Compliance Information Governance Regulations

5 Ideas To Kickstart Your Governance, Risk and Compliance Program in the New Year!

By Rafael Moscatel, CIPM, CRM, IGP on

We’ve all been there. Sitting around the conference room with our compliance teams, droning on about scheduling conflicts, procedural details and strategy about strategy. Here are some actual substantive ideas, initiatives and approaches to privacy, data governance and cyber-security that can get the ball rolling next year.

1. Policies aren’t just documents you keep around in case you might have to show them to a judge one day. Start putting them to work and leveraging their authority to cut costs and reduce operational risks!

For example:

  • Privacy policies, now required to be updated annually by the State of California, can actually help drive data mapping exercises, leading to new insights into structured and unstructured data systems. Use those insights to help patch gaps in your IT infrastructure and even retire costly, redundant systems, classify shadow IT and discard unused shelfware.
  • Retention policies can be used as virtual blueprints to justify and destroy, costly, over-retained paper records and electronic data lingering around the office and waiting to be discovered… by your adversaries!
  • Cyber-security policies like those required by the New York DFS can be used to help IT decision makers prioritize strategic investments in your cyber-defense software.
2. Chief executives realize audits are necessary to continually optimize business processes, but even the sharpest leaders sometimes forget the most sobering, useful assessments are conducted by outside parties who don’t have an inherently biased interest in determining the findings.

Executives need to make sure they are told what they need to hear, not what they want to hear.

3. One of the reasons assurance departments like compliance, risk and internal audit struggle with their annual reviews is because of a lack of policy organization within their OWN departments.

Lack of procedural consistency, ownership of policy and overlap and confusion over a directives authority in can create even more conflict, risk and uncertainty for an organization. But relying on institutional knowledge and spreadsheets just doesn’t cut it anymore. That’s why every regulated company needs a strong technology backbone in the form of a GRC or governance risk and compliance software.

4. These days the risk is not just internal. With so much of our data in the cloud and managed by other parties, some of the greatest risks have moved outside of the firewall.

Organizations need strategies and tools to help them prioritize and manage those vendor risks effectively. Sophisticated and affordable tools that address consumer data privacy requests can also be used to map and streamline an organizations external data, whether it’s private in nature or otherwise.

5. Finally, risk is not a one size fits all problem. Investment needs to be proportional to the exposure. That’s why it’s important to spend enough time planning your long-term strategy rather diving headfirst into solutions that promise the moon and end up creating more infrastructure dependency than you bargained for.

Rafael Moscatel is Managing Director of Compliance and Privacy Partners, a consulting firm specializing in data governance and privacy solutions. He is an award-winning Information Governance Professional (IGP), Certified Records Manager (CRM), Certified Information Privacy Manager (CIPM). Rafael has spent the last twenty years developing large-scale Information Management Programs for the Fortune 500 including Paramount Pictures and Farmers Insurance. Reach him at 323-413-7432, follow him on Twitter at @rafael_moscatel or visit http://www.capp-llc.com to learn more.

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Professional Development Records Management

Meeting Evolving Business Needs: A Conversation Between RIM Educators and Thought Leaders

By Rafael Moscatel, CIPM, CRM, IGP on

ICRM will not only conduct their spring Board and Business meetings at the MER Conference next May in Chicago, but will also facilitate a panel discussion  “Meeting Evolving Business Needs: A Conversation Between RIM Educators and Thought Leaders.” 

The panel of experts include: John Isaza, Esq, FAI, Rafael Moscatel, CRM, IGP, CIPM, and Wendy McLain, MLIS, CRM.  The panel of Academic Partners include: Patricia Franks, Ph.D, CRM, CA, IGP – San Jose State University; Gregory S. Hunter, Ph.D, CA, CRM, FSAA – Long Island University, Palmer School of Library and Information Science, and Tao Jin, Ph.D – Louisiana State University, School of Library and Information Science.

The desired outcome is to expand and nurture an ongoing and productive dialogue between our profession and academic institutions to ensure graduates are well prepared to fill current and future positions in key areas of Records and Information Management (RIM) and Information Governance (IG).  If interested in joining us at the MER Conference – go to their website and register for conference.  https://www.merconference.com/

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Privacy Regulations

FTC Extends Deadline for Comments on COPPA Rule until December 11

By Rafael Moscatel, CIPM, CRM, IGP on

The Federal Trade Commission is extending the deadline to submit comments on the agency’s review of the Children’s Online Privacy Protection Act Rule (COPPA Rule) until December 11, 2019.

The federal government’s Regulations.gov portal is temporarily inaccessible. The FTC is giving commenters additional time to submit comments, as well as an alternative mechanism to file them. Those unable to submit comments via Regulations.gov can submit them via email with the subject line “COPPA comment” to secretary@ftc.gov. All comments, whether filed through Regulations.gov or sent by email, must be submitted by11:59 p.m. ET on December 11, 2019.

