National Data Security Bill Now Doubtful

WASHINGTON – Legislation to protect credit unions and their members from data security breaches has been put on the back burner by Congress and its future left in doubt, key lawmakers said this week. Congressman Barney Frank, chairman of the House Financial Services Committee, said after speaking to NAFCU’s Congressional Caucus he has backed off the issue somewhat as other priorities have emerged and consensus has become elusive on a data security measure. Frank, who had hoped to introduce his own version of a data security bill this fall, said it won’t take place until next year. Several other committees in both the House and Senate have competing versions of a data security bill and there is no clear consensus in Congress on how to deal with the growing threat of data security and identity theft. But the Massachusetts Democrat said he has been swayed by credit unions in his home state who are lobbying to bring more accountability at the point of data breaches. Frank said he was convinced by HarborOne CEO Jim Blake, whose credit union has paid hundreds of thousands of dollars to notify members of third-party breaches and to block and reissue cards. As a result, Frank said he supports measures to require parties that cause a breach to notify all of its customers, including credit unions, banks and consumers, and to pay the costs to resolve the events, including notification of members by credit unions, and to reissue cards. "We’re going to put the burden on the people who made the mistake, if we do a data bill," he said.