Cybersecurity compliance for regulated firms in Tennessee

Three parts

What a complete answer covers in Tennessee

In Tennessee, different licenses are overseen by different regulators. Where a rule below applies to one kind of firm, the text says so.

• The federal minimum. The FTC Safeguards Rule (16 CFR 314) treats a wide range of nonbank businesses as financial institutions, including mortgage lenders and servicers, consumer finance companies, tax preparers, collection firms, title and settlement agents, money services businesses, and dealers that arrange financing. A firm within its reach must keep a written security program, appoint a qualified individual to run it, and report to its board each year. Insurance producers and investment advisers fall outside the FTC's jurisdiction and answer to their own regulators, and banks and credit unions answer to their prudential regulators under the interagency information-security guidelines. Which side of that line a firm falls on depends on what it does and who supervises it.
• What a license adds in Tennessee. Conditions attach to whatever a firm is licensed or registered to do, and they differ widely from one type of license to another. Mortgage is the area where most of our work lies, and in Tennessee mortgage licensing is overseen by the Tennessee Department of Financial Institutions. Tennessee licenses servicers by name. Under the Tennessee Residential Lending, Brokerage and Servicing Act (Tenn. Code Ann. § 45-13-101 et seq.), no person may act as a mortgage lender, mortgage loan broker or mortgage loan servicer without a license from the Department of Financial Institutions (§ 45-13-201), obtained through NMLS. Mortgage loan servicers also carry a dedicated $200,000 surety bond under § 45-13-206(d). Other licenses are overseen by other regulators and carry conditions of their own.
• What Tennessee law says about protecting data. Tennessee's comprehensive privacy law, the Tennessee Information Protection Act, requires covered controllers to maintain reasonable administrative, technical and physical data-security practices (Tenn. Code Ann. § 47-18-3301 et seq., effective July 1, 2025). It exempts GLBA financial institutions, so most mortgage companies answer to federal safeguards standards rather than a Tennessee one.
• Your counterparties' requirements. Investors, warehouse lenders, carriers, underwriters and institutional clients send questionnaires of their own, and their reviews decide whether a relationship continues. Add the laws of each state where your customers live, and that is the list a firm has to answer. Our assessment begins by producing it, matched to your firm and with each source cited.

Also relevant in Tennessee: Tennessee sets a firm statutory deadline: breach notice to affected residents is due within 45 days of discovery, and an incident involving more than 1,000 Tennesseans also requires notice to the nationwide consumer reporting agencies without unreasonable delay.

General information, not legal advice. Which of these requirements reach your firm depends on its circumstances. The assessment answers that question and names the source of each finding.