The Commission voted 5-0 to extend the comment deadline until December 11, 2019.

Rafael Moscatel, CRM, IGP, is the Managing Director of Compliance and Privacy Partners, LLC. Reach him at 323-413-7432, follow him on Twitter at @rafael_moscatel or visit http://www.capp-llc.com to learn more.

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Hacking Information Security Information Technology

Russian National Charged with Decade-Long Series of Hacking and Bank Fraud Offenses

By Rafael Moscatel, CIPM, CRM, IGP on
From the US Justice Department

Russian National Charged with Decade-Long Series of Hacking and Bank Fraud Offenses Resulting in Tens of Millions in Losses and Second Russian National Charged with Involvement in Deployment of “Bugat” Malware

Reward of up to $5 Million Offered for Information Leading to Arrest or Conviction

The United States of America, through its Departments of Justice and State, and the United Kingdom, through its National Crime Agency (NCA), today announced the unsealing of criminal charges in Pittsburgh, Pennsylvania, and Lincoln, Nebraska, against Maksim V. Yakubets, aka online moniker, “aqua,” 32, of Moscow, Russia, related to two separate international computer hacking and bank fraud schemes spanning from May 2009 to the present.  A second individual, Igor Turashev, 38, from Yoshkar-Ola, Russia, was also indicted in Pittsburgh for his role related to the “Bugat” malware conspiracy. The State Department, in partnership with the FBI, announced today a reward of up to $5 million under the Transnational Organized Crime Rewards Program for information leading to the arrest and/or conviction of Yakubets.  This represents the largest such reward offer for a cyber criminal to date.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Scott W. Brady for the Western District of Pennsylvania, U.S. Attorney Joseph P. Kelly for the District of Nebraska, FBI Deputy Director David Bowdich, Principal Deputy Assistant Secretary James A. Walsh of the State Department’s Bureau of International Narcotics and Law Enforcement Affairs (INL), and Director Rob Jones of the Cyber Crime Unit  at the United Kingdom’s National Crime Agency (NCA) made the announcement.

“Maksim Yakubets allegedly has engaged in a decade-long cybercrime spree that deployed two of the most damaging pieces of financial malware ever used and resulted in tens of millions of dollars of losses to victims worldwide,” said Assistant Attorney General Benczkowski.  “These two cases demonstrate our commitment to unmasking the perpetrators behind the world’s most egregious cyberattacks.  The assistance of our international partners, in particular the National Crime Agency of the United Kingdom, was crucial to our efforts to identify Yakubets and his co-conspirators.”

“For over a decade, Maksim Yakubets and Igor Turashev led one of the most sophisticated transnational cybercrime syndicates in the world,” said U.S. Attorney Brady. “Deploying ‘Bugat’ malware, also known as ‘Cridex’ and ‘Dridex,’ these cybercriminals targeted individuals and companies in western Pennsylvania and across the globe in one of the most widespread malware campaigns we have ever encountered.  International cybercriminals who target Pennsylvania citizens and companies are no different than any other criminal: they will be investigated, prosecuted and held accountable for their actions.”

“The Zeus scheme was one of the most outrageous cybercrimes in history,” said U.S. Attorney Kelly.  “Our identification of Yakubets as the actor who used the moniker ‘aqua’ in that scheme, as alleged in the complaint unsealed today, is a prime example of how we will pursue cyber criminals to the ends of justice no matter how long it takes, by tracking their activity both online and off and working with our international partners to expose their crimes.”

“Today’s announcement involved a long running investigation of a sophisticated organized cybercrime syndicate,” said FBI Deputy Director Bowdich. “The charges highlight the persistence of the FBI and our partners to vigorously pursue those who desire to profit from innocent people through deception and theft. By calling out those who threaten American businesses and citizens, we expose criminals who hide behind devices and launch attacks that threaten our public safety and economic stability. The actions highlighted today, which represent a continuing trend of cyber-criminal activity emanating from Russian actors, were particularly damaging as they targeted U.S. entities across all sectors and walks of life. The FBI, with the assistance of private industry and our international and U.S. government partners, is sending a strong message that we will work together to investigate and hold all criminals accountable. Our memory is long and we will hold them accountable under the law, no matter where they attempt to hide.”

“Combatting cybercrime remains a top national security priority for to the United States,” said INL Principal Deputy Assistant Secretary of State Walsh. “The announcements today represent a coordinated interagency effort to bring Maksim Yakubets to justice and to address cybercrime globally.”

