Thune-Begich Legislation Clarifying "Red Flags Rule" Passes House
After passing both chambers of Congress, bill headed to president's desk for signature
WASHINGTON, D.C.-U.S. Sens. John Thune (R-S.D.) and Mark Begich (D-Alaska), today praised the House of Representative's swift passage of their bipartisan bill, the Red Flag Program Clarification Act of 2010, which clarifies a burdensome regulation by the Federal Trade Commission (FTC) that would otherwise require small businesses to undertake costly and unnecessary measures to prevent identity theft. The Thune-Begich bill passed the full House of Representatives today by voice vote. The Thune-Begich bill passed the full Senate by Unanimous Consent on November 30, 2010 and will now move to President Obama's desk to be signed into law.
"I commend my colleagues in the House of Representatives for wasting no time in passing the Thune-Begich legislation clarifying the Red Flags Rule to protect our nation's small businesses from unnecessary and burdensome federal regulation," said Thune. "Instead of worrying about being punished under the FTC rule that was set to take effect on January 1st, small businesses can now breathe a sigh of relief."
"Businesses in Alaska will be better served with this approach. The bill targets the very heart of identity theft, the use of consumer credit reports instead of lumping all small businesses as having the same risk of identity theft," Begich said. "This bill was carefully crafted, and I am proud to work with my colleagues on this issue."
The FTC issued the Red Flags regulations under the Fair and Accurate Credit Transition Act of 2003, which requires the establishment of guidelines for financial institutions and creditors regarding identity theft. If implemented on January 1, 2011, as planned, the FTC's overreaching definition of a creditor would place a significant burden on our nation's small businesses. Recognizing this, the FTC has delayed implementation of the rule multiple times to allow for Congressional clarification.