Red Flags Rule Deadline Extended to June 1, 2010

At the request of Congress, the Federal Trade Commission (FTC) is once again delaying enforcement of the “Red Flags” Rule until June 1, 2010. The Commission had previously delayed the enforcement of the regulation until November 1, 2009.

The regulation requires certain entities, regardless of industry or size, to create written policies and procedures to address the issue of identity theft.The Red Flag Rule, as this regulation is commonly known, sets forth guidelines as to how an entity should develop, implement and administer an identity theft program.

The delay is due to a bill pending Senate approval that would exempt health care, legal and accounting firms employing fewer than 20 people. Additionally, on October 30, 2009, the U.S. District Court for the District of Columbia ruled that the FTC may not apply the Red Flags Rule to attorneys, which had been listed by the FTC as one of many affected parties.