FEDERAL WAY, Wash. – CUNA board member and President/CEO of Woodstone Credit Union Susan Streifel on Tuesday testified on behalf of credit unions and other proponents of legislation that would make the costs associated with data breaches such as the massive TJX debacle the responsibility of the data breacher.
The proposed legislation, which was written by the Washington CU League, requires negligent data breachers to reimburse card-issuing financial institutions for the costs associated with protecting their members or customers following a data breach.
The WCUL said bill would deter financial fraud and identity theft in three ways: first, by requiring businesses accepting plastic cards to encrypt or dispose of sensitive consumer data promptly; second, by making businesses storing sensitive consumer data who fail to meet basic security standards responsible for the costs of consumer notification and card replacement; and third, by establishing a safe harbor for businesses who meet basic security standards.
“The League was delighted to have someone as passionate as Susan testify on behalf of this bill,” WCUL President/CEO John Annaloro said. “As a point of sound public policy, this proposed legislation provides a powerful financial incentive for data custodians to live up to generally accepted security standards.”
