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One dealer in the audience raised a concern about how the Safeguards Rule will be enforced. How can dealers be sure their third-party providers are protecting consumer data? Dealers may be fearful that they will get hammered by the FTC because of their vendors’ non-compliance, even if they have no control of that.

“The expectation of the regulation isn’t that dealers or other entities have perfect insight or perfect control,” Dwyer said. “The requirement is that they implement reasonable policies and procedures, enact them and make sure they’re more than just paper.”

Also, dealers should document when they’ve reached out to their vendors to make sure information is safeguarded.

Dwyer added that the FTC only has the resource to bring a handful of enforcement actions each year, so it prioritizes those who are clearly defying or ignoring the rule, rather than someone who is doing due diligence.

One vendor asked Dwyer to define what the FTC considers is good “disclosure.”

Dwyer said the definition is clear and conspicuous, with “clear” meaning “in plain language” and “conspicuous” meaning “plainly visible or audible.”

Petersen said a negative example would be an advertisement for a particular term at the very top of an ad, but the disclosure is written in “mouse print” hidden at the bottom of the page. “It can provide additional information or additional circumstances, but the disclaimer can’t walk something back,” Dwyer said.

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