A Kansas title insurer settled a lawsuit with the Federal Trade Commission in which the company was accused of faulty data security practices including tossing consumer home loan applications into an open Dumpster, the FTC said Wednesday.
The FTC settlement with Nations Title Agency Inc., Nations Holding Co. and Christopher M. Likens bars deceptive claims about privacy and security policies, and requires that the company implement a comprehensive information security program and obtain audits by an independent third-party security professional every other year for 20 years, the FTC said.
Messages left with Kurt Mcley, an attorney in the legal department at Nations, seeking comment were not answered by press time.
According to the FTC, Kansas City, Kan.-based Nations Holding Co. promised consumers it maintained “physical, electronic and procedural safeguards” to protect their confidential financial information, but “tossed consumer home loan applications in an open dumpster,” the FTC said in a statement.
The company agreed to settle the FTC’s accusations that its allegedly inadequate storage and disposal procedures for sensitive consumer information violated federal laws, the FTC said.
NHC is a privately held holding company that provides real estate services in 44 states, the FTC said. Its subsidiary, NTA, provides a variety of services in connection with financing home purchases and refinancing existing home mortgages. Likens is the president and sole owner of NHC and its subsidiaries, the FTC said.
According to the FTC’s complaint, NHC, NTA and Likens routinely obtain sensitive consumer information from banks, real estate brokers, consumers, and public records that include such things as consumer names, Social Security numbers, bank and credit card account numbers, and credit histories.
The FTC alleged that NHC, NTA and Likens engaged in a number of practices that, taken together, failed to provide reasonable and appropriate security to protect the information.