Recently revised in May of this year, the Federal Trade Commission (FTC) adjusted its standards for safeguarding customers’ information. The newly updated Safeguards Rule reminds not only financial institutions, but organizations and businesses that regularly exchange sensitive customer information with them to take a look at their current business security practices as well.
If you are wondering whether or not your organization falls under the classification, the FTC’s guide specifies, “an entity is a ‘financial institution’ if it’s engaged in activity that is ‘financial in nature’ or is ‘incidental to such financial activities as described in section 4(k) of the Bank Holding Company Act of 1956’” (FTC Safeguards Rule).
As stated directly in the Safeguard Rules, a few examples of organizations that fall under the classification are as follows:
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- Automotive Dealerships
- Retailers that can issue their own credit cards to customers
- Personal Property or Real Estate Appraisers
- Businesses that print and/or sell checks for customers
- Businesses that regularly wire money to and from consumers
- Check Cashing Businesses
- Career Counselors
- Accountants and Tax Preparation Businesses
- Travel Agencies
- Mortgage Brokers
- Investment Advisory and Credit Counseling Services
- Real Estate Settlement Services
- Companies acting as a finder to bring buyers and sellers of any product or service together
((United States, 16 CFR 314.2(h)(2))
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It is important to make sure your organization is closely following all standards set in place by the FTC. If you are unsure if your current security practices meet regulations, our team of security experts can help.
Contact our sales team at rzsales@redzonetech.net to get started.
References:
United States, Federal Trade Commission. A Rule by the Federal Trade Commission: Part 314- Standards for Safeguarding Customer Information. Code of Federal Regulations, 23 May 2002. eCFR :: 16 CFR Part 314 — Standards for Safeguarding Customer Information Title 16, Ch I, Subchapter C, Part 314.2(h).
“FTC Safeguards Rule: What Your Business Needs to Know.” Federal Trade Commission, May 2022. FTC Safeguards Rule: What Your Business Needs to Know | Federal Trade Commission
