The FTC changed the Red Flags enforcement date from October 1, 2009 to November 1, 2009 to give creditors and financial institutions more time to review guidance.
Financial institutions and creditors who offer credit to their customers, either though in-house financing, branded credit card programs, layaway facilities or any other credit arrangement must now comply. Jewelry businesses that only accept credit cards as a form of payment are not considered creditors and do not have compliance obligations.
The rules, effective since last January, require a business to establish a written program designed to detect "red flags" indicating an attempt to steal identity information and to put in place a program to prevent such thefts. Red flags include alerts from a credit reporting company about suspicious identification documents or activity on the internet that indicates an attempt to access identification information by an unauthorized third party.
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