BJ's Wholesale Club, Inc.; Analysis of Proposed Consent Order To Aid Public Comment, 36939-36941 [05-12631]

Download as PDF Federal Register / Vol. 70, No. 122 / Monday, June 27, 2005 / Notices Closed Session • Report on System Performance (with discussion of 2004 results of Dynamic Capital Adequacy Test) Open Session A. Approval of Minutes • March 21, 2005 (Regular Meeting) B. Reports • Financials • Report on Insured Obligations • Quarterly Report on Annual Performance Plan C. New Business • Mid-Year Review of Insurance Premium Rates Dated: June 21, 2005. Jeanette C. Brinkley, Secretary, Farm Credit System Insurance Corporation Board. [FR Doc. 05–12661 Filed 6–24–05; 8:45 am] BILLING CODE 6710–01–P FEDERAL MARITIME COMMISSION [Docket No. 05–03] American Warehousing of New York, Inc. v. the Port Authority of New York and New Jersey; Notice of Filing of Complaint and Assignment Notice is given that a complaint has been filed by American Warehousing of New York, Inc. (‘‘Complainant’’) against the Port Authority of New York and New Jersey (‘‘Respondent’’). Complainant contends that Respondent has violated, and continues to violate sections 10(d)(1), 10(d)(3) 10(d)(4), 10(b)(10) and 10(b)(13) of the Act, 46 U.S.C. App. 1709(d)(1), 1709(d)(3), 1709(b)(4), 1709(b)(10) and 1709(b)(13), respectively. Specifically, the Complainant alleges that the Respondent has not provided any material or reasonable justification for its actions (i) in hampering operations at American Warehousing, (ii) delaying and/or denying berths to ships at American Warehousing, (iii) in its campaign to convince American Warehousing clients to take their business elsewhere, and (iv) its attempts to double the rent at Pier 7, and (v) engaging in various discriminatory, retaliatory or irrational behavior. As a direct result of these allegations, Complainant claims that Respondent’s actions have given American Warehousing’s competitors in other terminals and geographic locations an unfair advantage in that they are able to conduct business in the New York-New Jersey area more efficiently because the Respondent is not harassing them or their clients. Complainant seeks an order directing Respondent to cease all VerDate jul<14>2003 18:11 Jun 24, 2005 Jkt 205001 36939 actions to terminate Complainant’s leasehold relationship with Respondent; cease all actions designed to harass, intimidate and delay the operations of the Complainant; establish and put in force such practices as the Commission determines to be lawful and reasonable; provide other relief the Commission may determine to be proper as reward or reparation; and take any other action the Commission determines to be appropriate. This proceeding has been assigned to the Office of Administrative Law Judges. Hearing in this matter, if any is held, shall commence within the time limitations prescribed in 46 CFR 502.61, and only after consideration has been given by the parties and the presiding officer to the use of alternative forms of dispute resolution. The hearing shall include oral testimony and crossexamination in the discretion of the presiding officer only upon proper showing that there are genuine issues of material fact that cannot be resolved on the basis of sworn statements, affidavits, depositions, or other documents or that the nature of the matter in issue is such that an oral hearing and crossexamination are necessary for the development of an adequate record. Pursuant to the further terms of 46 CFR 502.61, the initial decision of the presiding officer in this proceeding shall be issued by June 21, 2006, and the final decision of the Commission shall be issued by October 19, 2006. Bryant L. VanBrakle, Secretary. [FR Doc. 05–12640 Filed 6–24–05; 8:45 am] available for inspection at the offices of the Board of Governors. Interested persons may express their views in writing on the standards enumerated in the BHC Act (12 U.S.C. 1842(c)). If the proposal also involves the acquisition of a nonbanking company, the review also includes whether the acquisition of the nonbanking company complies with the standards in section 4 of the BHC Act (12 U.S.C. 1843). Unless otherwise noted, nonbanking activities will be conducted throughout the United States. Additional information on all bank holding companies may be obtained from the National Information Center website at www.ffiec.gov/nic/. Unless otherwise noted, comments regarding each of these applications must be received at the Reserve Bank indicated or the offices of the Board of Governors not later than July 18, 2005. A. Federal Reserve Bank of Atlanta (Andre Anderson, Vice President) 1000 Peachtree Street, N.E., Atlanta, Georgia 30303: 1. First Security Group, Inc., Chattanooga, Tennessee; to acquire Jackson Bank and Trust, Gainesboro, Tennessee. B. Federal Reserve Bank of Chicago (Patrick M. Wilder, Assistant Vice President) 230 South LaSalle Street, Chicago, Illinois 60690-1414: 1. Clarkston Financial