“This is a landmark for the NCA, FBI and U.S. authorities and a day of reckoning for those who commit cybercrime,” said NCA Director Jones. “Following years of online pursuit, I am pleased to see the real world identity of Yakubets and his associate Turashev revealed.  Yakubets and his associates have allegedly been responsible for losses and attempted losses totalling hundreds of millions of dollars. This is not a victimless crime, those losses were once people’s life savings, now emptied from their bank accounts.  Today the process of bringing Yakubets and his criminal associates to justice begins.  This is not the end of our investigation, and we will continue to work closely with international partners to present a united front against criminality that threatens our prosperity and security.”

Yakubets and Turashev Indicted in Relation to “Bugat” Malware

A federal grand jury in Pittsburgh returned a 10-count indictment, which was unsealed today, against Yakubets and Turashev, charging them with conspiracy, computer hacking, wire fraud, and bank fraud, in connection with the distribution of “Bugat,” a multifunction malware package designed to automate the theft of confidential personal and financial information, such as online banking credentials, from infected computers.  Later versions of the malware were designed with the added function of assisting in the installation of ransomware.

According to the indictment, Bugat is a malware specifically crafted to defeat antivirus and other protective measures employed by victims.  As the individuals behind Bugat improved the malware and added functionality, the name of the malware changed, at one point being called “Cridex,” and later “Dridex,” according to the indictment.  Bugat malware was allegedly designed to automate the theft of confidential personal and financial information, such as online banking credentials, and facilitated the theft of confidential personal and financial information by a number of methods.  For example, the indictment alleges that the Bugat malware allowed computer intruders to hijack a computer session and present a fake online banking webpage to trick a user into entering personal and financial information.

The indictment further alleges that Yakubets and Turashev used captured banking credentials to cause banks to make unauthorized electronic funds transfers from the victims’ bank accounts, without the knowledge or consent of the account holders.  They then allegedly used persons, known as “money mules,” to receive stolen funds into their bank accounts, and then move the money to other accounts or withdraw the funds and transport the funds overseas as smuggled bulk cash.  According to the indictment, they also used a powerful online tool known as a botnet in furtherance of the scheme.

Yakubets was the leader of the group of conspirators involved with the Bugat malware and botnet, according to the indictment.  As the leader, he oversaw and managed the development, maintenance, distribution, and infection of Bugat as well as the financial theft and the use of money mules.  Turashev allegedly handled a variety of functions for the Bugat conspiracy, including system administration, management of the internal control panel, and oversight of botnet operations.

According to the indictment, Yakubets and Turashev victimized multiple entities, including two banks, a school district, and four companies including a petroleum business, building materials supply company, vacuum and thin film deposition technology company and metal manufacturer in the Western District of Pennsylvania and a firearm manufacturer.  The indictment alleges that these attacks resulted in the theft of millions of dollars, and occurred as recently as March 19, 2019.

Yakubets Charged in Relation to “Zeus” Malware

A criminal complaint was also unsealed in Lincoln today charging Yakubets with conspiracy to commit bank fraud in connection with the “Zeus” malware.  Beginning in May 2009, Yakubets and multiple co-conspirators are alleged to have a long-running conspiracy to employ widespread computer intrusions, malicious software, and fraud to steal millions of dollars from numerous bank accounts in the United States and elsewhere.  Yakubets and his co-conspirators allegedly infected thousands of business computers with malicious software that captured passwords, account numbers, and other information necessary to log into online banking accounts, and then used the captured information to steal money from victims’ bank accounts.  As with Bugat, the actors involved with the Zeus scheme were alleged to have employed the use of money mules and a botnet.

Yakubets and his co-conspirators are alleged to have victimized 21 specific municipalities, banks, companies, and non-profit organizations in California, Illinois, Iowa, Kentucky, Maine, Massachusetts, New Mexico, North Carolina, Ohio, Texas, and Washington, identified in the complaint, including multiple entities in Nebraska and a religious congregation.  According to the complaint, the deployment of the Zeus malware resulted overall in the attempted theft of an estimated $220 million USD, with actual losses of an estimated $70 million USD from victims’ bank accounts.  According to the complaint, Yakubets’ role in the Zeus scheme was to provide money mules and their associated banking credentials in order to facilitate the movement of money, which was withdrawn from victim accounts by fraudulent means.

An individual charged as John Doe #2, also known as “aqua,” was indicted in District of Nebraska in case number 4:11-CR-3074.  The indictment in that case charges that individual and others with conspiracy to participate in racketeering activity, conspiracy to commit computer fraud and identity theft, aggravated identity theft, and multiple counts of bank fraud related to the Zeus scheme.  As alleged, the complaint unsealed today associates use of the moniker “aqua” in the Zeus scheme to Yakubets.

