[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]


=======================================================================
-----------------------------------------------------------------------

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.

-----------------------------------------------------------------------

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