Calif.'s Harris Outlines ‘Reasonable'Data Security

Bloomberg Law: Privacy & Data Security brings you single-source access to the expertise of Bloomberg Law’s privacy and data security editorial team, contributing practitioners,...

By Joyce E. Cutler

Feb. 17 — California Attorney General Kamala Harris (D) has released the state's data breach report, laying out the legal and ethical responsibilities of businesses to keep information safe and perhaps most importantly outlining what the state believes is “reasonable security” that companies must employ to avoid possible enforcement actions.

Under the state's information security statute, businesses must use “reasonable security procedures and practices” that “protect personal information from unauthorized access, destruction, use, modification, or disclosure,” the report said.

Under the guidelines in the report released Feb. 16, failing to implement all 20 of the Center for Internet Security’s Critical Security Controls that apply to an organization’s environment constitutes a lack of reasonable security. The controls define a minimum level of information security all organizations that collect or maintain personal information should meet.

Attorney General Harris is “going to start bringing cases under the state's data security statute,” Chris Jay Hoofnagle adjunct professor at the University of California, Berkley, School of Information & School of Law and member of the advisory board of Bloomberg BNA's Privacy & Data Security Law Report, told Bloomberg BNA Feb. 17.

Clarifying the “reasonable security” standard “is the first step in the process,” Hoofnagle said.

Report Recommendations

Among the report’s recommendations are swiftly patching vulnerabilities, using strong encryption, having multi-factor authentication on consumer-facing online accounts that contain sensitive personal information and adopting helpful user-centered policies.

Looking at the public health model “tells us quite well how to deal with an epidemic,” and that’s prevention, Harris told a Stanford University audience Feb. 16.

The data breach report as much as anything is designed to be a tool to help industry “avoid breaking the law by violating individuals’ privacy,” she said.

“Underlying this issue is this fact: businesses now, because of the technology and the way it exists and what it can do, are in possession of an incredibly large amount of other people’s private information in a way they weren’t necessarily before. And there then should be a responsibility to do everything they can to ensure that private information is kept safe,” Harris said.

Malware and Hacking Rising

Malware and hacking rose 22 percent in four years, representing 365 of all breaches. Malware and hacking breached 44.6 million records, or 90 percent of records affected. “Exponentially more consumers are being impacted,” Harris said.

“The majority of these breaches occurred and resulted from security failures, and in all of them, the exploited vulnerabilities that enabled these breaches were compromised over a year after the solution to patch the vulnerability was publicly available,” Harris said.

Working with Businesses, Other States

California—the first state to pass a data breach notification law—can work with other states, the report said.

“State policy makers should collaborate to harmonize state breach laws on some key dimensions. Such an effort could reduce the compliance burden for companies, while preserving innovation, maintaining consumer protections, and retaining jurisdictional expertise,” the report said.

Harris pointed to her office’s action against Houzz Inc., which last fall agreed to pay $175,000 and designate a chief privacy officer to settle California charges the site illegally recorded telephone calls in violation of state privacy laws .

The fix “can be broader than just enforcement and punishment,” Harris said.

Collaboration likewise can result in positives for business, consumer and government, she said. Google Inc., Amazon Inc., Microsoft Corp. and Apple Inc. were among the companies that worked with the AG to create mobile privacy policy guidance targeted for application developers .

By Joyce E. Cutler

To contact the reporter on this story: Joyce E. Cutler in San Francisco at jcutler@bna.com.

To contact the editor responsible for this story: Daniel R. Stoller at dstoller@bna.com

For More Information

Full text of the “California Data Breach Report: 2012-2015” is available at http://src.bna.com/cFY.