“Red Flags Rule” won’t take affect until May, FTC says
The deadline to meet the “Red Flags Rule” requirements, which will affect powersports dealerships, has been extended until May 1, the Federal Trade Commission (FTC) announced.
The extension is expected to allow companies additional time to develop and implement written identify theft prevention programs.
The upcoming rule requires financial institutions and creditors to have programs to identify, detect and respond to patterns, practices or specific activities that could indicate identity theft.
According to the FTC, a creditor is defined as any entity that regularly extends, renews or continues credit; any entity that regularly arranges for the extension, renewal or continuation of credit; or any assignee of an original creditor who is involved in the decision to extend, renew or continue credit.
The FTC has published an alert on what the rule requires. It’s available at http://www.ftc.gov/bcp/edu/pubs/business/alerts/alt050.shtm.
