The Federal Trade Commission last week announced a newly updated rule that strengthens the data security safeguards that financial institutions are required to put in place to protect their customers’ financial information. In recent years, widespread data breaches and cyberattacks have resulted in significant harms to consumers, including monetary loss, identity theft and other forms of financial distress. The FTC’s updated Safeguards Rule requires non-banking financial institutions, such as mortgage brokers, motor vehicle dealers and payday lenders, to develop, implement and maintain a comprehensive security system to keep their customers’ information safe.
“Financial institutions and other entities that collect sensitive consumer data have a responsibility to protect it,” said Samuel Levine, director of the FTC’s Bureau of Consumer Protection. “The updates adopted by the Commission to the Safeguards Rule detail common-sense steps that these institutions must implement to protect consumer data from cyberattacks and other threats.”
To read the full proclamation from the FTC click here.