Federal Trade Commission Has Set New Data Management Regulations
The United States Federal Trade Commission has always had a set of guidelines that dictate the way that non-banking financial institutions manage and protect data. In 2023, however, the FTC officially put a set of amended Safeguards Rules in place that do a better job of covering modern computing and data protection. The aim is to encourage these organizations to actively do more to protect the individual personal and financial data they have on file.
What are FTC Safeguards?
The FTC Safeguards Aims to Promote Strong Data Privacy Practices
The rules and regulations that make up the FTC’s Safeguards are designed to protect sensitive information of all types from unauthorized access. These include personal data, financial information, health data, and more. While banking institutions are regulated by the Securities and Exchange Commission (SEC), non-banking financial institutions such as mortgage providers, insurance companies, and any organization that allows for financing operates under the FTC’s purview and needs to meet the updated criteria of their Safeguards Rule.
Components of Organizational Data Security
To Stay Compliant, Organizations Need to Accomplish These Actions
To stay compliant to the FTC Safeguards Rule, an organization will need to do the following:
Thorough Risk Assessment
Under FTC guidelines, businesses are required to conduct a thorough risk assessment to identify potential vulnerabilities and risks associated with consumer data. This assessment helps businesses develop appropriate security measures tailored to their specific needs.
Encrypt Data at Rest and In Transit
Encryption plays a crucial role in safeguarding consumer data. FTC safeguards recommend the use of strong encryption algorithms to protect data both at rest and in transit, ensuring that even if the data is compromised, it remains unreadable and unusable.
Control Authorized Access
Implementing robust access controls is essential to restrict unauthorized access to consumer data. This involves assigning unique user IDs, strong passwords, and implementing multi-factor authentication to verify the identity of users accessing sensitive information.
Comprehensive Employee Training
Human error is one of the leading causes of data breaches. By providing comprehensive training and raising awareness about data security best practices, businesses can empower their employees to handle consumer data responsibly and mitigate the risk of accidental data leaks.
Our team can help you build a comprehensive plan to keep your data secure. If your organization is considered a non-banking financial institution and needs help staying compliant to any of the regulations your business operates under, give the knowledgeable IT experts at The Connection, Inc. a call at 732-291-5938.