DealerBuilt/LightYear Dealer Technologies; Analysis To Aid Public Comment |
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Topics: DealerBuilt
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April J. Tabor
Federal Trade Commission
17 June 2019
[Federal Register Volume 84, Number 116 (Monday, June 17, 2019)]
[Notices]
[Pages 28054-28056]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-12768]
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FEDERAL TRADE COMMISSION
[File No. 172 3051]
DealerBuilt/LightYear Dealer Technologies; Analysis To Aid Public
Comment
AGENCY: Federal Trade Commission.
ACTION: Proposed consent agreement; request for comment.
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SUMMARY: The consent agreement in this matter settles alleged
violations of federal law prohibiting unfair or deceptive acts or
practices. The attached Analysis to Aid Public Comment describes both
the allegations in the complaint and the terms of the consent order--
embodied in the consent agreement--that would settle these allegations.
DATES: Comments must be received on or before July 17, 2019.
ADDRESSES: Interested parties may file comments online or on paper, by
following the instructions in the Request for Comment part of the
SUPPLEMENTARY INFORMATION section below. Write: ``DealerBuilt/LightYear
Dealer Technologies; File No. 172 3051'' on your comment, and file your
comment online at https://www.regulations.gov by following the
instructions on the web-based form. If you prefer to file your comment
on paper, mail your comment to the following address: Federal Trade
Commission, Office of the Secretary, 600 Pennsylvania Avenue NW, Suite
CC-5610 (Annex D), Washington, DC 20580, or deliver your comment to the
following address: Federal Trade Commission, Office of the Secretary,
Constitution Center, 400 7th Street SW, 5th Floor, Suite 5610 (Annex
D), Washington, DC 20024.
FOR FURTHER INFORMATION CONTACT: Jamie Hine (202-326-2188), Bureau of
Consumer Protection, Federal Trade Commission, 600 Pennsylvania Avenue
NW, Washington, DC 20580.
SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal
Trade Commission Act, 15 U.S.C. 46(f), and FTC Rule 2.34, 16 CFR 2.34,
notice is hereby given that the above-captioned consent agreement
containing a consent order to cease and desist, having been filed with
and accepted, subject to final approval, by the Commission, has been
placed on the public record for a period of thirty (30) days. The
following Analysis to Aid Public Comment describes the terms of the
consent agreement and the allegations in the complaint. An electronic
copy of the full text of the consent agreement package can be obtained
from the FTC Home Page (for June 12, 2019), on the World Wide Web, at
https://www.ftc.gov/news-events/commission-actions.
You can file a comment online or on paper. For the Commission to
consider your comment, we must receive it on or before July 17, 2019.
Write ``DealerBuilt/LightYear Dealer Technologies; File No. 172 3051''
on your comment. Your comment--including your name and your state--will
be placed on the public record of this proceeding, including, to the
extent practicable, on the https://www.regulations.gov website.
Postal mail addressed to the Commission is subject to delay due to
heightened security screening. As a result, we encourage you to submit
your comments online through the https://www.regulations.gov website.
If you prefer to file your comment on paper, write ``DealerBuilt/
LightYear Dealer Technologies; File No. 172 3051'' on your comment and
on the envelope, and mail your comment to the following address:
Federal Trade Commission, Office of the Secretary, 600 Pennsylvania
Avenue NW, Suite CC-5610 (Annex D), Washington, DC 20580; or deliver
your comment to the following address: Federal Trade Commission, Office
of the Secretary, Constitution Center, 400 7th Street SW, 5th Floor,
Suite 5610 (Annex D), Washington, DC 20024. If possible, submit your
paper comment to the Commission by courier or overnight service.
[[Page 28055]]
Because your comment will be placed on the publicly accessible
website at https://www.regulations.gov, you are solely responsible for
making sure that your comment does not include any sensitive or
confidential information. In particular, your comment should not
include any sensitive personal information, such as your or anyone
else's Social Security number; date of birth; driver's license number
or other state identification number, or foreign country equivalent;
passport number; financial account number; or credit or debit card
number. You are also solely responsible for making sure that your
comment does not include any sensitive health information, such as
medical records or other individually identifiable health information.
In addition, your comment should not include any ``trade secret or any
commercial or financial information which . . . is privileged or
confidential''--as provided by Section 6(f) of the FTC Act, 15 U.S.C.
46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2)--including in
particular competitively sensitive information such as costs, sales
statistics, inventories, formulas, patterns, devices, manufacturing
processes, or customer names.
Comments containing material for which confidential treatment is
requested must be filed in paper form, must be clearly labeled
``Confidential,'' and must comply with FTC Rule 4.9(c). In particular,
the written request for confidential treatment that accompanies the
comment must include the factual and legal basis for the request, and
must identify the specific portions of the comment to be withheld from
the public record. See FTC Rule 4.9(c). Your comment will be kept
confidential only if the General Counsel grants your request in
accordance with the law and the public interest. Once your comment has
been posted on the public FTC website--as legally required by FTC Rule
4.9(b)--we cannot redact or remove your comment from the FTC website,
unless you submit a confidentiality request that meets the requirements
for such treatment under FTC Rule 4.9(c), and the General Counsel
grants that request.
Visit the FTC website at http://www.ftc.gov to read this Notice and
the news release describing it. The FTC Act and other laws that the
Commission administers permit the collection of public comments to
consider and use in this proceeding, as appropriate. The Commission
will consider all timely and responsive public comments that it
receives on or before July 17, 2019. For information on the
Commission's privacy policy, including routine uses permitted by the
Privacy Act, see https://www.ftc.gov/site-information/privacy-policy.
