Published in the Manchester Union Leader, January 2011.
(Published in the New Hampshire Business Review, January 2011)
In early December 2010, a broad range of unsuspecting companies were required to comply with the Red Flags Rule and create an Identity Theft Prevention Program. A week before Christmas, President Obama narrowed the reach of the Red Flags Rule and signed into law the "Red Flag Program Clarification Act of 2010."
The law limits the scope of the Red Flags Rule to creditors that regularly and in the ordinary course of business: (1) obtain or use consumer reports, directly or indirectly, in connection with a credit transaction; (2) furnish information to certain consumer reporting agencies in connection with a credit transaction; or (3) advance funds to or on behalf of a person, based on a person's obligation to repay the funds or on repayment from specific property pledged by or on the person's behalf. The revised definition of "creditor" excludes creditors "that advance...