As we start down the path of 2023, with the pandemic not quite behind us and economic uncertainty looming, the world can seem unsettled. Some things do appear to be a constant. Included in those are regulatory and court scrutiny on privacy and cybersecurity. As companies’ privacy and security teams make plans for their 2023 compliance efforts, it can be helpful to look back at last year’s developments.
Privacy and Data Security
2021 Privacy Year In Review
Just as we thought 2022 was going to be significantly different than 2021, December 2021 and January 2022 events have thrown us for another (pandemic) loop. We anticipate that some of the privacy and cybersecurity developments from 2021 may similarly repeat in 2022. To help prepare for privacy and cybersecurity program plans for the year, we have created a comprehensive resource of all our www.eyeonprivacy.com posts from last year. From artificial intelligence, biometrics, new US privacy laws, ongoing scrutiny of breach and security issues, to concerns over global data flows, 2021 was a busy year. We have also included several articles focused specifically on managing privacy compliance, and include an examination of right-sized privacy programs, regulatory priorities, and managing “unknown” and unpredictable risks.
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Beginning in May 2022 Banks Will Have 36 Hours to Disclose Certain Types of Cyber Incidents
Federal banking regulators issued a final rule that impacts how banks and other regulated entities report certain data incidents. Those subject to these new reporting requirements include U.S. banks and bank service providers. The rule is effective April 1, 2022, and covered entities are expected to comply with the final rule by May 1, 2022. The new requirements reflect ongoing concern to identify and stop computer security incidents before they become systemic.
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2020 Privacy Year In Review
As we reach the end of January 2021, it is becoming increasingly clear that this will be a busy year in the areas of privacy and data security. Following up on our posts discussing some of the important trends from last year, the Sheppard Mullin Privacy and Cyber Security team has put together a comprehensive resource containing all of our posts from last year. From a focus on artificial intelligence, to international data flow and vendor transfer concerns, to ongoing enforcement of a patchwork of laws, we anticipate many of the issues facing companies in 2020 will not go away this year.
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Brazil’s Comprehensive Privacy Law Now in Effect
Following lots of legislative uncertainty, Brazil has now formally enacted the country’s first general data protection law, Lei Geral de Proteção de Dados, or “LGPD.” While administrative sanctions do not go into effect until August 1, 2021, individuals and public prosecutors can now bring claims for losses and damages. Indeed, at least one public civil action has already been filed. LGPD is the first comprehensive general data protection law in Latin America. It was modeled after the EU’s GDPR. While there are many similarities, LGPD does introduce new concepts. Below are some of the key elements to keep in mind.
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NIST Issues Draft Guidance on Security and Privacy Control Baselines – SP 800-53B
NIST’s new draft guidance, Special Publication 800-53B, Control Baselines for Information Systems and Organizations, provides important information on selecting both security and privacy control baselines for the Federal Government. These control baselines are from NIST Special Publication 800-53 and have been moved to this separate publication “so the SP 800-53 [can] serve as a consolidated catalog of security and privacy controls regardless of how those controls [are] used by different communities of interest.” The new guidance addresses federal information systems and is applicable to information systems used or operated by an agency, a contractor on behalf of an agency, or another organization on behalf of an agency.
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SEC Takes Baby Steps on Cyber, but Signals Greater Vigilance
On February 21, the Securities and Exchange Commission issued new Interpretive Guidance regarding disclosures of cybersecurity-related information by publicly traded companies. This guidance comes in the context of public pressure on the SEC to update its 2011 Division of Corporation Finance guidance regarding cybersecurity risks and incidents. According to SEC Chairman Jay Clayton’s statement, this new document serves to reinforce and expand the prior guidance. It lays out principles that companies should follow in determining when cybersecurity information should be disclosed, and what should be disclosed.
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The Encryption Battle Will Continue in 2018
While they may disagree in other areas, one thing that former FBI Director James Comey, current Deputy Attorney General Rod Rosenstein, and current FBI Director Christopher Wray all have in common is their distaste for strong encryption that prevents the government from accessing information. In 2016, Comey and the Justice Department went to court to try to force Apple to help the government decrypt messages sent by the San Bernardino terrorist attackers. A few months ago, Rosenstein picked up that torch, discussing the need for government access to encrypted information in two separate speeches in October, then repeating his views in the wake of November’s mass shooting at a church in Texas. On January 10, Wray raised the subject in a speech, referring to it as “an urgent public safety issue.” At the same time, as tech companies are quick to point out, the rising tide of information snooping by foreign governments and private actors makes the need for strong encryption greater than ever. The Trump Administration’s strong law-and-order stance, and relative lack of sympathy for tech companies and civil libertarians, mean that 2018 could lead to new developments in this area.
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How Will Breach Laws Develop in 2018?
You hopefully already know that Maryland’s amendment to its data breach notification law went into effect this week (on January 1, 2018). We anticipate that other states may follow one of Maryland’s modifications, namely its expansion of the definition of personal information. Under the amended law “personal information” now includes an expanded definition of biometric information. Biometric information is defined as any automatically generated biologic measurements, rather than just specifically listed items like fingerprints (the definition prior to the amendment). A handful of states have laws —like Maryland— that include biometric information in the definition of personal information. Those include Illinois, Nebraska, Nevada, North Carolina, Wisconsin, and Wyoming. We expect other states may join these. We also expect that states may otherwise continue to expand the definition of personal information in their breach notice laws.
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Cybersecurity in the First Year of the Trump Administration
As might be expected, the first year of the Trump Administration saw a lot of activity on the cybersecurity front. In May, the Administration issued its “Presidential Executive Order on Strengthening the Cybersecurity of Federal Networks and Critical Infrastructure.” As we discussed in an analysis we issued shortly thereafter, the Order brought more accountability to agencies for monitoring their own cybersecurity, and required them all to implement the NIST Cybersecurity Framework. In September, the Department of Homeland Security banned the use of products, solutions or services offered by Kaspersky Labs. And of course, cybersecurity continues to play an important role in ongoing investigations and political activities relating to the hacking of the Democratic National Committee.
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Assessing GDPR Guidelines Part II: Data Impact Assessments
Following up on yesterday’s blog about profiling and automated decision making, we now look at guidance on data protection impact assessment (DPIA). The same guidance we discussed also directs companies to conduct a DPIA where profiling or automated decision making results in the “systematic and extensive evaluation” of an individual and decisions are made based on that evaluation that could have legal effects.
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