The Federal Trade Commission (FTC) established the Red Flag Rules recently to help combat the nation’s fastest growing white collar crime—identity theft. Identity thieves can use stolen personal information to obtain fraudulent credit lines and buy or finance vehicles through indirect or direct lending channels. This means the automotive finance community has to be extremely vigilant when it comes to detecting credit fraud. The Red Flag Rules are aimed at helping dealerships and lenders detect identity theft by requiring that both establish prevention programs.

While dealers and lenders have until Nov. 1, 2008 to implement observable and measurable programs, it can be difficult and time-consuming to make sure an organization is meeting Red Flag requirements. This is particularly true for smaller lending institutions and independent auto dealerships that have limited technological and staffing resources. AppOne helps simplify many aspects of Red Flag Rule compliance by employing a number of warranted identity theft prevention processes, including:

IDOne – A proprietary alerting system that automates the process of fraud alerts, addresses discrepancies and also includes proprietary alert rules that look for patterns for possible fraud and identity theft

AuditOne – An AppOne process that reconciles all finance-related documents, including identity documents with information provided on customer credit applications

InterviewOne – A preventative measure used to verify both the identity of the buyer and the type of vehicle that the customer has purchased

“When it comes to the new Red Flag Rules, lenders and dealers can face steep penalties—in some cases, thousands of dollars per violation—for non-compliance,” said Lee Domingue, CEO of AppOne. “AppOne helps address Red Flag Rules before the loan documentation is sent to the lender, which simplifies the compliance process for both the lender and the dealer.” Domingue also added that dealers benefit from selecting a strong industry partner whose policies fit with their established identity theft programs.

Auto dealers are invited to learn more about implementing an identity theft program at their dealership through Wolters Kluwer Financial Services’ educational webinar, “Implementing the Identify Theft Red Flag Guidelines.” For schedule and registration information, please visit www.WoltersKluwerFS.com.

To read more articles related to compliance in the indirect lending industry, log on to the Wolters Kluwer Financial Services’ Compliance Headquarters Web site at http://www.complianceheadquarters.com/.

Dealers and lenders can learn more about the Red Flag Rules by visiting the FTC’s Web site at www.ftc.gov.

About AppOne

Based in Baton Rouge, La., AppOne, a part of Wolters Kluwer Financial Services, is an Internet-based company offering a technology solution that connects independent auto dealers with lenders. The AppOne system relies on the company’s proprietary scorecard system, which evaluates each independent dealer to determine the level of risk associated with doing business with that dealer. It also automates the funding process for dealers by printing all documents required to complete the booking of auto loans. AppOne provides lenders with a new channel of growth and field representation directly to independent auto dealers nationwide. It offers dealers faster financing options for their customers, support services and additional aftermarket fee-based products. For more information on AppOne, visit www.appone.net.

About Wolters Kluwer Financial Services

Wolters Kluwer Financial Services provides best-in-class compliance, content, and technology solutions and services that help financial organizations manage risk and improve efficiency and effectiveness across their enterprise. The organization’s prominent brands include Bankers Systems, VMP® Mortgage Solutions, PCi, GulfPak, Desert Document Services, AppOne®, GainsKeeper®, CCH® Capital Changes, NILS INSource®, AuthenticWeb™ and CCH Wall Street®.

Wolters Kluwer Financial Services’ solutions include integrated and stand-alone compliance and work flow tools, documentation, analytics, authoritative information, and professional services. Customers include banks, credit unions, mortgage lenders, and securities and insurance organizations of all sizes throughout the United States. For more information on Wolters Kluwer Financial Services, visit www.WoltersKluwerFS.com.

Wolters Kluwer is a leading global information services and publishing company. The company provides products and services for professionals in the health, tax, accounting, corporate, financial services, legal and regulatory sectors. Wolters Kluwer has annual revenues (2006) of € 3.4 billion ($4.3 billion), employs approximately 18,450 people worldwide, and maintains operations across Europe, North America, and Asia Pacific. Wolters Kluwer is headquartered in Amsterdam, the Netherlands. Its shares are quoted on the Euronext Amsterdam (WKL) and are included in the AEX and Euronext 100 indices