The FTC Safeguards Rule
and Its Relevance

The FTC Safeguards Rule is a regulation that aims to protect sensitive customer information by setting requirements for financial institutions. In the context of the FTC Safeguards Rule, the term “financial institution” is defined more broadly than how many of us would typically think of it. It applies to “any institution the business of which is engaging in an activity that is financial in nature or incidental to such financial activities”. This is further defined in section 4(k) of the Bank Holding Company Act of 1956 12 U.S.C § 1843(k) (scroll to page 11 of the PDF).

Examples of covered Industries and Professionals

Tax preparers and CPAs
Financial planners
Title companies
Mortgage brokers and lenders
Auto dealers that lease automobiles

Compliance Requirements

To Comply With The FTC Safeguards Rule, Organizations Must:

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Appoint A Qualified Individual To Oversee The Information Security Program

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Conduct A Thorough Risk Assessment To Identify Potential Risks to customer information

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Develop a comprehensive information security plan addressing identified risks

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Implement and maintain the information security plan

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Regularly monitor and update the plan to ensure continued effectiveness

Possible Breach Consequences

Breaching the FTC Safeguards Rule can result in severe consequences, including:

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Civil penalties and fines

As much as $100,000 per violation with an additional $10,000 against officers and directors.

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Damage to the company's reputation

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Loss of customer trust

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Allstate Computers: Your Compliance and Cybersecurity Partner

Allstate Computers specializes in compliance and cybersecurity solutions, offering services tailored to the FTC Safeguards Rule:

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Risk assessment

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Information security plan creation and implementation

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Ongoing monitoring and management of the information security plan

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Serving as your qualified individual

Don’t wait until it’s too late – the FTC Safeguards Rule went into effect on June 9th, 2023. If you’re not already compliant and have a breach, your company and it’s officers and directors could be exposed to expensive civil penalties Let Allstate Computers help your organization become compliant and protect your customers’ sensitive information.

Contact Allstate Computers today to start your journey towards FTC Safeguards Rule compliance!