Posts Tagged ‘Red flags’

Red Flags Rule Now In Effect

Thursday, January 13th, 2011

  After two years of confusion as to what businesses must comply and delays in enforcement the Red Flags Rules are now in effect, with the Federal Trade Commission (FTC) gearing up enforcement activity.  The Red Flags Program Clarification Act of 2010, signed into law on December 18, 2010, confirms that certain businesses are not within the scope of the Rules.  Attorneys, accountants, physicians, dentists and other healthcare professionals, and many other small businesses are no longer subject to enforcement actions.  Dealerships  however fall under the definition of a creditor if  they ” regularly and in the ordinary course of business: (i) obtains or uses consumer reports, directly or indirectly, in connection with a credit transaction; (ii) furnishes information to consumer reporting agencies in connection with a credit transaction; or (iii) advances funds to or on behalf of a person, based on an obligation of the person to repay the funds or repayable from specific property pledged by or on behalf of the person; however, a creditor that falls under (iii) is excluded from the requirements of the Red Flags Rules if the creditor advances funds for expenses incidental to a service provided by the creditor to the person”.

 More information on the Red Flags Rules can be found at   KPA offers a free white paper on compliance with the Red Flags Rules and HotlinkHR clients have access to a complete compliance program for Red Flags Rules and Customer Information Security included within their subscription.

Red Flags Enforcement -False Start (Yet Again)

Friday, May 28th, 2010

Will the FTC ever enforce the Red Flags rule? A better question is why have a rule if there is no enforcement? In the ongoing saga of will they-won’t they-  enforce the rule the answer is not today, not tomorrow and not until January 1, 2011 (maybe).

On May 28, 2010, the Federal Trade Commission (FTC) announced that it would suspend enforcement of the Identity Theft Red Flags Rule until January 1, 2011. The Red Flags Rule was originally set to take effect on November 1, 2008, but implementation has been delayed multiple times. The substance of the Red Flag Rule will not be changed during the delay.

You can find more information about the FTC’s decision to delay implementation of the Red Flags Rule at:

Join the conversation: After multiple delays are you enforcing Red Flags internally or just waiting to see what happens?

FTC To Begin Red Flags Rule Enforcement June 1, 2010

Wednesday, May 19th, 2010

No more extensions-the FTC will begin enforcement of the Red Flags Rule on June 1, 2010.   Since the rule was to go into effect November 2008, and then the FTC delayed  enforcement in May 2009, November 2009 and June 2010, everyone should have a plan in place already; but for  those of you who have take procrastination to a new level here are some resources to ensure you are ready by the June 1 date.   

The FTC website provides how to guides, FAQ and templates and forms at .

Review Red Flag Rule for Dealership, a KPA whitepaper at

Join the conversation: is your Red Flags program in place?