Regulators Are Cracking Down on Data Security: What Dealers Need to Know

• By: Stephen Pallas
• On: 02/14/2025 07:44:29
• In: Texas Posts
• Comments: 0

In recent months, both federal regulators and state agencies have taken steps to enhance data security enforcement. Dealers must not only comply with evolving rules but also be prepared for increased scrutiny in regulatory examinations. Additionally, Texas state leadership has made data security a priority, further reinforcing the need for dealerships to implement strong data protection measures. Here are three key developments shaping the data security landscape for Texas dealers:

• FTC Safeguards Rule Enforcement – The Federal Trade Commission (FTC) is now actively enforcing the revised Safeguards Rule, which requires financial institutions, including motor vehicle dealers, to implement stringent data security measures to protect customer information. Compliance is no longer optional—dealers must develop and maintain a comprehensive security program to avoid penalties and potential data breaches.

• OCCC's Focus on Data Security in Dealer Exams – The Texas Office of Consumer Credit Commissioner (OCCC) has announced that data security policies will be a key focus in upcoming dealer examinations. This means dealers can expect increased scrutiny of their data security practices. Ensuring that your dealership meets FTC requirements will also help you prepare for OCCC exams and avoid potential compliance issues.

• Governor Abbott's Texas Cyber Command Initiative – Governor Greg Abbott recently launched the Texas Cyber Command to strengthen the state's defenses against cyber threats. While this initiative is focused on public infrastructure, it underscores the growing emphasis on cybersecurity at all levels of government. This broader push for security makes it even more critical for dealers to proactively safeguard customer data.

With enforcement ramping up, Texas dealers cannot afford to take a wait-and-see approach. A strong data security policy not only protects your business from regulatory fines but also builds trust with customers who expect their sensitive information to be secure.
 
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