Corporation, Clarkston, Michigan; to acquire not less than 51 percent of the voting shares of Huron Valley State Bank, Milford, Michigan (in organization). Board of Governors of the Federal Reserve System, June 20, 2005. BILLING CODE 6730–01–P FEDERAL RESERVE SYSTEM Formations of, Acquisitions by, and Mergers of Bank Holding Companies The companies listed in this notice have applied to the Board for approval, pursuant to the Bank Holding Company Act of 1956 (12 U.S.C. 1841 et seq.) (BHC Act), Regulation Y (12 CFR Part 225), and all other applicable statutes and regulations to become a bank holding company and/or to acquire the assets or the ownership of, control of, or the power to vote shares of a bank or bank holding company and all of the banks and nonbanking companies owned by the bank holding company, including the companies listed below. The applications listed below, as well as other related filings required by the Board, are available for immediate inspection at the Federal Reserve Bank indicated. The application also will be PO 00000 Frm 00024 Fmt 4703 Sfmt 4703 Robert deV. Frierson, Deputy Secretary of the Board. [FR Doc. 05–12496 Filed 6–24–05; 8:45 am] BILLING CODE 6210–01–S FEDERAL TRADE COMMISSION [File No. 042 3160] BJ’s Wholesale Club, Inc.; Analysis of Proposed Consent Order To Aid Public Comment Federal Trade Commission. Proposed consent agreement. AGENCY: ACTION: SUMMARY: The consent agreement in this matter settles alleged violations of federal law prohibiting unfair or deceptive acts or practices or unfair methods of competition. The attached Analysis to Aid Public Comment describes both the allegations in the draft complaint and the terms of the consent order—embodied in the consent agreement—that would settle these allegations. E:\FR\FM\27JNN1.SGM 27JNN1 36940 Federal Register / Vol. 70, No. 122 / Monday, June 27, 2005 / Notices Comments must be received on or before July 16, 2005. ADDRESSES: Interested parties are invited to submit written comments. Comments should refer to ‘‘BJ’s Wholesale Club, Inc., File No. 042 3160,’’ to facilitate the organization of comments. A comment filed in paper form should include this reference both in the text and on the envelope, and should be mailed or delivered to the following address: Federal Trade Commission/Office of the Secretary, Room 159–H, 600 Pennsylvania Avenue, NW., Washington, DC 20580. Comments containing confidential material must be filed in paper form, must be clearly labeled ‘‘Confidential,’’ and must comply with Commission Rule 4.9(c). 16 CFR 4.9(c) (2005).1 The FTC is requesting that any comment filed in paper form be sent by courier or overnight service, if possible, because U.S. postal mail in the Washington area and at the Commission is subject to delay due to heightened security precautions. Comments that do not contain any nonpublic information may instead be filed in electronic form as part of or as an attachment to e-mail messages directed to the following email box: consentagreement@ftc.gov. The FTC Act and other laws the Commission administers permit the collection of public comments to consider and use in this proceeding as appropriate. All timely and responsive public comments, whether filed in paper or electronic form, will be considered by the Commission, and will be available to the public on the FTC Web site, to the extent practicable, at https://www.ftc.gov. As a matter of discretion, the FTC makes every effort to remove home contact information for individuals from the public comments it receives before placing those comments on the FTC Web site. More information, including routine uses permitted by the Privacy Act, may be found in the FTC’s privacy policy, at https://www.ftc.gov/ ftc/privacy.htm. FOR FURTHER INFORMATION CONTACT: Joel Winston, Bureau of Consumer Protection, 600 Pennsylvania Avenue, NW., Washington, DC 20580, (202) 326– 3224. SUPPLEMENTARY INFORMATION: Pursuant to section 6(f) of the Federal Trade Commission Act, 38 Stat. 721, 15 U.S.C. DATES: 1 The comment must be accompanied by an explicit request for confidential treatment, including the factual and legal basis for the request, and must identify the specific portions of the comment to be withheld from the public record. The request will be granted or denied by the Commission’s General Counsel, consistent with applicable law and the public interest. See Commission Rule 4.9(c), 16 CFR 4.9(c). VerDate jul<14>2003 18:11 Jun 24, 2005 Jkt 205001 46(f), and § 2.34 of the Commission Rules of Practice, 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 16, 2005), on the World Wide Web, at https://www.ftc.gov/ os/2005/06/index.htm. A paper copy can be obtained from the FTC Public Reference Room, Room 130–H, 600 Pennsylvania Avenue, NW., Washington, DC 20580, either in person or by calling (202) 326–2222. Public comments are invited, and may be filed with the Commission in either paper or electronic form. All comments