FTC Backs Off Red Flag Rules Again

coondoggie writes to tell us that the Federal Trade Commission has yet again backed off of the new Red Flag Rule designed to protect consumer information. Complaining about cost of implementation, the enforcement date of the rule has been pushed back to August 1, 2009 to give businesses and institutions time to implement identity theft-prevention programs. "The FTC, federal bank regulatory agencies, and the National Credit Union Administration (NCUA) issued the Red Flags Rules as part of the Fair and Accurate Credit Transactions (FACT) Act of 2003. The final rules require financial and credit institutions that hold any consumer account, or other account for which there is a reasonably foreseeable risk of identity theft, to develop and implement an Identity Theft Prevention Program for combating identity theft in connection with new and existing accounts, the FTC said."

Comments

Costs too much, huh?

[SirGarlon]

A survey done by the MedPage today of 100 hospitals found that they would have to spend over $10,000 to comply with the Red Flag Rule.

In comparison with the operating budget of a typical hospital, I hardly think $10,000 is a major expense. They probably spend more than that waxing the floors every year.

What's the average cost incurred by a single victim of identity fraud? Last I heard it was over $5k. So for the hospital to save its petty $10k in implementation costs, how many patients are they willing to screw over? (All of 'em, it seems.)

Re:Costs too much, huh?

[Lumpy]

So for the hospital to save its petty $10k in implementation costs, how many patients are they willing to screw over? (All of 'em, it seems.)

When was the last time you were in the hospital or had to deal with one? Hospitals are DESIGNED to rob people blind. My wife had a 2 day stay and she brought her own meds. the Hospital tried to charge us for them because the nurse gave them to her. It was only an extra $190.00 per day charge. Oh they charged us $80.00 for that paper gown as well that she wore. as well as aniother $60.00 for the cleaning crew to come in and mop her floor. Then they walked out leaving dirty footprints all over it.
I am certian that If I complainedt othem about taking it up the arse, they would add a line item charge for lube

Re:Costs too much, huh?

[sortius_nod]

That's exactly why I hate this whole idea of a user pays society.

There are some things that are needed to be part of the government system... health, education, and welfare.

Example, here in Australia, we have free(ish) health. On Good Friday I awoke with intense abdominal pains so I went to hospital. Sure, I spent about 1.5-2hrs waiting to be seen, but once I was seen I had a bed, a doctor and a nurse. I was doped up on morphine, had a saline drip to got to watch TV while they did my blood & urine tests. All up I was in the bed for about 6hrs.

All this cost me a grand total of: $0

What I really want!

[glennpratt]

Free, instant access to any credit bureau.

It's ridiculous the information they can store about me and then turn around and charge ME to look at it more than once a year. And my credit score, that should be free for me to view as well.

I've already had two mistakes on my credit and I'm 25 (1 identity theft and 1 Verizon decided I didn't return FiOS equipment - of course I didn't return it, it's still in use!).

Making this information free and accessible would be a start.

Don't Confuse Banks and Credit Unions

[mpapet]

They are separate and generally speaking do not follow the same rules.

For example, Bank of America and Chase would not be required to follow these rules.

The 'backing off' doesn't surprise me one bit as the NCUA is probably in as much trouble as the FDIC with failed credit unions, and lack of funds to protect depositors.

http://www.cutimes.com/Pages/News.aspx

Red Flag Rule = Guessing Game

[Silentknyght]

Though the article summary touts the Red Flag Rule(s) as something that is designed to protect consumer information, I have serious doubts as to the efficacy of such a system.

As stated in the article, it's just a system/rule to force banks/creditors/etc. to identify any suspicious activity (i.e. red flags) in their accounts. It doesn't seem to mention anything about any liability or culpability for false positives or worse--completely missing identity theft in action. That said, I still can't believe (provided the inforamtion is true) that companies continue to balk at this. The sums mentioned in the article--$10,000 to comply--are chump change, even if it's a repeated annual expenditure.

Probably useless...

[UncleTogie]

I've got my doubts about what this will accomplish.

As a point-of-sale vendor, we ran across this recently. Some bozo was slinging stolen cards at some of our clients, and we TRIED to report it. No calls back, no interest from the local PD, the FBI, the FTC, or even the Secret Service. It just wasn't big enough to make their radar and assign manpower to it.... even after 2 grand in fake charges.

I'd like to see them do more when people with all the evidence they would want call them, rather than implement a new program that will drain even more manpower from enforcement.

Considering that even one

[Jane Q. Public]

serious case of identity theft could cost a single one of their "customers" more than $10,000 I think it is reasonable to expect them to do it.