FTC Extends Deadline — But Compliance Still Required!by David N. Robertson
As many of you have likely already heard, the FTC has yet again extended its enforcement of the Red Flags Rule until December 31, 2010. We'd like to take this opportunity to remind you that, according to the FTC's website, the Red Flags Rule is still in force and can be enforced by any other relevant agency and possibly at the state level as an Unfair & Deceptive Act or Practice claim. We wanted to ensure you are all aware that this extension does not mean you can put off compliance. It is our fear that this latest extension will serve as an irresistible battle cry for other regulatory agencies (federal and state) and opportunistic class-action lawyers nationwide. Also, because banks and other lenders are in greater jeopardy if they sell to an identity thief (because they may fall under the direct regulatory control of another enforcing agency), many of them are continuing to require proof of Red Flags compliance despite the new deadline.
AFIP's official stance is that compliance should have begun for all dealerships nationwide on the original deadline in November 2008. As part of AFIP's commitment to the industry, we will help any and all dealerships in the United States avoid expensive fines, class-action lawsuits and negative media coverage. Creating a program is inexpensive and minimally disruptive with AFIP's DealerAide: Red Flags Rule. This support program is available through AFIP Industry Members at the lowest pricing available. The retail price is $250 (plus S&H and tax) per store. For more information on getting reduced pricing from an AFIP Industry Member, please call 817.428.2434.
In the end, only a regulatory body or a judge can determine whether or not you’re in compliance. It is imperative that you ensure you've taken reasonable steps by implementing a complete program and obtaining written affirmation from a qualified attorney that in his or her opinion, you've satisfied due diligence requirements.
AFIP created DealerAide because the FTC provided program templates only for low-risk businesses, which doesn't include most dealerships. AFIP executive director David Robertson realized that it would simply be impossible for the FTC to create an industry-specific template for every high-risk business in the U.S., and used his background in dealerships and the automotive industry in general to create a template that was actually something dealers could use. Additionally, we've kept the cost low and the program flexible to ensure each and every dealership, no matter how large or small, could afford and use the program.
We realize that the reason for the FTC's delay may be related to making adjustments to the rule, and as such, anyone who purchases DealerAide: Red Flags Rule will receive any program updates related to these changes for no additional charge (there may be an additional charge for items that must be shipped). There's no risk associated with getting into compliance now, so don't get caught short!
For more information about DealerAide, go to here .
To view the FTC's official announcement, go to here .
The regulatory knowledge and ethical standards that comprise it make the AFIP Certification Program the preferred defense for prevention-conscious dealers.
For more information on the AFIP Certification Program or for marketing copies of this article, contact AFIP at 817.428.2434.