SEC Approves ID Theft Rules

Mary Jo White was sworn in as SEC chairman and led a meeting where the agency approved rules requiring brokers and investment advisors to adopt identity-theft prevention programs.

The meeting was White’s first as the SEC’s 31st chairman. She replaced Elisse B. Walter, a commissioner who had run the agency since Mary Schapiro stepped down as chairman in December. Walter resumed her role as a commissioner.

“It is my privilege to be here and to join today in these important efforts to protect investors and to insure the strength, efficiency and transparency of the securities markets,” White said in her opening comments. “I look forward to working hard with my fellow commissioners and the dedicated staff of the commission.”

The five-member panel unanimously approved an identity theft protection rule almost identical to one previously issued by the Federal Trade Commission. It requires financial firms to administer identify theft “red flags,” the SEC said.

The Dodd-Frank Act of 2010 transferred responsibility for the rules from the FTC to the SEC and Commodity Futures Trading Commission. The CFTC is expected to approve similar rules for entities that it oversees, White said.

Companies subject to the rule will have seven months to comply, the SEC said in a fact sheet.

“These rules are a common-sense response to the growing threat of identity theft to all Americans who invest, save or borrow money,” White said.