House Panel Told That Obama Cybersecurity Plan Lacks Adequate Business Safeguards

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 Alexei Alexis

March 4 — A cybersecurity bill proposed by President Barack Obama doesn't go far enough to address potential liability risks that are preventing U.S. companies from sharing threat information, a U.S. Chamber of Commerce official said at a March 4 hearing of the House Homeland Security Subcommittee on Cybersecurity, Infrastructure Protection, and Security Technologies.

Liability protections under Obama's proposal and a similar bill introduced by Sen. Tom Carper (D-Del.) are “far too narrow” and don't reflect information-sharing relationships that businesses have built up over time, Matthew Eggers, the chamber's senior director of national security and emergency preparedness, said.

In addition, companies wouldn't be protected when monitoring information systems and sharing or receiving countermeasures, he said.

“The lack of safeguards in these areas is a fundamental weakness of the White House proposal” as well as for a similar bill (S. 456) introduced by Sen. Tom Carper (D-Del.) , Eggers told the subcommittee.

In January, the president urged Congress to pass a package of cybersecurity proposals, including proposed legislation to provide liability protection to companies that share threat information with the Department of Homeland Security.

Liability Risks

Subcommittee Chairman John Ratcliffe (R-Texas)said many companies choose not to share vital cyberthreat information with one another or the government because of liability fears.

“Information about an attack experienced by one company can enable another to fortify its defenses,” he said. “Yet when this sharing does not occur, it leaves all of us more vulnerable because the same criminals can use the same tactics to target other companies, exposing even more Americans to having their private information compromised.”

Ratcliffe said he looks forward to working with Rep. Michael McCaul (R-Texas), who leads the full committee, and their Democratic counterparts on the panel to craft “thoughtful cybersecurity legislation.” After the hearing, he told Bloomberg BNA that he is hoping to see a bill introduced this spring.

The panel also heard testimony from Greg Garcia, executive director of the Financial Services Sector Coordinating Council; Martin Libicki of the RAND Corp.; and Mary Ellen Callahan, a partner at Jenner & Block LLP and former chief privacy officer at the DHS.

Under the president's plan, companies would qualify for liability protection only when they share threat information with the DHS National Cybersecurity and Communications Integration Center or industry-led “information sharing and analysis organizations” (ISAOs).

Obama recently signed an executive order directing the DHS to enter into an agreement with a nongovernmental organization to identify voluntary standards or guidelines for the creation of ISAOs.

Senate Efforts

Senate Homeland Security and Governmental Affairs Chairman Ron Johnson (R-Wis.) has expressed interest in working on cybersecurity as well, but his next steps are unclear. Johnson told Bloomberg BNA March 4 that he's waiting to see what happens with a draft information-sharing bill that is expected to be taken up by the Senate Intelligence Committee.

“If they can get broad, bipartisan support, that would be fine—if not, we'll try and do something potentially through our committee,” he said.

The American Civil Liberties Union and other groups sent a letter to Senate Intelligence Committee leaders March 2, saying that the draft bill would expand government surveillance at a time when the public is already concerned about controversial programs at the National Security Agency. 

To contact the reporter on this story: Alexei Alexis in Washington at aalexis @bna.com

To contact the editor responsible for this story: Heather Rothman at hrothman@bna.com

Further information on the hearing, including links to prepared testimony and an archived webcast, is available at http://homeland.house.gov/hearing/subcommittee-hearing-industry-perspectives-president-s-cybersecurity-information-sharing.