Red Flags Rule

July 22, 2009

On August 1, 2009, a new FTC rule (known as the “Red Flags Rule”) will go into effect which will require many businesses and organizations to implement safeguards to protect their consumers against identity theft. Under the Red Flags Rule, businesses and organizations are required to spot and act on certain activities or “red flags” that are often indicators of identity theft. To comply with the Red Flags Rule, these businesses and organizations will need to develop and adopt a written “red flags program” to identify and detect “red flags,” respond to the “red flags” detected, and ensure that the program is kept up-to-date in order to minimize the damage from identity theft. Further information can be found in the article titled, “Red Flags Rule.”
If you have questions regarding the above, please contact Derek Prestin, the author of this article, or any of the attorneys in the Business Transactions Practice Group of Ruder Ware.

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