September 4, 2009
ABA v. FTC Over Red Flags Rule
The American Bar Association has filed suit in the U.S. District Court for the District of Columbia against the Federal Trade Commission, seeking an injunction to block the application of the “Red Flags Rule” to practicing lawyers.
The ABA has been lobbying for months to exempt lawyers from the “Red Flag” regulations that require businesses and organizations that act as “creditors” to establish a program for preventing identity theft. The FTC has included lawyers, doctors, and many other professionals in its definition of “creditors” because they bill customers only after providing services. The ABA’s 20-page complaint says applying the rule to lawyers is arbitrary and contrary to the law.