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Court: FTC Can Punish Companies With Sloppy Cybersecurity
jfruh writes: The Congressional act that created the Federal Trade Commission gave that agency broad powers to punish companies engaged in "unfair and deceptive practices." Today, a U.S. appeals court affirmed that sloppy cybersecurity falls under that umbrella. The case involves data breaches at Wyndham Worldwide, which stored customer payment card information in clear, readable text, and used easily guessed passwords to access its important systems.
What constitutes sufficiently strong security practices? This seems subjective unless there are clear rules published. Obviously we'd agree that the practices in the summary are truly awful, but there are plenty of data breaches that don't seem quite as egregious. Are there going to be standards for applying patches to vulnerable software? What about human error such as tricking someone to giving out data they shouldn't or losing hard drives with data? Unless clear standards are published, this seems like an opportunity for selective enforcement. Also, while I understand it's a different agency, the US government is one of the worst offenders in terms of poor security practices. Who will hold the IRS accountable for their data breach, for example? It's hypocritical for the government to hold businesses accountable when they're an awful offender, too.
M-I-Z
kU still sucks!
The trouble is when the CEO says "don't bother with security", and his underlings have to obey or get fired, then the CEO claims he can't be blamed for the actions of his underlings. Of course, the way the CEO says "don't bother with security" is by setting spending and productivity requirements, such that no spending can actually be done on security else you get fired for lack of productivity.
Don't waste your vote! Vote for whoever you want, unless you live in a swing state it won't matter anyways
Well, if you can't even minimally secure a customer's data, you probably shouldn't collect and keep it. This company was keeping unencrypted financial data on non-firewalled systems. "Bank-like"? Really? How about equivalent to a kid's lemonade stand? Seriously, if I set the bar any lower a snail with a broken foot could clear it.
What would make a big difference would be to force businesses beyond a certain size to assume liability for breaches, with minimum punitive damages and a presumption of responsibility. Then let the insurance companies dictate what will/won't be covered. As soon as there's a financial incentive, you'll get whiplash keeping up with security upgrades.
Frankly, I'd like to see companies punished for attempting to prosecute legitimate security research. However, one battle at a time seems wise.