In case number 4:11-CR-3074, two of the co-conspirators of “aqua,” Ukrainian nationals Yuriy Konovaleko and Yevhen Kulibaba, were extradited from the United Kingdom to the United States.  Konovalenko and Kulibaba both pleaded guilty in 2015 to conspiracy to participate in racketeering activity and have completed prison sentences that were imposed.  Konovalenko and Kulibaba were previously convicted in the United Kingdom, after an investigation conducted by the Metropolitan Police Service, for their role in laundering £3 million GBP on behalf of the group responsible for the Zeus malware.

State Department $5 million USD Reward

The U.S. Department of State’s Transnational Organized Crime (TOC) Rewards Program is offering a reward of up to $5 million for information on Yakubets.  Cyber threats are a top national security threat to the United States, and the Department of State’s TOC Rewards Program is one of the many tools used by U.S. authorities to bring significant cybercriminals to justice.  Congress established the TOC Rewards Program in 2013 to support law enforcement efforts to dismantle transnational criminal organizations and bring their leaders and members to justice.  The U.S. Department of State’s Bureau of International Narcotics and Law Enforcement Affairs manages the program in coordination with other U.S. federal agencies.

In addition to NCA, the law enforcement actions taken related to these two prosecutions were assisted by the efforts of law enforcement counterparts from The Netherlands, Germany, Belarus, Ukraine, and the Russian Federation.

The FBI’s Pittsburgh and Omaha Field Offices led the investigations of Yakubets and Turashev with assistance by the FBI’s Major Cyber Crimes Unit and Global Operations and Targeting Unit.  The prosecution in Pittsburgh is being handled by Assistant U.S. Attorney Shardul S. Desai of the Western District of Pennsylvania, and the prosecution in Lincoln is being handled by Senior Counsel William A. Hall, Jr., of the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS) and Assistant U.S. Attorney Steven A. Russell of the District of Nebraska.  The Criminal Division’s Office of International Affairs provided significant assistance throughout the criminal investigations.  The Department’s National Security Division also provided investigative assistance.

The details contained in the indictment, criminal complaint and related pleadings are merely accusations, and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

Continue reading “Russian National Charged with Decade-Long Series of Hacking and Bank Fraud Offenses”

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Ethics Information Security Privacy

FTC Issues Opinion and Order Against Cambridge Analytica For Deceiving Consumers About the Collection of Facebook Data, Compliance with EU-U.S. Privacy Shield

By Rafael Moscatel, CIPM, CRM, IGP on

The Federal Trade Commission issued an Opinion finding that the data analytics and consulting company Cambridge Analytica, LLC engaged in deceptive practices to harvest personal information from tens of millions of Facebook users for voter profiling and targeting. The Opinion also found that Cambridge Analytica engaged in deceptive practices relating to its participation in the EU-U.S. Privacy Shield framework.

In an administrative complaint filed in July, FTC staff alleged that Cambridge Analytica and its then-CEO Alexander Nix and app developer Aleksandr Kogan deceived consumers. Nix and Kogan agreed to settle the FTC’s allegations. Cambridge Analytica, which filed for bankruptcy in 2018, did not respond to the complaint filed by FTC staff, or a motion submitted for summary judgment of the allegations.

The FTC staff’s administrative complaint alleged that Kogan worked with Nix and Cambridge Analytica to enable Kogan’s GSRApp to collect Facebook data from app users and their Facebook friends. The complaint alleged that app users were falsely told the app would not collect users’ names or other identifiable information. The GSRApp, however, collected users’ Facebook User ID, which connects individuals to their Facebook profiles.

The complaint also alleged that Cambridge Analytica claimed it participated in the EU-U.S. Privacy Shield—which allows companies to transfer consumer data legally from European Union countries to the United States—after allowing its certification to lapse. In addition, the complaint alleged the company failed to adhere to the Privacy Shield requirement that companies that cease participation in the Privacy Shield affirm to the Department of Commerce, which maintains the list of Privacy Shield participants, that they will continue to apply the Privacy Shield protections to personal information collected while participating in the program.

In its Opinion, the Commission found that Cambridge Analytica violated the FTC Act through the deceptive conduct alleged in the complaint. The Final Order prohibits Cambridge Analytica from making misrepresentations about the extent to which it protects the privacy and confidentiality of personal information, as well as its participation in the EU-U.S. Privacy Shield framework and other similar regulatory or standard-setting organizations. In addition, the company is required to continue to apply Privacy Shield protections to personal information it collected while participating in the program (or to provide other protections authorized by law), or return or delete the information. It also must delete the personal information that it collected through the GSRApp.

The Commission voted 5-0 to issue the Opinion and Final Order.

Rafael Moscatel, CRM, IGP, is the Managing Director of Compliance and Privacy Partners, LLC. Reach him at 323-413-7432, follow him on Twitter at @rafael_moscatel or visit http://www.capp-llc.com to learn more.

