Identity Theft Red Flags Rules; Joint Proposed Rules and Guidelines

CFTC SEC Joint Release 77 FR 13450

The CFTC and the SEC are jointly issuing proposed rules and guidelines to implement new statutory provisions enacted by Title X of the Dodd-Frank Act. These provisions amend section 615(e) of the Fair Credit Reporting Act and direct the CFTC and SEC to prescribe rules requiring entities that are subject to their jurisdiction to address identity theft in two ways. First, the proposed rules and guidelines would require financial institutions and creditors to develop and implement a written identity theft prevention program that is designed to detect, prevent, and mitigate identity theft in connection with certain existing accounts or the opening of new accounts. They also are proposing guidelines to assist entities in the formulation and maintenance of a program that would satisfy the requirements of the proposed rules. Second, the proposed rules would establish special requirements for any credit and debit card issuers that are subject to their jurisdiction, to assess the validity of notifications of changes of address under certain circumstances.

Comments Due: May 7, 2012

Cross References: Part 162; Part 248; Dodd-Frank Act Title X; Submit comments on S7-02-12.

For more information about this document, you may contact one of the following Cadwalader attorneys: Steven D. Lofchie; Robert Zwirb.