House Committee Explores Small Business Cybersecurity Resources

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By Daniel R. Stoller

Small businesses are prime cybercrime targets, and getting more of them to share cyberthreat data with the government boosts the security of all industries, lawmakers said at a Jan. 30 House hearing.

Small businesses generally have fewer financial and human resources and technical know-how to help mitigate cyberthreats and participate in cybersecurity information threat programs, lawmakers and witnesses said at a House Small Business Committee hearing. Threat sharing allows companies to exchange information on cybersecurity vulnerabilities and potential attacks with the government, industry groups, and each other. Shared data can be used to prevent large-scale cyberattacks and to alert companies of potential technology vulnerabilities before hackers can exploit them.

Lawmakers want to ensure that small businesses have the necessary resources and enough trust in government cyberthreat information sharing programs by providing direct liability protections and encouraging participation in small business development centers that interact with important government agencies, such as the FBI and DHS.

It is imperative for small companies to participate in cyberthreat information sharing programs because 40 percent of all cyberattacks are against small businesses, Ranking Member Nydia Velazquez (D-N.Y.) said in her opening statement. A small business is defined by the Small Business Administration as a company that employs fewer than 500 people. There are over 28 million small businesses in the U.S., which employ over 50 percent of the workforce, according to the SBA.

Small businesses face the same cybersecurity threats as larger companies, but aren’t as equipped to face those threats, Richard Driggers, deputy assistant secretary at the Department of Homeland Security Office of Cybersecurity and Communications, testified at the hearing.

Small business is “under prepared” for cyberattacks, Howard Marshall, deputy assistant director in the FBI’s Cyber Division, told lawmakers.

The government can help small business get necessary cyberthreat information and the capabilities and resources to participate in information sharing programs, lawmakers and U.S. officials said.

Committee Chairman Steve Chabot (R-Ohio) said at the hearing that the bipartisan Small Business Advanced Cybersecurity Enhancement Act ( H.R. 4668), which he introduced, would help small business regain trust in the government cyberthreat information sharing program and reduce barriers for the companies to share more of such data.

The bill would designate small business development centers as the main contact for cyberthreat sharing; provide small businesses with liability protections under the 2015 Cyberthreat Information Sharing Act (CISA); and ensure that agency policy for information sharing doesn’t unfairly burden small businesses. Velazquez cosponsored the legislation.

Small businesses may not be sharing information with the government because they either don’t trust the process or are unsure what legal and data security protections they have when turning over cyberthreat data, lawmakers said.

Small businesses need to share cyberthreat data and “work with the government, not fear it,” Chabot said at the hearing.

The committee hasn’t scheduled a markup of the bill. There is no companion legislation in the Senate.

To contact the reporter on this story: Daniel R. Stoller in Washington at dstoller@bloomberglaw.com

To contact the editor responsible for this story: Donald Aplin at daplin@bloomberglaw.com

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