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Business Processes Events Information Governance

We’ve Won! 1st place in our 2019 Information Management Today MVP Awards

By Rafael Moscatel, CIPM, CRM, IGP on

The people have spoken and our article, “7 Ways to Prepare Data in the Age of Privacy and Information Governance,” has won 1st place in the 2019 Information Management Today MVP Awards Other category! Thank you to all of our subscribers!

Article reprinted below!

Content may still be king, but now the rights to some of it may belong to the people! In response to the EU’s General Data Protection Requirement (GDPR) and recent stateside efforts to enshrine data protection including the California Consumer Privacy Act (CCPA), organizations are revisiting the efficacy of their Data and Information Governance (IG) programs. Laws and regulations vary by industry and company size but each intend to protect consumer’s personal data by prescribing technical and governance standards backed by stiff penalties for non-compliance.

Notably, while many companies are already familiar with records retention laws, these latest controls also introduce a duty to destroy data once no longer required for a legitimate business purpose. For entities that have grown accustomed to leveraging cheap digital storage, this new responsibility presents a number of logistical hurdles.

However, directives on how you may use your customer’s data or any other information you store doesn’t necessarily have to be burdensome. In fact, these new guardrails present numerous opportunities to implement better governance, monetize the lifecycle of information assets and foster trustworthy relationships that can actually enhance the customer experience.

These 7 tips can help prepare your data to support an IG strategy:

  1. Automate Retention Schedules – Legal and compliance requirements are the cornerstones of corporate governance programs. Yet tracking the multitude of historical and emerging state, federal and international laws and regulations that affect your data decisions can be a monumental task that even the most robust law departments aren’t prepared for. Consider leveraging SaaS software to keep your Risk, Compliance and Legal staff current on the latest citation changes to these nuanced instructions. These tools empower you to defensibly destroy and cleanse costly data no longer useful to your organization.
  2. Cover Your Assets – Satisfying new compliance requirements like GDPR and CCPA means it’s not enough to simply know what kinds of records you keep, you need to know what systems they’re kept in and how that data flows between them. That’s why Chief Data Officers and Enterprise Architects are increasingly embracing asset management tools that not only perform diagnostics on their application stack but allow them to inventory their attributes and map related processes that inform long-term strategic roadmap planning. Tools like these also help support application rationalization projects which in turn aid in classification and disposal of unneeded data.
  3. Introduce Big Buckets – The biggest challenges with enforcing retention across an enterprise are “event triggers” that complicate how long sets of records must be retained. For example, an employee file might be held X years following a termination “event.” Big Bucket strategies allow you to simplify and group “like” records together to support more efficient destruction actions while assuming some risk. Work with your governance partners to determine reasonable standards for a Big Bucket policy and quantifying the acceptable amount of risk your company is willing to assume to achieve cost and efficiency benefits.
  4. Enforce Legal Holds – Cleansing your data lakes and silos to save costs and minimize risk is an exercise in defensible destruction but requires awareness of outstanding legal holds. A company that spoliates evidence subject to a legal hold, even without malice, can be fined and suffer adverse inference litigation rulings resulting in unfavorable judgments. Additionally, healthy oversight of records under a preservation hold doesn’t just make good legal sense, it can also help better identify opportunities for even more defensible destruction, cost reduction and risk mitigation.
  5. Activate File Analysis – The tricky thing about new laws like the CCPA is that they require companies to find and produce data for the consumer wherever it exists. That can be a cumbersome test for many entities that have hundreds or thousands of repositories. Luckily, advanced File Analysis tools can plug directly into your network and help quickly identify sensitive and personally identifiable information (PII). They can also help you deduplicate records and find redundant, obsolete and trivial data clogging your systems, also known as ROT. These tools produce a tangible ROI that management can point to as a prime example of why IG works.
  6. Embrace Content Migrations – Unless you’ve only lived in one home your entire life, you’ve probably experienced the cathartic process of cleansing your old wares in preparation for a move. Bringing in a new content management system is not much different and it’s a unique opportunity to apply retention to your data, discard ROT and provide employees with more accurate knowledge resources.
  7. Bake-in Best Practices – Information Governance is not a “one and done” proposition, it’s a rinse and repeat discipline that only works when management sees to it that organizational culture is along for the ride. These days a basic understanding about data handling is vital for every new hire. Concepts like records retention, data protection and privacy should be part of any overall corporate training plan.

By complementing policy frameworks and toolsets with the types of Information Governance approaches noted here we can better enable our workforce to hone their knowledge skills, achieve defensible destruction and improve audit outcomes. In effect, we are future proofing ourselves for a business world destined to face increased scrutiny and under siege from data breaches and privacy issues with seemingly no end in sight. IG is the bright light at the end of that tunnel.

