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Veterinarians Slated To Be Exempt From Red Flags Rule

Veterinarians Slated to be Exempt from Red Flags Rule

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Veterinarians practices and other health care practices are on the brink of being exempt from the Federal Trade Commission’s Red Flags Rule now that both the House and Senate have passed the Red Flag Program Clarification Act. It currently awaits the President’s signature before becoming law.Veterinary practices and other health care practices are on the brink of being exempt from the Federal Trade Commission’s Red Flags Rule now that both the House and Senate have passed the Red Flag Program Clarification Act. It currently awaits the President’s signature before becoming law newsline

Veterinarians Slated to be Exempt from Red Flags RuleVeterinary practices and other health care practices are on the brink of being exempt from the Federal Trade Commission’s Red Flags Rule now that both the House and Senate have passed the Red Flag Program Clarification Act. It currently awaits the President’s signature before becoming law.

The Red Flag Program Clarification Act, as described by the American Veterinary Medical Association, defines the term “creditor” more narrowly than the FTC had, with the intent of exempting small businesses and other service providers who do not receive payment in full from their clients at the time they provide their services.

The AVMA was part of a coalition of professional associations lobbying for this legislation. If signed, the law will save veterinary practices compliance expense and time, according to the AVMA.

The passage comes just weeks before enforcement of the rule begins on Dec. 31. The Red Flags rule became effective on Jan. 1, 2008, but the FTC has since issued several Enforcement Policies delaying enforcement to allow Congress time to finalize legislation that would limit the scope of businesses covered by the rule.

The Red Flags Rule, a section of the Fair and Accurate Credit Transaction Act of 2003, is an anti-fraud regulation requiring creditors and financial institutions with covered accounts to implement programs to identify, detect and respond to the warning signs, or “red flags,” that could indicate identity theft.

Veterinarians previously fell into the category of creditors, which, prior to the new legislation, was defined as any entity that regularly extends or renews credit—or arranges for others to do so—and includes all entities that regularly permit deferred payments for goods or services.
 

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Related story: FTC Extends Red Flags Rule Enforcement to December

 

12/9/2010 3:32 PM

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