should be filed as prescribed in the ADDRESSES section above, and must be received on or before the date specified in the DATES section. Analysis of Agreement Containing Consent Order To Aid Public Comment The Federal Trade Commission has accepted, subject to final approval, a consent agreement from BJ’s Wholesale Club, Inc. (‘‘BJ’s’’). The consent agreement 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. BJ’s operates about 150 warehouse clubs (‘‘stores’’) in 16 eastern states. BJ’s is a membership club with about 8 million current members. Members often use credit and debit cards to pay for their purchases at BJ’s. In the course of seeking approval for these credit and debit card purchases, BJ’s collected members’ personal information, including card number and expiration date and other information, from magnetic stripes on the cards. The Commission’s proposed complaint alleges that BJ’s stored members’ personal information on computers at its stores and failed to employ reasonable and appropriate security measures to protect the information. The complaint alleges that this failure was an unfair practice PO 00000 Frm 00025 Fmt 4703 Sfmt 4703 because it caused or was likely to cause substantial consumer injury that was not reasonably avoidable and was not outweighed by countervailing benefits to consumers or competition. In particular, the complaint alleges that BJ’s engaged in a number of practices which, taken together, did not provide reasonable security for sensitive personal information, including: (1) Failing to encrypt information collected in its stores while the information was in transit or stored on BJ’s computer networks; (2) storing the information in files that could be accessed anonymously, that is, using a commonly known default user id and password; (3) failing to use readily available security measures to limit access to its networks through wireless access points on the networks; (4) failing to employ measures sufficient to detect unauthorized access to the networks or conduct security investigations; and (5) storing information for up to 30 days when BJ’s no longer had a business need to keep the information, in violation of bank security rules. The complaint further alleges that several million dollars in fraudulent purchases were made using counterfeit copies of credit and debit cards members had used at BJ’s stores. The counterfeit cards contained the same personal information BJ’s had collected from the magnetic stripes of members’ credit and debit cards and then stored on its computer networks. After discovering the fraudulent purchases, banks cancelled and re-issued thousands of credit and debit cards members had used at BJ’s stores, and members holding these cards were unable to use them to access credit and their own bank accounts. The proposed order applies to personal information from or about consumers BJ’s collects in connection with its business. It contains provisions designed to prevent BJ’s from engaging in the future in practices similar to those alleged in the complaint. Specifically, Part I of the proposed order requires BJ’s to establish and maintain a comprehensive information security program in writing that is reasonably designed to protect the security, confidentiality, and integrity of personal information it collects from or about consumers. The security program must contain administrative, technical, and physical safeguards appropriate to BJ’s size and complexity, the nature and scope of its activities, and the sensitivity of the personal information collected. Specifically, the order requires BJ’s to: • Designate an employee or employees to coordinate and be E:\FR\FM\27JNN1.SGM 27JNN1 36941 Federal Register / Vol. 70, No. 122 / Monday, June 27, 2005 / Notices accountable for the information security program. • Identify material internal and external risks to the security, confidentiality, and integrity of consumer information that could result in unauthorized disclosure, misuse, loss, alteration, destruction, or other compromise of such information, and assess the sufficiency of any safeguards in place to control these risks. • Design and implement reasonable safeguards to control the risks identified through risk assessment, and regularly test or monitor the effectiveness of the safeguards’ key controls, systems, and procedures. • Evaluate and adjust its information security program in light of the results of testing and monitoring, any material changes to its operations or business arrangements, or any other circumstances that BJ’s knows or has to reason to know may have a material impact on the effectiveness of its information security program. Part II of the proposed order requires that BJ’s obtain within 180 days, and on a biennial basis thereafter, an assessment and report from a qualified, objective, independent third-party professional, certifying, among other things, that: (1) BJ’s has in place a security program