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New Yorks SHEILD (Stop Hacks and Improve Electronic Data) act is now in place. Broadening the scope of the 2005 New York ‘Information Security Breach and Notification Act’ by expanding notification rules for companies for any personal or company who licences private information to report data breaches.
The fine regime is relatively light, the Attorney General (AG) can fine upto $250k for a breach. Placing the right of action into the hands of the AG, not permitting a private right of action. What the article points out is that whilst the fines are small, the associated act requires reasonable safeguards to be implemented. Which will place the onus on a company to define reasonable, in line with current best practices.
Whilst the fines are relatively small, the costs associated with defending a case in court wont be. With costs for remediation, brand, loss reputation, legal and expert fees likely to be much greater than the potential fine.
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