® to protect their customers from identity theft. In New Jersey, all real estate professionals must adhere to the New Jersey Identity Theft Prevention Act, which requires businesses to safeguard personal information and to notify customers if their information is stolen. The Act also prohibits REALTORS® from printing anyone’s Social Security number on mailed materials or displaying it in any way.
In addition to the NJITPA, there are many federal laws that require professionals to safeguard consumer information. These laws provide civil remedies for violations of the law including the payment of fines, penalties, attorneys’ fees, and cost of actual damages, imprisonment and class action suits.
In 2009, the FTC launched a new webpage — Fighting Fraud with the Red Flags Rule: A Guide for Business — designed to help creditors and financial institutions comply with “red flag” rules designed to identify and prevent identity theft. The website describes all of the entities currently covered and how to comply with its provisions.
Mortgage brokers and mortgage lenders that provide credit, or arrange for credit to be provided, are required to establish policies and procedures to prevent identity theft. A real estate agent may be considered a “creditor” if s/he regularly arranges for credit to be extended, e.g. regularly pulls credit reports, suggests potential lenders or helps with the loan applications.
NAR has compiled FAQs on this issue for further guidance.
