The FTC announced today it will not begin enforcing the Red Flag Rules on August 1, as previously announced. This time they’ve extended creditors’ compliance deadline to November 1.
If you’ve ever seen the 1993 movie “Groundhog Day”, you have a glimpse of what it’s like to write about the Federal Trade Commission’s enforcement of the Red Flag Rules.
In the movie, bitter TV weatherman Bill Murray is forced to cover the same Groundhog Day events he’s covered several years running, but he wakes the next day to experience the same series of events, day after day. All the other characters say and do the same things, day after day.
Earlier deadlines were November 1, 2008 and May 1, 2009.
Again this time, the FTC cites continued confusion about their definition of creditor and what creditors need to do to comply with Red Flag Rules. And, again this time, the FTC promises to “redouble its efforts to educate them about compliance”.
The Rules are intended to protect consumers from identity theft by familiarizing businesses and financial institutions with the warning signs of ID theft, and requiring that they establish procedures for responding to possible incidents of identity theft.
The FTC’s Red Flag Web site at www.ftc.gov/redflagsrule, provides resources to help businesses determine whether they fall within the definition of “creditor,” and provides templates for designing compliance programs.
The FTC and other financial regulatory agencies established the Rules as part of the Fair and Accurate Credit Transactions Act of 2003.
