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Financial Services Law Insights and Observations

Coalition of state Attorneys General urges Congress to oppose data breach bill

Privacy/Cyber Risk & Data Security State Issues State Attorney General Data Breach Security Freeze

Privacy, Cyber Risk & Data Security

On March 19, the Illinois Attorney General, along with 30 other state Attorneys General and the Executive Director of the Hawaii Office of Consumer Protection, issued a letter to selected members of Congress opposing the Data Acquisition and Technology Accountability and Security Act (the DATAS Act), which would establish broad standards for data protection across industries and create federal notification requirements for covered entities after certain types of data breaches. (See previous InfoBytes coverage here.) According to the Illinois Attorney General’s letter, the DATAS Act would preempt state data breach and data security laws. The letter also stated that “States have proven themselves to be active, agile, and experienced enforcers of their consumers’ data security and privacy. With the increasing threat and ever-evolving nature of data security risks, the state consumer protection laws that our Offices enforce provide vital flexibility and a vehicle by which the States can rapidly and effectively respond to protect their consumers.” Serious potential concerns arising from the DATAS Act raised in the letter include (i) reduced transparency to consumers; (ii) delayed notification to consumers affected by data breaches; and (iii) an overly narrow focus on large-scale data breaches “affecting 5,000 or more consumers” which “prevent[s] attorneys general from learning of or addressing breaches that happen on a smaller national scale.”

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