The FTC extended the enforcement date of the Red Flags Rule as it applies to non-financial institutions from November 1, 2009 to June 1, 2010. The extension came at the request of several members of Congress following the unanimous approval of HR 3763 on October 20, 2009, a bill that, if adopted and signed by President Obama, would exempt health care, legal and accounting practices with fewer than 20 employees from the Red Flags Rule. The FTC agreed to the delay to allow Congress to finalize the legislation and to ensure that it does not begin to enforce a regulation that Congress plans to supersede.
Judge Reggie B. Walton of the D.C. federal court issued an order granting an injunction prohibiting the Federal Trade Commission (“FTC”) from enforcing the Red Flags Rule against attorneys. Judge Walton ruled from the bench stating that he had trouble accepting the FTC’s definition of creditor. In the formal opinion that followed, Judge Walton stated that the application of the Red Flags Rule to attorneys exceeds the FTC’s statutory authority under the Fair and Accurate Credit Transactions Act of 2003. The ruling may be only a temporary reprieve as appeal from the FTC is anticipated.
The Massachusetts Office of Consumer Affairs and Business Regulation filed its final amendment to the Massachusetts security regulation (the “Regulation”) (effective date is March 1, 2010).
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