Analysis of Proposed Consent Order To Aid Public Comment
The Federal Trade Commission (``Commission'') has accepted, subject
to final approval, an agreement containing a consent order from
LightYear Dealer Technologies, LLC, also doing business as DealerBuilt
(``Respondent'').
The proposed consent order (``proposed order'') has been placed on
the public record for thirty (30) days for receipt of comments by
interested persons. Comments received during this period will become
part of the public record. After thirty (30) days, the Commission will
again review the agreement and the comments received, and will decide
whether it should withdraw from the agreement and take appropriate
action or make final the agreement's proposed order.
This matter involves DealerBuilt (``DealerBuilt''), a technology
company that develops and sells dealer management system software and
data processing services to automotive dealerships nationwide.
Respondent has stored personal information about more than 14 million
consumers.
The Commission's proposed two-count complaint alleges that
Respondent has violated Section 5(a) of the Federal Trade Commission
Act and the Standards for Safeguarding Customer Information Rule
(``Safeguards Rule''), issued pursuant to Title I of the Gramm-Leach-
Bliley Act (``GLB'').
First, the proposed complaint alleges that Respondent has engaged
in a number of unreasonable security practices that led to a hacker's
unauthorized access of personal information belonging to about 12.5
million consumers. During that breach, the hacker also downloaded the
personal information of approximately 70,000 consumers, which was
contained in the back-up directories of five DealerBuilt customers. The
proposed complaint alleges that Respondent:
Failed to develop, implement, or maintain a written
organizational information security policy;
failed to implement reasonable guidance or training for
employees or third-party contractors, regarding data security and
safeguarding consumers' personal information;
failed to assess the risks to the personal information
stored on its network, such as by conducting periodic risk assessments
or performing vulnerability and penetration testing of the network;
failed to use readily available security measures to
monitor its systems and assets at discrete intervals to identify data
security events (e.g., unauthorized attempts to exfiltrate consumers'
personal information across the company's network) and verify the
effectiveness of protective measures;
failed to impose reasonable data access controls, such as
restricting inbound connections to known IP addresses, and requiring
authentication to access backup databases;
stored consumers' personal information on Respondent's
computer network in clear text; and
failed to have a reasonable process to select, install,
secure, and inventory devices with access to personal information.
The proposed complaint alleges that Respondent could have addressed
each of the failures described above by implementing readily available
and relatively low-cost security measures.
The proposed complaint alleges that Respondent's failures caused or
are likely to cause substantial injury to consumers that is not
outweighed by countervailing benefits to consumers or competition and
is not reasonably avoidable by consumers themselves. Such practices
constitute an unfair act or practice under Section 5 of the FTC Act.
Second, the proposed complaint alleges that Respondent violated the
Safeguards Rule, which requires financial institutions to protect the
security, confidentiality, and integrity of customer information by
developing, implementing, and maintaining a comprehensive information
security program that is written in one or more readily accessible
parts, and that contains administrative, technical, and physical
safeguards that are appropriate to the financial institution's size and
complexity, the nature and scope of its activities, and the sensitivity
of the customer information at issue. The proposed complaint alleges
that Respondent:
Failed to develop, implement, and maintain a written
information security program;
failed to identify reasonably foreseeable internal and
external risks to the security, confidentiality, and integrity of
customer information and failed to assess the sufficiency of any
safeguards in place to control those risks; and
failed to design and implement basic safeguards and to
regularly test or otherwise monitor the effectiveness of such
safeguards' key controls, systems, and procedures.
[[Page 28056]]
The proposed order contains injunctive provisions addressing the
alleged unfair conduct in connection with Respondent's sale of dealer
management system software and services. Part I of the proposed order
prohibits Respondent, and any business that Respondent controls
directly, or indirectly, from transferring, selling, sharing,
collecting, maintaining, or storing personal information unless it
establishes and implements, and thereafter maintains, a comprehensive
information security program that protects the security,
confidentiality, and integrity of such personal information.
Part II of the proposed order requires Respondent to obtain initial
and biennial data security assessments for twenty years.
Part III of the agreement requires Respondent to disclose all
material facts to the assessor and prohibits Respondent from
misrepresenting any fact material to the assessments required by Part
II.
Part IV requires Respondent to submit an annual certification from
a senior corporate manager (or senior officer responsible for its
information security program) that Respondent has implemented the
requirements of the Order, is not aware of any material noncompliance
that has not been corrected or disclosed to the Commission, and
includes a brief description of any covered incident involving
unauthorized access to or acquisition of personal information.
Part V requires Respondent to submit a report to the Commission of
its discovery of any covered incident.
Part VI is a prohibition against violating GLB.
Parts VII through X of the proposed order are reporting and
compliance provisions, which include recordkeeping requirements and
provisions requiring Respondent to provide information or documents
necessary for the Commission to monitor compliance. Part XI states that
the proposed order will remain in effect for 20 years, with certain
exceptions.
The purpose of this analysis is to aid public comment on the
proposed order. It is not intended to constitute an official
interpretation of the complaint or proposed order, or to modify in any
way the proposed order's terms.
By direction of the Commission.
April J. Tabor,
Acting Secretary.
[FR Doc. 2019-12768 Filed 6-14-19; 8:45 am]
BILLING CODE 6750-01-P