FTC Safeguards Compliance Without the Complexity
We make the Safeguards Rule straightforward for accounting firms, tax preparers, and financial advisors.
Schedule a MeetingThe updated FTC Safeguards Rule requires financial institutions — including accounting firms, tax preparers, mortgage brokers, auto dealers, and financial advisors — to implement comprehensive written security programs. Non-compliance penalties reach $50,000 per violation per day, and the FTC has signaled aggressive enforcement against firms that fail to meet the Rule's 16 safeguard requirements. We handle the technical and administrative requirements end-to-end: Qualified Individual designation, written security plan, access controls, encryption, incident response, and annual penetration testing. Our clients can demonstrate full compliance readiness with documented evidence — not just good intentions.
What's Included
Qualified Individual
We serve as or support your designated Qualified Individual responsible for your security program.
Written Security Plan
Comprehensive information security program documentation that satisfies FTC requirements.
Access Controls
Role-based access, MFA, and least-privilege configurations across all systems handling customer data.
Encryption
Data encryption at rest and in transit for all customer financial information.
Vendor Management
Third-party risk assessment and monitoring for all service providers with access to customer data.
Annual Penetration Testing
Required vulnerability assessments and penetration testing with documented findings and remediation.
Ready to Get Started?
Schedule a meeting to discuss how ftc safeguards compliance fits your organization.
Schedule a MeetingFrequently Asked Questions
Who does the FTC Safeguards Rule apply to?
The FTC Safeguards Rule applies to "financial institutions" as defined under the Gramm-Leach-Bliley Act — a broader category than banks. It includes accounting firms, tax preparers, mortgage companies, auto dealers, financial advisors, payday lenders, and any business that is significantly engaged in financial activities. If your firm handles customer financial data, the Rule almost certainly applies.
What is a Qualified Individual under the FTC Safeguards Rule?
The Safeguards Rule requires every covered financial institution to designate a Qualified Individual — either an employee or a service provider — who is responsible for overseeing, implementing, and enforcing the information security program. This person must report to the board or senior leadership at least annually. Katalism can serve as or formally support your Qualified Individual.
What does a written information security program need to include?
The FTC requires your written security program to cover risk assessment, access controls, encryption, secure development practices, multi-factor authentication, monitoring, change management, incident response, and vendor oversight. It must be reviewed and updated at least annually, and the Qualified Individual must report on its status to senior leadership.
Is annual penetration testing required under the FTC Safeguards Rule?
Yes. The updated Rule requires either annual penetration testing or continuous monitoring with bi-annual penetration testing, depending on your risk profile. The test must be performed by qualified personnel, and findings must be documented and remediated. This is a hard requirement — not a best practice recommendation.
How is the FTC Safeguards Rule different from HIPAA?
HIPAA governs Protected Health Information held by healthcare covered entities and business associates. The FTC Safeguards Rule governs customer financial information held by non-bank financial institutions under the Gramm-Leach-Bliley Act. A firm can be subject to both — for example, a healthcare billing company or a benefits administrator. The frameworks share structural similarities but have distinct requirements.
What happens if our firm is found non-compliant with the FTC Safeguards Rule?
The FTC can seek civil penalties of up to $50,120 per violation per day under the FTC Act. Beyond fines, a data breach at a non-compliant firm can trigger an FTC enforcement action, consent decrees, mandatory audits, and significant reputational damage. State attorneys general can also bring parallel enforcement actions.
Official Resources & Standards
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