Saturday, January 28, 2006

Government Warns Corporate America to Protect Customer Data

There have been a record amount of data breaches in the past couple of years. Millions of people have had their personal information compromised. It only makes sense that the government (who are supposed to protect the people) are looking into the reasons why it occurred.

The FTC has determined that Consumer data broker (Choice Point) failed to protect the information of 163,000 people.

In the FTC press release it states:

"At Least 800 Cases of Identity Theft Arose From Company’s Data Breach.

Consumer data broker ChoicePoint, Inc., which last year acknowledged that the personal financial records of more than 163,000 consumers in its database had been compromised, will pay $10 million in civil penalties and $5 million in consumer redress to settle Federal Trade Commission charges that its security and record-handling procedures violated consumers’ privacy rights and federal laws. The settlement requires ChoicePoint to implement new procedures to ensure that it provides consumer reports only to legitimate businesses for lawful purposes, to establish and maintain a comprehensive information security program, and to obtain audits by an independent third-party security professional every other year until 2026."

“The message to ChoicePoint and others should be clear: Consumers’ private data must be protected from thieves,” said Deborah Platt Majoras, Chairman of the FTC. “Data security is critical to consumers, and protecting it is a priority for the FTC, as it should be to every business in America.”

Here is the full press release, Choicepoint Settles Data Security Breach Charges; to Pay $10 Million in Civil Penalties, $5 ....

For years, corporations (notably the credit bureaus) have made billions off of selling our information. Here is a message that failing to take security seriously in their quest for profit may cost them dearly at a later date.

For all of us little people, you can now stop (slow down) information brokers from getting your personal information at By "opting out" the credit bureaus can no longer sell your personal data.

1 comment:

prying1 said...

Once again I have to wonder how much of this '$10 million in civil penalties and $5 million in consumer redress' is going to go to those who have been victims and who have suffered as a result of identity theft through choice point's 'errors'?

I'd love to bet that the majority of these funds will go to government agencies and lawyers but it might be a bit difficult to find someone to bet against me..