that provides protections that meet or exceed the protections required by Part I of the proposed order, and (2) BJ’s security program is operating with sufficient effectiveness to provide reasonable assurance that the security, confidentiality, and integrity of consumers’ personal information has been protected. Parts III through VII of the proposed order are reporting and compliance provisions. Part III requires BJ’s to retain documents relating to its compliance with the order. Part IV requires dissemination of the order now and in the future to persons with responsibilities relating to the subject matter of the order. Part V requires BJ’s to notify the Commission of changes in BJ’s corporate status. Part VI mandates that BJ’s submit compliance reports to the FTC. Part VII is a provision ‘‘sunsetting’’ the order after twenty (20) years, with certain exceptions. The purpose of this analysis is to facilitate public comment on the proposed order. It is not intended to constitute an official interpretation of the proposed order to modify its terms in any way. By direction of the Commission. Donald S. Clark, Secretary. [FR Doc. 05–12631 Filed 6–24–05; 8:45 am] DEPARTMENT OF HEALTH AND HUMAN SERVICES Administration for Children and Families Submission for OMB Review; Comment Request Proposed Projects Title: State- and Local-Level Questionnaire for Project on Collection of Marriage and Divorce Statistics at the National, State and Local Levels. OMB No.: New Collection. Description: The Administration for Children and Families and the Office of the Assistant Secretary for Planning and Evaluation in the Department of Health and Human Services propose a study to explore options for the collection of marriage and divorce statistics at the national, state and local levels. The project will include the administering of a questionnaire to state- and local-level officials involved in the reporting and compilation of marriage and divorce vital records. Respondents: State and local governments, including court officials. Annual burden Estimates: BILLING CODE 6750–01–P Instrument Number of respondents Number of responses per respondent Average per response burden hours Total burden hours Marriage/Divorce Vital Statistics Data Systems State-level Survey ................ Marriage/Divorce .............................................................................................. Vital Statistics Data Systems Local-level Survey ............................................ 50 195 ........................ 1 1 ........................ 1.17 0.92 ........................ 58.30 178.75 ........................ Estimated Total Annual Burden Hour: Additional Information: Copies of the proposed collection may be obtained by writing to the Administration for Children and Families, Office of Administration, Office of Information Services, 370 L’Enfant Promenade, SW., Washington, DC 20447, Attn: ACF Reports Clearance Officer. All requests should be identified by the title of the information collection. E-mail address: grjohnson@acf.hhs.gov. OMB Comment: OMB is required to make a decision concerning the collection of information between 30 and 60 days after publication of this document in the Federal Register. Therefore, a comment is best assured of having its full effect if OMB receives it within 30 days of publication. Written comments and recommendations for the proposed information collection should be sent directly to the following: Office of Management and Budget, Paperwork VerDate jul<14>2003 18:11 Jun 24, 2005 Jkt 205001 Reduction Project, Attn: Desk Officer for ACF, E-mail address: Katherine_T._Astrich@omb.eop.gov. Dated: June 20, 2005. Robert Sargis, Reports Clearance Officer. [FR Doc. 05–12642 Filed 6–24–05; 8:45 am] BILLING CODE 4184–01–M DEPARTMENT OF HOMELAND SECURITY Office of the Secretary [Docket No. DHS–2005–0043] Open Meeting of National Infrastructure Advisory Council (NIAC) Directorate of Information Analysis and Infrastructure Protection, DHS. ACTION: Notice of meeting. AGENCY: PO 00000 Frm 00026 Fmt 4703 Sfmt 4703 SUMMARY: The National Infrastructure Advisory Council (NIAC) will meet on Tuesday, July 12, 2005, from 1:30 p.m. to 4:30 p.m. at the National Press Club in Washington DC. The meeting will be open to the public. Limited seating will be available. Reservations are not accepted. The NIAC advises the President of the United States on the security of critical infrastructures which include banking and finance, transportation, energy, manufacturing, and emergency government services. At this meeting, the NIAC will be briefed on the status of several Working Group activities in which the Council is currently engaged. DATES: The National Infrastructure Advisory Council (NIAC) will meet on Tuesday, July 12, 2005, from 1:30 p.m. to 4:30 p.m. at the National Press Club in Washington DC. ADDRESSES: The NIAC will meet at the National Press Club, 529 14th Street, E:\FR\FM\27JNN1.SGM 27JNN1

