FSI Submits Comments on SEC Red Flags Rules

On March 6, 2012, the Securities and Exchange Commission (SEC) published in the Federal Register a Proposed Rule that would implement new statutory provisions contained in Title X of the Dodd-Frank Wall Street Reform and Consumer Protection Act. Title X of the Dodd-Frank Act amended the Fair Credit Reporting Act of 1970 (FCRA) to include the SEC on the list of federal agencies required to jointly promulgate rules and guidelines regarding identity theft red flags for financial institutions and creditors. Under the Proposed Rules, financial institutions that offer or maintain one or more covered accounts would be required to develop a written program that is designed to detect, prevent and mitigate identity theft in connection with the maintenance of a covered account.

On May 7, FSI submitted a comment letter urging the SEC to limit deviations from the FTC's previously adopted identity theft red flag rules to avoid unnecessary cost associated with updating existing policies and procedures to bring them in compliance with the new rules.

Please click here to read our comment letter.