Congress Eyes Customer Notification ForOnline Breaches

WASHINGTON - (11/09/05) -- A key congressional panel will holdhearings Wednesday on a bill that would clamp down on Internetsecurity breaches by, among other things, requiring credit unionsand banks to immediately notify their customers when their personalfinancial information has been compromised. Law enforcementofficials and financial privacy experts are among the witnessesscheduled to testify before the House Financial Servicessubcommittee on Financial Institutions. The Financial DataProtection Act of 2005, one of several pending bills on online datasecurity, would also create a national security standard thatrequires businesses to protect any sensitive consumer financialaccount or identity information they may possess; and have theTreasury, Federal Reserve and Federal Trade Commission developonline security standards which would be administered by NCUA andthe other regulators. CUNA said it supports proposals that wouldrequire the major credit card companies to notify their creditunions and banks when a data breach has occurred, and for thecredit unions and banks to be able to disclose the source of thebreach to the consumer.