U.S regulators are proposing rules designed to help prevent identity theft by imposing new requirements on firms to have programs in place to detect and disrupt such activity.
The U.S. Securities and Exchange Commission and the U.S. Commodity Futures Trading Commission issued a joint rule proposal Tuesday, which are aims to help protect investors from identity theft by ensuring that broker-dealers, mutual funds, and other SEC- and CFTC-regulated entities create programs to spot the signs of identity theft.
The SEC’s rule proposal would require SEC-regulated entities to adopt a written identity theft program that would include reasonable policies and procedures to: identify relevant red flags; detect the occurrence of those red flags, and respond to them appropriately. The proposed rule would also include guidelines and examples to help firms administer their programs.
The CFTC proposal would impose similar requirements on futures commission merchants, introducing brokers, commodity pool operators and other CFTC-regulated entities.
Similar rules were adopted by the Federal Trade Commission and other federal financial regulatory agencies in 2007. The proposals are out for a 60-day public comment period.