While most travel agencies do not usually offer or extend credit, those that do may need to conform with new rules proposed by the Federal Trade Commission (FTC). The FTC will begin enforcing a rule requiring "creditors" to take steps to combat identity theft in connection with "covered" deferred payment accounts, ASTA reports.
Known as the Red Flags Rule, the regulations require certain affected businesses to adopt vigilant internal procedures directed at identity theft prevention. To assist member agents ASTA has released a new white paper titled "Calculating Your Risk Factor – Identity Theft" that details the FTC's new requirements.
In a statement, the FTC said that it is delaying— at the request of several members of Congress— enforcement of the rule through December 31. Congress is considering legislation that would affect the scope of entities covered by the Red Flags rule.
“Congress needs to fix the unintended consequences of the legislation establishing the Red Flags Rule— and to fix this problem quickly,” FTC Chairman Jon Leibowitz said. “As an agency we’re charged with enforcing the law, and endless extensions delay enforcement.”
The rule was developed under the Fair and Accurate Credit Transactions Act, in which Congress directed the FTC and other agencies to develop regulations requiring “creditors” and “financial institutions” to address the risk of identity theft. The resulting Red Flags Rule requires all such entities that have “covered accounts” to develop and implement written identity theft prevention programs to help identify, detect, and respond to patterns, practices, or specific activities – known as “red flags” – that could indicate identity theft.
There have been several delays in enforcement of the rules to allow Congress time to finalize legislation that would limit the scope of business covered by the rule, the FTC said.
Visit www.ASTA.org or www.FTC.gov.