- NY Attorney General Offers Guidance on Dealing with Credential Stuffing
- “Silent Cyber” Continues to Make Noise in State Appellate Courts
- The FBI Warns M&A Participants on the Increasing Ransomware Threat
- FTC Updates Safeguards Rule for Non-Banking Financial Institutions
- The DOJ’s Civil Cyber-Fraud Initiative
- The Framework of a Tort-Claim Safe Harbor
- OFAC Issues Updated Ransomware Advisory
- COVID-19 Operations: How to Keep Vaccine-Related Data Safe
- Colorado Passes Comprehensive Consumer Privacy Law
- Understanding National Security Implications of Sensitive Data
Legal developments in data, privacy, cybersecurity, and other emerging technology issues
- Posts by Steven M. WernikoffPartner
Steve Wernikoff is a litigation and transactional partner who co-leads two of the firm's technology-based practice areas–the Data, Privacy, and Cybersecurity group and the Autonomous Vehicle group. As a previous officer and ...
Last week, the New York Attorney General’s office offered guidance regarding credential stuffing, a common and costly attack on businesses and consumers, in which threat actors repeatedly attempt to log in to online accounts using usernames and passwords stolen from other online services. Credential stuffing takes advantage of three aspects of the online ecosystem: (1) most online accounts utilize usernames and passwords; (2) a steady flow of data breaches has resulted in billions of stolen credentials being leaked onto the dark web for other threat actors to exploit; and (3) consumers tend to reuse the same passwords across multiple online services.
Last week, the Federal Bureau of Investigation issued a private industry notification warning that “ransomware actors are very likely using significant financial events, such as mergers and acquisitions, to target and leverage victim companies for ransomware infections.” The FBI cautioned that ransomware attackers research publicly available information and target companies involved in significant, time-sensitive financial dealings such as M&A and other transactions. This initial reconnaissance, according to the FBI, is later followed by a ransomware attack and a subsequent threat that unless the victim pays the ransom, the attackers will disclose the information publicly, causing potential investor backlash and affecting the victim’s stock value.
The Federal Trade Commission recently announced a newly updated rule concerning the data security safeguards required for financial institutions to protect their customers’ financial information. The FTC’s updated Safeguards Rule, which originally was mandated by Congress under the 1999 Gramm-Leach-Bliley Act, requires non-banking financial institutions, such as mortgage brokers, motor vehicle dealers, and payday lenders, to develop, implement, and maintain a comprehensive security system to keep their customers’ information safe. The new rule more closely aligns with the NY Department of Financial Services Cybersecurity Regulation.
On September 21, 2021, the U.S. Department of Treasury’s Office of Foreign Assets Control (OFAC) issued an updated ransomware advisory (the “2021 Guidance”), which supersedes its 2020 ransomware guidance (the “2020 Guidance”), discussed in a previous post on this blog.
In the 2021 Guidance, OFAC notes that ransomware payment demands have escalated during the COVID-19 pandemic as U.S. businesses maintain significant online and internet-connected activities. OFAC identifies a 21 percent increase in ransomware attacks and a 225 percent increase in ransomware losses as reported by the Federal Bureau of Investigation (FBI). The pandemic has presented numerous opportunities for cyber actors to target system vulnerabilities, particularly smaller businesses and municipal entities with limited resources for cybersecurity investments as well as entities supporting critical infrastructure, such as hospitals, that are likely to make quick payments to avoid service disruptions to patients.
Today, the European Commission (“EC”) adopted new standard contractual clauses (“SCCs”) reflecting new requirements under the European Union’s General Data Protection Regulation (“GDPR”). The SCCs are intended to provide standardized templates for companies to utilize to comply with the GDPR’s data protection requirements.
In late 2020, a sophisticated adversary used the SolarWinds Orion Platform to plant covert backdoors in the networks of thousands of companies and government agencies. The attack confirms the importance of vigorous third-party risk management. Last month, the New York State Department of Financial Services (“NYDFS”) issued a report on the SolarWinds attack and provided the following steps that companies can take to reduce supply chain risk:
Yesterday, the U.S. Supreme Court, in AMG Capital Management, LLC v. FTC, sharply curtailed the ability of the Federal Trade Commission to obtain restitution and disgorgement in enforcement actions. In a 9-0 decision, the court found that Section 13(b) of the FTC Act, which authorizes the FTC to seek permanent injunctions in federal court, did not also authorize the Commission to obtain court-ordered monetary relief.
