FTC issues third delay of "Red Flags" Rule

For the third time, the Federal Trade Commission has delayed enforcement of its identity-theft protection system, or "Red Flags" Rule, which applies to physicians' offices. The new live date is November 1.

Following postponements in February and May, this third delay is "certainly unusual," says Arthur N. Lerner, a partner at Crowell Moring, a law firm in Washington, D.C. Lerner, a former FTC official, anticipates identity-theft enforcement by the commission will eventually happen.

"I think the FTC feels constrained that they can't just wholesale cross out and say doctors and lawyers and architects are exempt from this," Lerner says. "So they have repeatedly said, 'We are not going to let you guys off the hook, but you're overstating your fears about how burdensome this is going to be.' "