Red Flag Rules and Dealer Compliance Instructions

Provided by NIADA and CIADA

January 1st 2011 deadline for dealers to have written policy in place.

These documents are intended to explain, as well as provide compliance information. They are not intended to address the specific facts and circumstances of every motor vehicle dealership. Specific applications will vary depending upon how a motor vehicle dealership transacts business.

The Federal Trade Commission and the federal financial institution regulatory agencies have published final rules on identity theft “red flags” and address discrepancies. The Final Rules implement sections 114 and 315 of the Fair and Accurate Credit Transactions Act of 2003.

We have developed materials to assist Dealers in complying with the Rules. These materials are being provided to you for distribution free of charge.

• An Overview Memorandum of the Red Flags Rules
• A copy of the Rules (256 pages)
• Guidelines to assist your dealership in analyzing identity theft red flags and developing a written program;
• A model written dealership policy for the detection, prevention and mitigation of identity theft;
• An employee acknowledgment regarding the Dealership’s identity theft program;
• A service provider agreement addendum regarding the Dealership’s identity theft program;
• A service provider letter regarding the Dealership’s identity theft program.

Please keep in mind that these materials are designed to assist dealers in the development of a written dealership policy for the detection, prevention and mitigation of identity theft and are intended to serve as a guide. While not intended as a universal solution that every dealership can adopt, since they are drafted from a used motor vehicle dealer’s perspective, NIADA members should find that they are easy to use and customize for their dealerships. They may wish to consult with their legal counsel or other professional consultants to ensure that their dealership policies are appropriate and in compliance with applicable federal and state laws, rules and regulations. The information contained in this document and the additional materials provided are for general information purposes only and should not be considered as legal advice.