Specifically tailored to automobile dealers, the Federal Trade Commission released a set of Frequently Asked Questions on the Safeguards Rule this week.
The Safeguards Rule, which was updated in 2021 and took effect with its new requirements in May 2024, provides specific guidelines for financial institutions to protect customer information. Auto dealers who provide financing are subject to the requirements of the Safeguards rule.
To comply with the Safeguards Rule, dealers must adopt a written program to secure customer information against anticipated threats and unauthorized access, and include a response plan. A designated qualified individual must oversee the program, which is regularly monitored and kept current. An annual report to the company’s leader is recommended. Any breaches resulting in the exposure of customer information must be reported to the FTC within 30 days.
“The publication of this resource is a reminder that the FTC continues to take its oversight responsibilities over the automotive industry very seriously,” said NIADA Director of Government Relations and Compliance Patrick O’Brien. “NIADA members should read these FAQs carefully and make the necessary adjustments to their compliance management programs.”
