What are the Requirements for Auto Dealerships?
The Federal Trade Commission (FTC) Safeguards Rule was updated to impose stricter cybersecurity requirements on various industries, including auto dealerships. The updated rule, which came into effect on June 9, 2023, mandates that auto dealerships implement robust security measures to protect customer data. Compliance is not just a legal requirement but a critical step in protecting your dealership from cyber threats.
Why are Auto Dealerships Required to be Compliant?
Auto dealerships collect and store sensitive customer information, such as financial data, social security numbers, and driver’s license details. Due to the nature of this information, auto dealerships are prime targets for cyberattacks. The FTC Safeguards Rule aims to protect this data by enforcing stringent cybersecurity practices. Even though the compliance deadline was June 9, 2023, it’s not too late to get your dealership compliant. Empowered IT Solutions can assist you in meeting these requirements and securing your customer data.
The Security Requirements
Designate a Qualified Individual (QI)
The FTC Safeguards Rule requires dealerships to appoint a qualified individual responsible for implementing and supervising the information security program. This individual should have the expertise and authority to manage the program effectively.
Conduct a Risk Assessment
Risk assessments are crucial for identifying potential vulnerabilities within your dealership’s IT systems. This process involves evaluating the likelihood and impact of various security threats.
Design and Implement Safeguards
Based on the risk assessment, dealerships must design and implement safeguards to control identified risks. These safeguards could include encryption, multi-factor authentication, and secure data storage practices.
Regular Monitoring and Testing
Continuous monitoring and regular testing of your security measures are necessary to ensure they remain effective against evolving threats.
Security Awareness Training
Employees are often the weakest link in cybersecurity. The FTC Safeguards Rule mandates regular cybersecurity training for all employees to minimize human error and enhance security awareness.
Monitor Service Providers
Dealerships must ensure that their service providers, such as IT vendors and third-party partners, comply with the same cybersecurity standards.
Keep Your Information Security Program Current
The cybersecurity landscape is constantly evolving, and your information security program should evolve with it. The FTC Safeguards Rule requires dealerships to update their security programs regularly.
Create a Written Incident Response Plan
In the event of a data breach or cyberattack, having a written incident response plan is essential for minimizing damage and recovering quickly. This plan should outline the steps to take immediately following an incident.
Report to Your Board of Directors
The FTC Safeguards Rule requires that the designated qualified individual provide regular reports to the board of directors on the effectiveness of the information security program.
Our team specializes in guiding businesses through the compliance journey. From conducting risk assessments to implementing security measures, our experts will ensure that your dealership is compliant with all FTC regulations, protecting both your customers and your business.