Rafael Moscatel, CRM, IGP, is the Managing Director of Compliance and Privacy Partners, LLC. Reach him at 323-413-7432, follow him on Twitter at @rafael_moscatel or visit http://www.capp-llc.com to learn more.

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Information Security Privacy

FTC Announces Settlements with Four Companies Related to Allegations they Deceived Consumers over Participation in the EU-U.S. Privacy Shield

By Rafael Moscatel, CIPM, CRM, IGP on

The Federal Trade Commission has reached settlements with four companies that allegedly misrepresented their participation in the EU-U.S. Privacy Shield framework, which enables companies to transfer consumer data legally from European Union countries to the United States. The FTC also alleged that two of the companies failed to comply with Privacy Shield requirements.

In separate actions, the FTC settled Privacy Shield cases against:

In addition to allegations that each company falsely claimed to participate in the EU-U.S. Privacy Shield framework, the FTC also alleged that Click Labs and Incentive Services falsely claimed to participate in the Swiss-U.S. Privacy Shield framework, which establishes a process for companies to transfer consumer data in compliance with Swiss law.

In its cases against Global Data and TDARX, the FTC further alleged that the companies continued to claim participation in EU-U.S. Privacy Shield after allowing their certifications to lapse, and that those companies failed to comply with the framework. The companies allegedly failed to verify annually that statements about their Privacy Shield practices were accurate, and failed to affirm that they would continue to apply Privacy Shield protections to personal information collected while participating in the program.

“The Privacy Shield Framework is critical to facilitating transatlantic commerce and assuring our European partners of our commitment to data protection,” said Andrew Smith, Director of the FTC’s Bureau of Consumer Protection. “Enforcement of the Privacy Shield framework is a priority of the FTC, and we will hold companies accountable where, as here, they fail to keep their Privacy Shield promises.”

The Department of Commerce administers both the EU-U.S. and Swiss-U.S. Privacy Shield frameworks, while the FTC enforces the promises companies make when joining the programs. With today’s announcement, the FTC has now brought a total of 21 enforcement actions related to the EU-U.S. Privacy Shield framework since it was established in 2016.

Under the settlements, all four companies are prohibited from misrepresenting their participation in the EU-U.S. Privacy Shield framework, as well as any other privacy or data security program sponsored by any government, or any self-regulatory or standard-setting organization. As part of their settlements, Global Data Vault and TDARX also are required to continue to apply the Privacy Shield protections to personal information they collected while participating in the program, or return or delete the information.

The Commission voted 5-0 to issue the proposed administrative complaints and to accept the consent agreements with the four companies. The FTC will publish a description of the consent agreement packages in the Federal Register soon. The agreements will be subject to public comment for 30 days after publication in the Federal Register after which the Commission will decide whether to make the proposed consent orders final. Once processed, comments will be posted on Regulations.gov.

NOTE: The Commission issues an administrative complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. When the Commission issues a consent order on a final basis, it carries the force of law with respect to future actions. Each violation of such an order may result in a civil penalty of up to $42,530.

Call us today at 323-413-7432, schedule a free consultation or visit us at www.capp-llc.com to learn more about our tailored privacy compliance solutions.

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Business Processes Information Security Privacy

CCPA Rulemaking Activities – Upcoming Hearings

By Rafael Moscatel, CIPM, CRM, IGP on

CPA Rulemaking Activities – Upcoming Hearings

On October 10, 2018, the Attorney General released proposed regulations for the California Consumer Privacy Act of 2018 (CCPA).  The California Department of Justice (DOJ) will hold four public hearings to provide all interested persons the opportunity to present statements or comments on the proposed regulations, as detailed below.  The hearings will begin promptly at 10:00 a.m. and will conclude when the last speaker has finished their presentation.  Please note that attendees may be required to go through building security before entering each venue.  For more information about the public hearings, and to RSVP, please visit: https://www.oag.ca.gov/privacy/ccpa/rsvp.

The deadline to submit written comments is December 6, 2019 at 5:00 p.m. (PST).  Comments may be submitted via email (PrivacyRegulations@doj.ca.gov), mail (Privacy Regulations Coordinator, California Office of the Attorney General, 300 South Spring Street, First Floor, Los Angeles, CA 90013), or at the public hearings.

Please visit www.oag.ca.gov/privacy/ccpa for information about the DOJ’s CCPA rulemaking process, including the following newly added pdfs:  Tips on Submitting Effective Comments and Information about the Rulemaking Process.

