NADA UPDATE By the time you read this, the FTC Safeguards Rule (Rule) will have been in effect for at least a month. The Rule, which was previously scheduled to go into effect last November, has been live since June 9, 2023. The Rule, in short, requires dealers to undertake a series of procedural, technical and contractual steps to protect consumer and other personal data. Some, but not all, of the new standards require dealers to: • Designate a qualified individual to oversee their information security program, • Develop a written risk assessment, • Limit and monitor who can access sensitive customer information, • Encrypt all sensitive information, • Train security personnel, • Develop an incident response plan, • Periodically assess the security practices of service providers, and • Implement multi-factor authentication or another method with equivalent protection for any individual accessing customer information. Dealers are encouraged to continue in their efforts to expeditiously comply with all the new requirements of the Rule but should consult with their attorneys, service providers and IT professionals about the potential impact of this deadline extension. If you have questions regarding whom to consult on this topic, please reach out to the NHADA at support@nhada.com or (603) 224-2369. On the legislative front, NHADA and NADA are in support of catalytic converter anti-theft legislation (H.R. 621/S. 154). Catalytic converters are being stolen at increasingly higher rates due to their valuable metals, such as rhodium, platinum and palladium. Thefts reported to insurance companies have sharply increased over the past three years, and the National Insurance Crime Bureau estimates that these thefts increased by 1,215% between 2019 and 2022. The bipartisan “Preventing Auto Recycling Theft Act” (PART Act) (H.R. 621/S. 154) would help law enforcement combat this crime by providing a national framework that would mark catalytic converters, establish federal criminal penalties and create a more transparent market that deters its theft. Reminder: use NADA and NHADA as a resource center for your professional development. NHADA has rotating webinars available at www.nhada.com/training, similar to NADA, which can be found at nada.org. In addition to webinars, NADA has developed several downloadable guides on several different topics, a few of which are listed below: • A Dealer Guide to the FTC Safeguards Rule (L43); • A Dealer Guide to Electric Vehicles (SL46); • Online Financing and eContracting (L61); • Buying and Selling a Dealership (BM44); BY DAVID HAMMER NADA DIRECTOR 8
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