ID Theft Red Flags FAQ IIB5 – Is a certificate of deposit a “covered account?”

Compliance > Lending > FCRA
Q:  Is a certificate of deposit a “covered account?”
 
A:  A certificate of deposit is an “account” because it involves a continuing relationship established by a person with a financial institution or creditor to obtain a product or service for personal, family, household, or business purposes. Whether a certificate of deposit is a “covered account” will depend on its features and risks. For example, a certificate of deposit purchased by a consumer that does not involve, and is not designed to permit, multiple payments or transactions, is not covered under the first part of the definition of a “covered account” (set out above under II.B.1). Therefore, the financial institution must determine for itself whether the certificate of deposit presents a reasonably foreseeable risk of identity theft under the second part of the definition of a “covered account.”
 
 
ADDITIONAL INFORMATION:
This information was obtained from the Interagency FAQs for Identity Theft Red Flags and Address Discrepancies - https://www.federalreserve.gov/newsevents/pressreleases/files/bcreg20090611a1.pdf
 

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