Agencies

[Federal Register Volume 70, Number 122 (Monday, June 27, 2005)]
[Notices]
[Pages 36939-36941]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 05-12631]


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

FEDERAL TRADE COMMISSION

[File No. 042 3160]


BJ's Wholesale Club, Inc.; Analysis of Proposed Consent Order To 
Aid Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed consent agreement.

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

SUMMARY: The consent agreement in this matter settles alleged 
violations of federal law prohibiting unfair or deceptive acts or 
practices or unfair methods of competition. The attached Analysis to 
Aid Public Comment describes both the allegations in the draft 
complaint and the terms of the consent order--embodied in the consent 
agreement--that would settle these allegations.

[[Page 36940]]


DATES: Comments must be received on or before July 16, 2005.

ADDRESSES: Interested parties are invited to submit written comments. 
Comments should refer to ``BJ's Wholesale Club, Inc., File No. 042 
3160,'' to facilitate the organization of comments. A comment filed in 
paper form should include this reference both in the text and on the 
envelope, and should be mailed or delivered to the following address: 
Federal Trade Commission/Office of the Secretary, Room 159-H, 600 
Pennsylvania Avenue, NW., Washington, DC 20580. Comments containing 
confidential material must be filed in paper form, must be clearly 
labeled ``Confidential,'' and must comply with Commission Rule 4.9(c). 
16 CFR 4.9(c) (2005).\1\ The FTC is requesting that any comment filed 
in paper form be sent by courier or overnight service, if possible, 
because U.S. postal mail in the Washington area and at the Commission 
is subject to delay due to heightened security precautions. Comments 
that do not contain any nonpublic information may instead be filed in 
electronic form as part of or as an attachment to e-mail messages 
directed to the following e-mail box: consentagreement@ftc.gov.
---------------------------------------------------------------------------

    \1\ The comment must be accompanied by an explicit request for 
confidential treatment, including the factual and legal basis for 
the request, and must identify the specific portions of the comment 
to be withheld from the public record. The request will be granted 
or denied by the Commission's General Counsel, consistent with 
applicable law and the public interest. See Commission Rule 4.9(c), 
16 CFR 4.9(c).
---------------------------------------------------------------------------

    The FTC Act and other laws the Commission administers permit the 
collection of public comments to consider and use in this proceeding as 
appropriate. All timely and responsive public comments, whether filed 
in paper or electronic form, will be considered by the Commission, and 
will be available to the public on the FTC Web site, to the extent 
practicable, at https://www.ftc.gov. As a matter of discretion, the FTC 
makes every effort to remove home contact information for individuals 
from the public comments it receives before placing those comments on 
the FTC Web site. More information, including routine uses permitted by 
the Privacy Act, may be found in the FTC's privacy policy, at https://
www.ftc.gov/ftc/privacy.htm.

FOR FURTHER INFORMATION CONTACT: Joel Winston, Bureau of Consumer 
Protection, 600 Pennsylvania Avenue, NW., Washington, DC 20580, (202) 
326-3224.

SUPPLEMENTARY INFORMATION: Pursuant to section 6(f) of the Federal 
Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46(f), and Sec.  2.34 of 
the Commission Rules of Practice, 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 16, 2005), on the World Wide Web, at https://www.ftc.gov/os/
2005/06/index.htm. A paper copy can be obtained from the FTC Public 
Reference Room, Room 130-H, 600 Pennsylvania Avenue, NW., Washington, 
DC 20580, either in person or by calling (202) 326-2222.
    Public comments are invited, and may be filed with the Commission 
in either paper or electronic form. All comments should be filed as 
prescribed in the ADDRESSES section above, and must be received on or 
before the date specified in the DATES section.

