Data Breaches and State Disclosure Laws

[mandy]

Bananas.com was caught off guard last year. The musical instrument sales site suffered a data breach that was followed swiftly by a double whammy of consequences.

Roughly 250 customer records were exposed, likely after an individual stole an administrative password by accessing systems remotely. (Site owner Bananas at Large has since put additional security procedures in place to prevent a recurrence.)

After the breach, the 25-person company scrambled to comply with the many state laws requiring customer notification. It alerted only the affected customers, either by mail or e-mail. Because its own resources were limited, Bananas referred victims to large credit-reporting agencies to monitor for subsequent financial damage from the breach.

Despite its efforts, Bananas apparently failed to meet all the various state notification requirements and was subsequently slammed with fines and fees by major credit companies...

full article: http://ecommercetimes.com/story/After-th...60257.html