Condo Media - January 2010 - 47

funds with check or debit privileges would fall under this act. Community associations and management companies in most cases would not be considered financial institutions under the new rules. The definition of “creditor,” however, is much broader. Under the rule, creditors include entities that grant loans, extend credit and make credit decisions, as well as businesses, nonprofits or government agencies that allow customers to regularly defer payments for goods and services. While the regulation is not clear as to what frequency of payment deferral is “regular” for purposes of application, where such deferrals provided by associations are more than isolated occurrences, it is likely they would be considered creditors under the rule. Community associations that offer “bill me later” options, installment plans or similar deferral of payments for assessments or other payments may be covered by the rule. There is a reasonable argument that, as interpreted by case law, an association would not be a “creditor” if a homeowner/member did not have the “right” to defer payments (which many or most likely do not). However, the FTC takes an expansive view of the law’s reach. So, some members of CAI could be considered creditors under the rule. As the applicability issue is somewhat cloudy and compliance with the rule is not especially difficult, CAI has prepared a sample compliance policy for associations who wish to comply with the rule or who want to put a policy in place to provide protections to member financial data. If an entity is either a financial institution or a creditor, it also must hold a covered account in order to fall under the provisions of the rule. There are two types of covered accounts. The first is a transactional consumer account, such as a credit card, bank account, mortgage or other account, that permits multiple payments or transactions for personal, family or household purposes. The second is any account where there is a foreseeable risk to the consumer or to the safety and soundness of the financial institution or creditor from identity theft. These accounts would include both personal accounts and accounts where there is a perceived risk of identity theft. It is likely that if a community association were considered a creditor, it also would be found to have covered accounts under the rule. Requirements for Covered Entities The FTC rule requires a covered organization to establish a program tailored to the size, complexity and the nature of its operations. Such a program must include “reasonable policies and procedures” to achieve the following: We provide m We more condominium re-roofing than any other company in Greater Boston. re-ro oofing com mpany Boston n. Asphalt Shingles Rubber Roofing Repairs & Re-roofing Metal Roofing Gutters & Downspouts Our Company Pledge: We will call you back on the same day. Manufacturer trained installers ensure correct installations. First class professionalism and clean-up. Licensed and insured in MA & CT. We work closely with Property Managers and Engineers to identify the most cost-effective roofing solution for your association. For the past twenty years, our mission has been to provide the best installed roofing systems and superior service for the greater Boston area. We are certified by all major roofing manufacturers. We regard excellent customer relations as an essential part of our full-service roofing company. Expect our production crews to be reliable, and our twenty-four hour emergency repair crews to be proficient in troubleshooting hard-to-find leaks. — Shawn Bryan, President. Member since 1998 Member since 617 244-990 244 617-244-9901 617-244 990 617-244-9901 www.newtonroofing.com www.new wtonroofing.com MA LIC# 111908 L CONDO MEDIA • JANUARY 2010

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Condo Media - January 2010

Table of Contents for the Digital Edition of Condo Media - January 2010