WYND Wyndham Destinations Inc

Wyndham Worldwide Corp. will establish a comprehensive information-security program to protect cardholder data to settle Federal Trade Commission charges that Wyndham's security practices unfairly exposed information of hundreds of thousands of consumers to hackers in three separate data breaches, according to the FTC.

Wyndham said Wednesday it was glad to reach the settlement—which also requires the hotels and resorts chain to conduct annual information-security audits and maintain safeguards with its franchisees' servers. The settlement doesn't hold the company liable for any violations or require it to pay any monetary relief.

"We chose to defend against this litigation based on our strong belief that we have had reasonable data security in place, and that the FTC's position could have had a negative impact on the franchise business model," the company said in a statement.

Wyndham said the settlement sets a standard for what the government considers reasonable data security of payment-card information and added that safeguarding personal information remains a top priority "at a time when companies and government agencies are increasingly the targets of cyberattacks."

The settlement closes the FTC's federal suit started in 2012. In August, the Third Circuit Court of Appeals ruled the FTC could proceed with the suit, in a decision bolstering the commission's power to police corporate cybersecurity at a time when Congress hasn't passed comprehensive data-security legislation.

The court order requires Wyndham to obtain yearly security audits in line with the Payment Card Industry Data Security Standard.

It also stipulates that if Wyndham suffers another breach affecting more than 10,000 payment card numbers, it must obtain an assessment and submit it to the FTC within 10 days.

Write to Anne Steele at Anne.Steele@wsj.com

(END) Dow Jones Newswires

December 09, 2015 12:35 ET (17:35 GMT)

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