FTC Delays Red Flags Rule for State CUs Posted by AVCU on 10:39 AM

The Federal Trade Commission (FTC) announced a delay of its enforcement of the "Red Flags" rule, which addresses identity theft, until 6/01/10. CUNA’s News Now reports that “Congress requested that the FTC delay enforcement of the rule, which was developed to implement parts of the Fair and Accurate Credit Transactions (FACT) Act of 2003.” The FTC action applies to state-chartered credit unions. Federal credit unions were required to comply with NCUA's red flag regulations effective 11/01/08. FACTA changes directed financial regulatory agencies, including the FTC, to put into place rules requiring those under its supervision that have covered accounts to implement programs to identify, detect, and respond to patterns, practices, or specific activities that could indicate identity theft. Consumer accounts or other accounts that financial institutions find to have a risk of identity theft are covered by the rule. The FTC previously delayed the enforcement of the rule for State Chartered credit unions until November 1, 2009.  Now the new effective date has been pushed back to June 1, 2010.