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FTC Announces Six-Months Delay on the Red Flags Rule

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On October 22, 2008 the Federal Trade Commission granted a six-month delay in the enforcement of the ‘Red Flags Rule’. The extension until May 1, 2009 will give creditors and financial institutions additional time in which to develop and implement written identity theft prevention programs. This announcement does not affect other federal agencies’ enforcement of the original November 1, 2008 deadline.

The Fair and Accurate Credit Transactions (FACT) Act of 2003 led to the development of the Red Flags Rule. The rule outlines how financial institutions and creditors with covered accounts must have identity theft prevention programs to identify, detect, and respond to patterns, practices, or specific activities that could indicate identity theft.

The guidelines set forth by this rule will have a positive impact for business in the secure information destruction industry.

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