Quick Answer
A complaint and a detected identity-theft red flag can require different internal responses, so personnel apply the procedure relevant to each. An associated person who learns of a listed event reports its existence to the member promptly. A red-flag response must fit the risk, and the firm may decide that no response is warranted.
An escalation method routes a recognized complaint, a potential red flag, or both, so the firm can apply the right response to each issue. Personnel use the firm’s applicable escalation method for the issue. Complaints and detected identity-theft red flags can require different internal responses.
Which Escalation Method Applies?
- An associated person who learns of a listed event promptly reports its existence to the member.
- The firm handles a detected identity-theft red flag under its written prevention program. The response must fit the risk under the circumstances.
- The firm may determine that no response is warranted under the particular circumstances.
- When one matter includes both a complaint and a detected red flag, personnel apply the firm’s procedure that is relevant to each issue.
Exam Tip: Gotchas
- The applicable procedure depends on the issue. A complaint and a detected identity-theft red flag can require different internal responses.
- A detected red flag does not require one fixed response. The firm selects a response that fits the risk and may determine that no response is warranted.
What Should You Check on Exam Day?
- Use the firm’s applicable procedure for each complaint or detected red flag.
- Match a detected-red-flag response to the risk and circumstances.