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FTC Safeguards Rule Policy

Purpose:
The purpose of this policy is to ensure [Dealership Name] complies with the Federal Trade Commission (FTC) Safeguards Rule, which requires businesses to develop, implement, and maintain a comprehensive information security program to protect customer information.

1. General Policy Statement

[Dealership Name] is committed to protecting the security, confidentiality, and integrity of customer information. In compliance with the FTC Safeguards Rule, the dealership will implement and maintain a written Information Security Program designed to safeguard customer data against unauthorized access, misuse, or destruction.

2. Scope

This policy applies to all dealership personnel and third-party service providers who collect, access, or process customer information. It covers all forms of non-public personal information (NPI), whether stored electronically or in physical form.

3. Responsibilities

3.1 Compliance Officer

  • Oversees the Information Security Program.
  • Conducts risk assessments and ensures the implementation of safeguards.
  • Coordinates audits, employee training, and compliance monitoring.

3.2 IT Department

  • Implements and manages technical safeguards to protect electronic data.

3.3 All Employees

  • Follow data protection policies and report any security incidents or concerns.

4. Policy Provisions

4.1 Development of an Information Security Program

  • Create and maintain a written Information Security Program tailored to the dealership’s size, complexity, and the nature of its operations.
  • The program will include:
    • Risk identification and assessment.
    • Design and implementation of safeguards.
    • Ongoing monitoring and improvement.

4.2 Risk Assessments

  • Regularly assess internal and external risks to customer information, including risks associated with:
    • Unauthorized access or use of customer data.
    • Physical or electronic threats to data security.
    • Use of third-party service providers.
  • Document findings and implement safeguards to address identified risks.

4.3 Safeguards Implementation

Administrative Safeguards

  • Assign responsibility for information security to qualified personnel.
  • Conduct background checks for employees handling sensitive customer information.
  • Require employees to sign confidentiality agreements.

Technical Safeguards

  • Implement access controls to limit data access to authorized personnel only.
  • Use encryption to protect sensitive customer data during transmission and storage.
  • Deploy firewalls, intrusion detection systems, and antivirus software.
  • Ensure regular updates to security software and systems.

Physical Safeguards

  • Secure physical files containing customer information in locked cabinets or rooms.
  • Restrict access to areas where sensitive data is stored.
  • Shred or securely dispose of documents containing customer information.

4.4 Employee Training

  • Provide initial and ongoing training to employees on:
    • Safeguards Rule requirements.
    • Proper handling of customer information.
    • Recognizing and reporting potential security threats.

4.5 Monitoring and Testing

  • Regularly test the effectiveness of the dealership’s security safeguards through:
    • Internal audits and system checks.
    • Penetration testing of electronic systems.
    • Review of access logs and security incident reports.

4.6 Oversight of Service Providers

  • Conduct due diligence before engaging third-party service providers who handle customer information.
  • Require service providers to implement safeguards that meet FTC Safeguards Rule requirements.
  • Periodically monitor and evaluate service providers for compliance.

4.7 Incident Response Plan

  • Establish and maintain an Incident Response Plan that includes:
    • Immediate actions to contain and investigate security incidents.
    • Notification to affected customers and regulatory agencies, as required by law.
    • Documentation of incidents and corrective measures taken.

4.8 Record Retention and Disposal

  • Retain customer records only as long as necessary for business or legal purposes.
  • Securely dispose of customer records by shredding, pulping, or secure electronic deletion.

5. Monitoring and Auditing

  • Conduct regular internal audits to ensure compliance with the Safeguards Rule.
  • Document findings and implement corrective actions as needed.
  • Review and update the Information Security Program annually or when significant changes occur.

6. Penalties for Non-Compliance

Non-compliance with the FTC Safeguards Rule can result in:

  • Regulatory fines and penalties.
  • Civil liability for damages resulting from security breaches.
  • Reputational harm to the dealership.
  • Employees found in violation of this policy may face disciplinary action, up to and including termination.

7. Policy Updates

This policy will be reviewed and updated annually, or as changes to the FTC Safeguards Rule, dealership operations, or industry standards occur.

Acknowledgment
I acknowledge that I have read and understand the FTC Safeguards Rule Compliance Policy and agree to abide by its provisions.

Employee Signature: ___________________________
Date: ___________________________

Manager Signature: ___________________________
Date: ___________________________

This policy ensures that [Dealership Name] complies with the FTC Safeguards Rule, protects customer information, and mitigates risks associated with data breaches or unauthorized access.