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FTC wants to be enforcer of data security

Jaikumar Vijayan | Dec. 16, 2013
The agency wants the U.S Congress to grant it authority to go after companies that fail to provide adequate data security

LabMD also contends that the FTC lacks jurisdiction to regulate patient information.

Several influential trade groups, including the Chamber of Commerce, TechFreedom, the American Hotel and Lodging Association, the National Federation of Independent Businesses, the International Franchise Association and Cause of Action support the positions taken by Wyndham and LabMD against the FTC.

Scott Vernick, an attorney specializing in data security with Fox Rothschild in Philadelphia, tracked the opposition to the FTC's growing tendency to charge companies with unfair trade practices over a data breach.

"If you had a national standard, you would know at a minimum what to do" to meet those requirements, Vernick said. But without such a standard, many feel that the FTC is trying to enforce its own arbitrary set of security requirements on companies. "Today, we don't know something is unfair until the FTC tells us it is unfair," he said. "A lot of the time we are guessing about what they want."


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