FTC Released a Guide Buying or Selling Debts- Steps for Keeping Data Secure (April 2015)

Buying or Selling Debts? Steps for Keeping Data Secure

April 2015

The Federal Trade Commission (“FTC”) released a Guide Buying or Selling Debts? Steps for Keeping Data Secure that emphasizes the critical importance of data security in the debt buying and selling industry. It highlights that companies must be proactive in minimizing the sensitive information they collect, ensuring its security while necessary, and safely disposing of it when no longer needed. The piece underscores the sensitivity of the information involved, as public disclosure of debts can lead to severe consequences for consumers, including identity theft and financial fraud.

The guide outlines several key security practices recommended by the FTC. Firstly, it advises against publicly disclosing any consumer data, likening it to a hazardous material that requires strict handling. It suggests securely storing both paper and electronic data, limiting access to authorized personnel only. When sharing information with potential buyers, companies should minimize the data provided and ensure that those buyers have robust security measures in place.

Additionally, the guide stresses the importance of secure data transfer methods, such as encryption, and the need for safe disposal practices to prevent unauthorized access to discarded information. It also recommends that companies prepare a response plan for potential data breaches, including how to notify affected parties in compliance with state laws. Lastly, it encourages businesses to utilize FTC resources for guidance on protecting sensitive data, reinforcing that security practices are not just regulatory requirements but also vital for maintaining industry integrity and consumer trust.

For more information, see here:  https://www.ftc.gov/tips-advice/business-center/guidance/buying-or-selling-debts-steps-keeping-data-secure

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