Analysis of Agreement Containing Consent Order To Aid Public Comment

    The Federal Trade Commission has accepted, subject to final 
approval, a consent agreement from BJ's Wholesale Club, Inc. 
(``BJ's'').
    The consent agreement 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.
    BJ's operates about 150 warehouse clubs (``stores'') in 16 eastern 
states. BJ's is a membership club with about 8 million current members. 
Members often use credit and debit cards to pay for their purchases at 
BJ's. In the course of seeking approval for these credit and debit card 
purchases, BJ's collected members' personal information, including card 
number and expiration date and other information, from magnetic stripes 
on the cards.
    The Commission's proposed complaint alleges that BJ's stored 
members' personal information on computers at its stores and failed to 
employ reasonable and appropriate security measures to protect the 
information. The complaint alleges that this failure was an unfair 
practice because it caused or was likely to cause substantial consumer 
injury that was not reasonably avoidable and was not outweighed by 
countervailing benefits to consumers or competition. In particular, the 
complaint alleges that BJ's engaged in a number of practices which, 
taken together, did not provide reasonable security for sensitive 
personal information, including: (1) Failing to encrypt information 
collected in its stores while the information was in transit or stored 
on BJ's computer networks; (2) storing the information in files that 
could be accessed anonymously, that is, using a commonly known default 
user id and password; (3) failing to use readily available security 
measures to limit access to its networks through wireless access points 
on the networks; (4) failing to employ measures sufficient to detect 
unauthorized access to the networks or conduct security investigations; 
and (5) storing information for up to 30 days when BJ's no longer had a 
business need to keep the information, in violation of bank security 
rules.
    The complaint further alleges that several million dollars in 
fraudulent purchases were made using counterfeit copies of credit and 
debit cards members had used at BJ's stores. The counterfeit cards 
contained the same personal information BJ's had collected from the 
magnetic stripes of members' credit and debit cards and then stored on 
its computer networks. After discovering the fraudulent purchases, 
banks cancelled and re-issued thousands of credit and debit cards 
members had used at BJ's stores, and members holding these cards were 
unable to use them to access credit and their own bank accounts.
    The proposed order applies to personal information from or about 
consumers BJ's collects in connection with its business. It contains 
provisions designed to prevent BJ's from engaging in the future in 
practices similar to those alleged in the complaint.
    Specifically, Part I of the proposed order requires BJ's to 
establish and maintain a comprehensive information security program in 
writing that is reasonably designed to protect the security, 
confidentiality, and integrity of personal information it collects from 
or about consumers. The security program must contain administrative, 
technical, and physical safeguards appropriate to BJ's size and 
complexity, the nature and scope of its activities, and the sensitivity 
of the personal information collected. Specifically, the order requires 
BJ's to:
     Designate an employee or employees to coordinate and be

[[Page 36941]]

accountable for the information security program.
     Identify material internal and external risks to the 
security, confidentiality, and integrity of consumer information that 
could result in unauthorized disclosure, misuse, loss, alteration, 
destruction, or other compromise of such information, and assess the 
sufficiency of any safeguards in place to control these risks.
     Design and implement reasonable safeguards to control the 
risks identified through risk assessment, and regularly test or monitor 
the effectiveness of the safeguards' key controls, systems, and 
procedures.
     Evaluate and adjust its information security program in 
light of the results of testing and monitoring, any material changes to 
its operations or business arrangements, or any other circumstances 
that BJ's knows or has to reason to know may have a material impact on 
the effectiveness of its information security program.
    Part II of the proposed order requires that BJ's obtain within 180 
days, and on a biennial basis thereafter, an assessment and report from 
a qualified, objective, independent third-party professional, 
certifying, among other things, that: (1) BJ's has in place a security 
program that provides protections that meet or exceed the protections 
required by Part I of the proposed order, and (2) BJ's security program 
is operating with sufficient effectiveness to provide reasonable 
assurance that the security, confidentiality, and integrity of 
consumers' personal information has been protected.
    Parts III through VII of the proposed order are reporting and 
compliance provisions. Part III requires BJ's to retain documents 
relating to its compliance with the order. Part IV requires 
dissemination of the order now and in the future to persons with 
responsibilities relating to the subject matter of the order. Part V 
requires BJ's to notify the Commission of changes in BJ's corporate 
status. Part VI mandates that BJ's submit compliance reports to the 
FTC. Part VII is a provision ``sunsetting'' the order after twenty (20) 
years, with certain exceptions.
    The purpose of this analysis is to facilitate public comment on the 
proposed order. It is not intended to constitute an official 
interpretation of the proposed order to modify its terms in any way.

    By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 05-12631 Filed 6-24-05; 8:45 am]
BILLING CODE 6750-01-P
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