PUBLIC HEARING DATES

Sacramento
December 2, 2019; 10:00 a.m.
CalEPA Building
Coastal Room, 2nd Floor
1001 I Street
Sacramento, CA 95814

Los Angeles
December 3, 2019; 10:00 a.m.
Ronald Reagan Building
Auditorium, 1st Floor
300 S. Spring Street
Los Angeles, CA 90013

San Francisco
December 4, 2019; 10:00 a.m.
Milton Marks Conference Center
Lower Level
455 Golden Gate Ave.
San Francisco, CA 94102

Fresno
December 5, 2019; 10:00 a.m.
Fresno Hugh Burns Building
Assembly Room #1036
2550 Mariposa Mall
Fresno, CA 93721

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Professional Development

Say Hello To Pika, The Privacy Pup!

By Rafael Moscatel, CIPM, CRM, IGP on

Compliance & Privacy Partners provides smart and affordable privacy compliance, data governance and risk-management solutions designed to help organizations build privacy programs, assess, manage and remediate risks and demonstrate defensible compliance. We offer and support a variety of data privacy management platforms which include data subject fulfillment workflows, records and PI inventory management, vendor assessment and policy adherence tools, privacy impact assessments, file analysis projects and records retention enforcement.

Click here to take charge of your data challenges by contacting us today for a free consultation. We offer free 1-hour IG and CCPA workshops for interested companies.

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Information Security Privacy

California Company Settles FTC Allegations that it Falsely Claimed Participation in EU-U.S. Privacy Shield

By Rafael Moscatel, CIPM, CRM, IGP on

California Company Settles FTC Allegations that it Falsely Claimed Participation in EU-U.S. Privacy Shield

A California company has agreed to settle Federal Trade Commission allegations that it falsely claimed participation in the EU-U.S. Privacy Shield framework, which enables companies to transfer consumer data legally from European Union countries to the United States.

In its complaint, the FTC alleged that Medable, Inc.—which provides technology solutions to business customers operating in pharmaceutical, biotechnology, and research industries—falsely claimed in its privacy policy that it was a certified participant in the EU-U.S. Privacy Shield framework and adhered to the program’s principles. While the company initiated an application with the Department of Commerce in December 2017, it did not complete the steps necessary to participate in the framework.

The Department of Commerce administers the framework, while the FTC enforces the promises companies make when joining the program. With today’s announcement, the FTC has now brought a total of 17 enforcement actions related to the Privacy Shield framework since it was established in 2016.

As part of the settlement with the FTC, Medable is prohibited from misrepresenting its participation in the EU-U.S. Privacy Shield framework, any other privacy or data security program sponsored by the government, or any self-regulatory or standard-setting organization.

The Commission vote to issue the proposed administrative complaint and to accept the consent agreement with Medable was 5-0. The FTC will publish a description of the consent agreement package in the Federal Register soon. The agreement will be subject to public comment for 30 days after publication in the Federal Register, after which the Commission will decide whether to make the proposed consent order final. Once processed, comments will be posted on Regulations.gov.

NOTE: The Commission issues an administrative complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. When the Commission issues a consent order on a final basis, it carries the force of law with respect to future actions. Each violation of such an order may result in a civil penalty of up to $42,530.

Call us today at 323-413-7432, schedule a free consultation or visit us at www.capp-llc.com to learn more about our tailored privacy compliance solutions.

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Information Security Privacy

Google pushes out important updates about the California Consumer Privacy Act (CCPA)

By Rafael Moscatel, CIPM, CRM, IGP on

On Monday, November 18th, Google AdSense pushed out the following updates regarding the California Consumer Privacy Act:

from Google:

The California Consumer Privacy Act (CCPA) is a new data privacy law that applies to certain businesses which collect personal information from California residents. The new law goes into effect on January 1, 2020.
Google already offers data protection terms pursuant to the General Data Protection Regulation (GDPR) in Europe. We are now also offering service provider terms under the CCPA, which will supplement those existing data protection terms (revised to reflect the CCPA), effective January 1, 2020. For customers on our online contracts and updated platform contracts, the service provider terms will be incorporated into our existing contracts via the data protection terms. For such customers, there is no action required on your part to add the service provider terms into your contract.
These service provider terms will be made available alongside new tools for partners to enable restricted data processing. Restricted data processing is intended to help partners prepare for CCPA. Some partners may decide to send a restricted data processing signal for users who click a CCPA opt-out link. Other partners may decide to enable restricted data processing for all users in California via a control in our products. Subject to the service provider terms, we will act as your CCPA service provider with respect to data processed while restricted data processing is enabled. You can refer to this article for more information on restricted data processing and to determine whether restricted data processing meets your CCPA compliance needs. Please also refer to our Help Center articles for Ad Manager, AdMob, AdSense for more information on enabling restricted data processing.
Please see privacy.google.com/businesses for more information about Google’s data privacy policies.

