In accordance with a request from Congress, the FTC has delayed enforcement of the Red Flags Rule until December 31, 2010. This enforcement extension is necessary in order for lawmakers to finalize the scope of those impacted by the Rule. Should legislation determining the scope of affected entities be passed before the new deadline, the Rules will go into immediate effect.
The Red Flags Rule was created as a means to recognize, prevent and manage identity theft and is applied to businesses where the issue needs to be addressed. The development and implementation of these programs is the responsibility of financial institutions and creditors per the Rule.
Since its introduction in 2008, the Rule has seen various changes in scope: to whom it will be applied. Legislation and court mandates have set back the enforcement of the Rule since its establishment.
For more information, please go to www.complianceweek.com/blog/aguilar/2010/06/01/once-again-ftc-delays-red-flags-enforcement.