The FTC Safeguards Rule will be enforced starting 12/9/2022. Failure to comply will result in hefty fines, prison time, and losing your job or business.

On October 27, 2021 the Federal Trade Commission (FTC) announced changes to the FTC Safeguards Rule in order to protect consumer data. The new cybersecurity rules were published on December 9, 2021 and will require compliance by December 9, 2022.

Entities expected to comply are still classified with the very misleading title of “Financial Institution,” where the term “finance” refers to any relations with customer financial data, either through lines of credit, loans, or general financial information.

Some examples of businesses classified as “Financial Institutions” by the FTC include accountants and tax preparation services, insurance agencies, law firms & several more.

There are separate penalties for non-compliance, applicable to the violating organization and its officers and directors. The penalties for violating organizations are:

A civil penalty of up to $100,000 per violation.
Fines in accordance with Title 18 of the United States Code.

The penalties for violating officers and directors are:
A civil penalty of up to $10,000 per violation.
Imprisonment up to 5 years.

We're going to clear up what all of this means and explain what you can do to protect yourself and your business.

Derreck Ogden, CEO of WOM Technology Management Group with guest Guy Bavly, CEO of Actifile