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Connecticut May Require Businesses to Offer One Year of Identity Theft Protection Services Following a Data Breach, Joining Other States in Strengthening Notification Laws
Wednesday, June 3, 2015

Following a string of states across the country that have strengthened their data breach notification laws in recent months, Connecticut is about to amend its law to require, among other things, that businesses provide one year of identity-theft protection for persons affected by the breach. Many businesses already extend such services to breach victims, but, if enacted, Senate Bill 949 would mandate covered business incur this expense. According to Connecticut’s Attorney General, George Jepsen, this change would only set “a floor for the duration of the protection” and his office may continue to “seek broader kinds of protection,” reports the Hartford Courant.

Specifically, the bill would require businesses that conduct business in the state and who own or license certain personal information of a Connecticut resident that is breached to

offer to each resident…appropriate identity theft prevention services and, if applicable, identity theft mitigation services. Such service or services shall be provided at no cost to such resident for a period of not less than twelve months. Such person shall provide all information necessary for such resident to enroll in such service or services and shall include information on how such resident can place a credit freeze on such resident’s credit file.

Anticipated to become effective October 1, 2015, the bill also would require notice be provided not later than ninety days from discovering the breach, even though the current law already requires notification without unreasonable delay. Other provisions of the bill would add data security requirements applicable to state agencies and companies that contract with the state.

If signed into law by Governor Malloy, this bill would add to the matrix of state laws that businesses contend with when they experience multi-state data breaches. This frequently changing matrix, as highlighted by this possible change and those summarized below, highlights the need for companies to have a plan for responding to data breaches. According to InfoSecurity Magazine, about 86% of IT executives “feel prepared” for a data breach, but only 40% have a response plan. A company’s IT Director may feel she is prepared from an information security perspective, but may not have considered all of the steps the company would have to take in the event of a breach – these include without limitation: investigation, notification, legal compliance, media relations, coordination with law enforcement, arranging for identity theft protection services, setting up a call center, etc.

So what has been going on in other states?

As discussed below, a number of states have strengthened their generally applicable breach notification laws. Some states added provisions specifically for states agencies, while others revised data security mandates concerning student data. For example, Virginia’s Governor signed H.B. 2350 into law which directs the state’s Department of Education to develop a model data security plan that may be used by school divisions to implement policies and procedures related to the protection of student data and data systems.

Montana: Beginning in October, the definition of personal information that could trigger a data breach was expanded from first name or initial and last name together with social security number, driver license number, or certain financial account numbers, to include certain medical information. The law change also requires notification to the States Attorney General’s office, as well as the affected individuals.

Nevada: Effective July 1, 2015, the personal information that will trigger a notification requirement if breached now includes (i) a medical identification number or a health insurance identification number, and (ii) a user name, unique identifier or electronic mail address in combination with a password, access code or security question and answer that would permit access to an online account.

North Dakota: According to the amendment to this state’s law, businesses no longer have to be doing business in the state to be subject to the law, they simply have to own or license personal information that belongs to a resident of the state. The law also adds a notification requirement to the state’s Attorney General if more than 250 residents are affected by the breach. These and other changes made by the amendment become effective on and after August 1, 2015.

Washington: On April 23, 2015, Washington made a number of changes to its breach notification law. These include: (i) 45-day deadline for providing notification; (ii) adding a state Attorney General notification requirement; (iii) addition of specific notice content requirements, such as the name and contact information of the business reporting the breach; and (iv) expanding the application of the law to personal information in paper format. The law becomes effective July 24, 2015.

Wyoming: In Wyoming, two bills were passed to change the law in that state – S.F. 35 and S.F. 36. The changes that become effective July 1, 2015, include expanding the elements of personal information that would trigger a breach, and the information that must be included in the notification letters. Under the law as amended, personal information now also includes personal data such as (i) Federal- or state-government issued identification card; (ii) shared login secrets or security tokens known to be used for data based authentication; (iii) username or email address, in combination with a required password or security question and answer; (iv) a birth or marriage certificate; and (v) certain medical and health insurance information.

Also, notifications must provide breach victims specific information such as: (i) the types of personal identifying information believed to have been the subject of the breach; (ii) a general description of the breach and approximate date of the breach, if reasonably possible to determine at the time of the notice; (iii) actions taken to protect the system from further breaches; and (iv) advice directing affected persons to remain vigilant by reviewing account statements and monitoring credit reports.

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