Compliance & Privacy Partners provides smart and affordable privacy compliance, data governance and risk-management solutions designed to help organizations build privacy programs, assess, manage and remediate risks and demonstrate defensible compliance. We offer and support a variety of data privacy management platforms which include data subject fulfillment workflows, records and PI inventory management, vendor assessment and policy adherence tools, privacy impact assessments, file analysis projects and records retention enforcement.

Call us today at 323-413-7432, schedule a free consultation or visit us at www.capp-llc.com to learn more about our tailored privacy compliance solutions.

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Data Governance Information Security Information Technology Privacy

FTC Slaps InfoTrax and its CEO with Severe Cybersecurity Order

By Rafael Moscatel, CIPM, CRM, IGP on

Utah Company Settles FTC Allegations it Failed to Safeguard Consumer Data

As a result, hacker gained access to personal information of a million consumers, agency says

via FTC Press Release

A Utah-based technology company has agreed to implement a comprehensive data security program to settle Federal Trade Commission allegations that the company failed to put in place reasonable security safeguards, which allowed a hacker to access the personal information of a million consumers.

InfoTrax Systems, L.C., provides back-end operation services to multi-level marketers. This includes such services as compensation, inventory, orders, accounting, training, and data security, as well as operating its clients’ website portals.

In its complaint, the FTC alleges that InfoTrax and its former CEO Mark Rawlins failed to use reasonable, low-cost, and readily available security protections to safeguard the personal information it maintained on behalf of its clients. This includes failing to:

  • inventory and delete personal information it no longer needed;
  • conduct code review of its software and testing of its network;
  • detect malicious file uploads;
  • adequately segment its network; and
  • implement cybersecurity safeguards to detect unusual activity on its network.

In addition, the FTC alleged that InfoTrax stored consumers’ personal information—such as Social Security numbers, payment card information, bank account information, and user names and passwords—in clear, readable text on its network.

“Service providers like InfoTrax don’t get a pass on protecting sensitive data they handle just because their clients are other businesses rather than individual consumers,” said Andrew Smith, Director of the FTC’s Bureau of Consumer Protection. “As this case shows, it’s every company’s responsibility to protect customers’ personal information, especially sensitive data like Social Security numbers.”

As a result of the company’s security failures, a hacker infiltrated InfoTrax’s server, along with websites maintained by the company on behalf of clients, more than 20 times from May 2014 until March 2016. In March 2016, the intruder accessed about one million consumers’ sensitive personal information, according to the complaint.

InfoTrax did not detect these intrusions until March 2016, when it was alerted that its servers had reached maximum capacity. This alert was due to a data archive file created by the hacker who had infiltrated its network. InfoTrax’s security failures not only affected its network but also the websites of its clients, the FTC alleges.

The personal information that the intruder obtained can be used to commit identity theft and fraud. The FTC alleges that InfoTrax’s failure to provide reasonable security for personal data in its care violated the FTC’s prohibition against unfair practices.

As part of the proposed settlement with the FTC, InfoTrax and Rawlins are prohibited from collecting, selling, sharing, or storing personal information unless they implement an information security program that would address the security failures identified in the complaint. This includes assessing and documenting internal and external security risks; implementing safeguards to protect personal information from cybersecurity risks; and testing and monitoring the effectiveness of those safeguards.

In addition, the proposed settlement requires the company to obtain third-party assessments of its information security program every two years. Under the order, the assessor must specify the evidence that supports its conclusions and conduct independent sampling, employee interviews, and document review. Finally, the order grants the Commission the authority to approve the assessor for each two-year assessment period.

The Commission vote to issue the administrative complaint and to accept the proposed consent agreement with InfoTrax and Rawlins was 5-0. Commissioner Christine S. Wilson released a concurring statement.

The FTC will publish a description of the consent agreement package in the Federal Register soon. The agreement will be subject to public comment for 30 days after publication in the Federal Register after which the Commission will decide whether to make the proposed consent order final. Once processed, comments will be posted on Regulations.gov.

NOTE: The Commission issues an administrative complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. When the Commission issues a consent order on a final basis, it carries the force of law with respect to future actions. Each violation of such an order may result in a civil penalty of up to $42,530.

Compliance & Privacy Partners provides smart and affordable privacy compliance, data governance and risk-management solutions designed to help organizations build privacy programs, assess, manage and remediate risks and demonstrate defensible compliance. We offer and support a variety of data privacy management platforms which include data subject fulfillment workflows, records and PI inventory management, vendor assessment and policy adherence tools, privacy impact assessments, file analysis projects and records retention enforcement.

Call us today at 323-413-7432, schedule a free consultation or visit us at www.capp-llc.com to learn more about our tailored privacy compliance solutions.

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