With the passage of the Cybersecurity Affirmative Defense Act, Utah became the second state – after Ohio’s Data Protection Act in 2018 – to create an affirmative defense to certain causes of action stemming from a data breach. The law provides an affirmative defense under Utah law and in Utah courts to certain tort claims arising out of a data breach if the company demonstrates that it created, maintained, and reasonably complied with a written cybersecurity program.
With Governor Ralph Northam’s signature yesterday, the Consumer Data Protection Act (“CDPA”) became law, making Virginia the second state after California to enact a comprehensive privacy law (with apologies to Nevada, which also has passed more modest privacy legislation). Although similar in many respects to the California Consumer Privacy Act (“CCPA”), which was recently updated by the Consumer Privacy Rights Act (“CPRA”), the law contains terminology more consistent with the European Union’s General Data Protection Regulation (“GDPR”).
In Tsao v. Captiva MVP Restaurant Partners, LLC, the Eleventh Circuit joined the federal appellate courts holding that a consumer’s exposure to a substantial risk of future identity theft, and efforts to mitigate the risk of future identity theft, are not sufficient to confer Article III standing. The decision highlights federal court’s struggle with the standing requirements in a data breach case, and possibly raises the likelihood that the U.S. Supreme Court will address the issue.
Given the speculation and concern over ransomware attacks impacting the 2020 U.S. election, the recent spate of private companies falling victim to such attacks, and the October 1, 2020 advisory issued by the Department of Treasury (“Advisory”), it is no surprise that ransomware is trending in cybersecurity.
On September 23, 2020, Representatives Bob Latta (R-Ohio) and Greg Walden (R-Ore.) re-introduced the “Safely Ensuring Lives Future Deployment and Research In Vehicle Evolution Act’’ or the ‘‘SELF DRIVE Act” to create a federal framework for autonomous vehicles (“AVs”). The measure lacks bipartisan support and is not expected to reach the floor of the House of Representatives during this session. But the continued effort demonstrates the importance that many lawmakers put on promoting a U.S.-led effort in the development of self-driving vehicles. The matter likely will be among the key transportation themes before the next session of Congress, which convenes in January. On the Senate side, policymakers have not advanced autonomous vehicle bills. In the previous congressional session, an autonomous vehicle policy measure advanced in the House but came up short in the Senate.
A number of U.S. federal agencies have authority to issue a type of administrative subpoena called a Civil Investigative Demand (“CID”) to obtain relevant information as part of an investigation. For example, both the Federal Trade Commission (“FTC”) and the Consumer Financial Protection Bureau (“CFPB”) have authority to issue CIDs to obtain documents and testimony in investigations related to privacy, data security, deceptive marketing, and financial fraud. This article identifies some items to consider when receiving a CIDs based on my experience issuing and reviewing hundreds of CIDs as an enforcement attorney in the Chicago office of the FTC.
As schools increasingly are adjusting to remote learning and utilizing education technology (“ed tech”) services, both schools and their ed tech service providers need to consider the appropriate collection and usage of student personal information. Here are some tips for protecting students’ privacy and safeguarding personal data:
New York’s Stop Hacks and Improve Electronic Data Security Act (the “SHIELD Act”) took effect on March 21, 2020. The Act expands existing state breach notification requirements and imposes specific data security protections for covered businesses that own or license the private information of New York residents, regardless of whether those businesses are based in New York. The Act also broadens the definition of “private information” to include new types and combinations of data.
On March 31, 2020, Washington Senate Bill No. 6280 (the “Act”) became law, codifying one of the most detailed facial recognition regulations in the country. The Act regulates state and local government agencies in Washington using or intending to develop, procure, or use a facial recognition service but also includes important considerations for companies designing this technology.
Under extraordinary circumstances, businesses are quickly adapting to remote work on a large scale. In doing so, companies should promote best practices to protect sensitive data. Below are some techniques that your company can employ to help ensure that sensitive personal or company information stays safe: