On Feb. 6, 2024, the U.S. Department of Health and Human Services’ (HHS) Office for Civil Rights (OCR) announced a $4.75 million settlement with New York non-profit health system Montefiore Medical Center over alleged malicious insider conduct that caused potential violations of the Health Insurance Portability and Accountability Act (HIPAA) Security Rule. This settlement follows two other recent investigations that led to OCR’s first-ever settlements stemming from ransomware and phishing attacks.
Continue Reading OCR Continues Holding Healthcare Entities Accountable for Protected Health Information Breaches
Don’t Forget: It’s Time to Notify the FTC of Your Data Breach
This summer, the Federal Trade Commission (“FTC”) will once again tighten the belt on entities that offer financial products and services when another round of amendments to the Gramm-Leach-Bliley Safeguards Rule goes into effect—this time, requiring covered entities to report data breaches to the FTC.
What is the Safeguards Rule?
The Safeguards Rule, which originally became effective in May 2003, long had a small bark and an even tinier bite. The rule required covered entities to develop, implement, and maintain a comprehensive written information security program with “appropriate” safeguards. With no private right of action and a breathtaking lack of specificity, this requirement was treated as little more than a suggestion by many covered entities. Continue Reading Don’t Forget: It’s Time to Notify the FTC of Your Data Breach
CNPD v. Amazon, the largest GDPR fine on record – what do we know so far?
Amazon’s financial records have revealed that the Luxembourg data protection supervisory authority, the Commission Nationale pour la Protection des Données (“CNPD”), is fining the retailer’s European arm (Amazon Europe Core S.à.r.l.) an eyewatering 746 million euros (£636m or $838m) for breaches of the EU’s General Data Protection Regulation (“GDPR”).
When the GDPR was introduced in May 2018, the potential for huge financial sanctions grabbed many headlines: it gives European supervisory authorities the power to impose fines of up to 20 million euros or 4% of annual global turnover (whichever is greater) for breaches of the GDPR. There have been some undeniably sizeable fines issued under the GDPR in the last three years. But the level of this particular fine is extraordinary: it’s the largest GDPR fine issued to date by a considerable margin. The second largest fine ever imposed under the GDPR was a comparatively paltry 50 million euros, levied against Google by CNIL (the French supervisory authority) in early 2019 (which you can read about here).Continue Reading CNPD v. Amazon, the largest GDPR fine on record – what do we know so far?
DOL’s New Cybersecurity Guidance
On April 14, 2021, the United States Department of Labor (the “DOL”) issued for the first time guidance to retirement plan sponsors, fiduciaries, record keepers, service providers and plan participants guidance on cybersecurity issues. The DOL’s press release includes three pieces of guidance, including: (1) Tips for Hiring Service Providers; (2) Cybersecurity Program Best Practices; and (3) Online Security Tips.
The Employee Benefits Security Administration, a sub-agency of the DOL (the “EBSA”) long ago stated that addressing cybersecurity has been on the agency’s “to do” list and even published a report in 2016 reflecting the need for such guidance, which we previously covered here.
The Employee Retirement Income Security Act of 1974, as amended (“ERISA”), includes fiduciary standards that require a retirement plan to be administered in accordance with a standard of care for a prudent person who is familiar with such matters. Common sense dictates that ERISA fiduciaries administer their plans in accordance with industry standards for cybersecurity, safeguard plan assets and ensure that appropriate controls are in place to avoid financial losses to plans that may result from a cybersecurity breach. However, the legal issues concerning who is responsible (plan participant, plan sponsor or record keeper) remain open questions in many jurisdictions.Continue Reading DOL’s New Cybersecurity Guidance
SEC Announces 2021 Information Security Examination Priorities – Five (5) Steps Every Firm Should Take to Prepare!
“Information security is critical to the operation of the financial markets and the confidence of its participants. . . The Division is acutely focused on working with firms to identify and address information security risks, including cyber-attack related risk . . .” SEC Division of Examinations, 2021 Examination Priorities, at 24.
On March 3, 2021, the Securities and Exchange Commission’s newly renamed Division of Examinations (EXAMS) (formerly the Office of Compliance Inspections and Examinations (OCIE)) announced its 2021 examination priorities. Information security and operational resiliency ranked number two out of the top five priorities sending a clear message that the SEC is focused on emergent security threats, particularly cyber-attacks, resulting from the sudden and unprecedented increase in remote operations.Continue Reading SEC Announces 2021 Information Security Examination Priorities – Five (5) Steps Every Firm Should Take to Prepare!
Data Privacy Day 2021: Privacy and Cybersecurity Are On Our Minds, Too
Data privacy is a top concern for many in-house legal professionals – and for good reason – data privacy and cybersecurity legal requirements are complex and continually evolving. Data Privacy Day is a great day to start addressing your organization’s data privacy and cybersecurity needs.
On Data Privacy Day 2021, here is what is top of mind for some of our Data Privacy & Security Team members:
- Andrew Konia – A Federal Privacy Law: “Calls (pleas?) for federal privacy legislation are nothing new, and last year we came close, with both parties presenting draft bills for consideration (surprise, neither passed!). But now, with the White House and both chambers of Congress under Democratic control, there appears to be renewed (and more serious) interest in a federal privacy law. We have seen (admittedly narrow) hints of the federal government taking a stronger stance on cybersecurity standards with the IoT Cybersecurity Improvement Act of 2020, which applies to federal agency purchases. But you take the recent and intense backlash on “Big Tech’s” use/sharing of data and perceived lack of data transparency, and mix in the Biden Administration’s prioritization of consumer protection generally, and you have the recipe – and a strong political appetite – for a comprehensive federal privacy law.”
- Bethany Lukitsch – California: “CPRA will be here before we know it, and most companies are going to have a lot to do to get ready. Updating privacy policies and adding ‘do-not-share’ links are one thing, but as with CCPA, it’s the behind-the-scenes work that is really going to take some time. It’s certainly not too early to get started.”
Continue Reading Data Privacy Day 2021: Privacy and Cybersecurity Are On Our Minds, Too
5th Circuit Weakens HHS’ Ability to Enforce HIPAA Safeguards
Healthcare providers and other covered entities are not required by HIPAA regulations to have “bulletproof” protections for safeguarding patient information stored in electronic form, according to a January 14, 2021 decision of the 5th U.S. Circuit Court of Appeals. In University of Texas M.D. Anderson v. U.S. Department of Health and Human Services, the 5th Circuit vacated a $4.3 million civil monetary penalty imposed by the U.S. Department of Health and Human Services (HHS) against the University of Texas’ M.D. Anderson Cancer Center.
The case arises from three separate incidents where M.D. Anderson employees lost laptops and USB thumb drives that contained unencrypted protected health information (PHI) for more than 34,000 patients. M.D. Anderson reported the breach incidents to HHS’ Office for Civil Rights (OCR), the office tasked with enforcing HIPAA. As a result of the reported breaches, OCR ordered M.D. Anderson to pay $4.3 million in civil monetary penalties (CMPs). M.D. Anderson appealed the decision to an HHS administrative law judge and to the HHS Departmental Appeals Board (DAB), both of which upheld OCR’s penalties. M.D. Anderson argued that the HIPAA regulations do not require encryption, that it complied with the regulations and employed other effective measures to safeguard electronic protected health information (ePHI), that the three incidents were the fault of staff who violated M.D. Anderson’s policies, and that the proposed CMPs were excessive.Continue Reading 5th Circuit Weakens HHS’ Ability to Enforce HIPAA Safeguards
Hacked Patient Records Land Athens Orthopedic Clinic in Hot Water with OCR
The U.S. Department of Health and Human Services Office for Civil Rights (OCR) reached a settlement for $1,500,000 and entered into a substantial corrective action plan with Athens Orthopedic Clinic (AOC) as a result of AOC’s alleged systemic noncompliance with the Health Insurance Portability and Accountability Act (HIPAA) Privacy and Security Rules. AOC, located in Georgia, provides a wide range of orthopedic services to approximately 138,000 patients a year.
Problems began for AOC in June 2016, when the practice was notified by a journalist that AOC patient records may have been posted for sale on the internet. Shortly thereafter, AOC was contacted by a hacker demanding payment for the stolen patient records. It was later determined that the hacker had accessed AOC’s electronic medical records using a vendor’s credentials on June 14, 2016, and continued to access protected health information (PHI) until July 16, 2016. AOC filed a breach report with OCR on July 29, 2016, revealing that the names, dates of birth, social security numbers, and other PHI of over 200,000 patients had been compromised by this breach.Continue Reading Hacked Patient Records Land Athens Orthopedic Clinic in Hot Water with OCR
Update: Coronavirus Cyberscams and Other Attacks – Scammers Are Still at It
The global coronavirus pandemic continues on, and the cyberattacks and scams continue to multiply. In the midst of the pandemic, hackers are capitalizing on fears surrounding the outbreak by crafting COVID-19-themed attacks aimed at infecting computers with malware or obtaining sensitive, personal information. Below are some of the latest examples of attacks and vulnerabilities to be aware of:
Continue Reading Update: Coronavirus Cyberscams and Other Attacks – Scammers Are Still at It
Coronavirus Cyber Scams: Outbreak Map Used to Spread Malware and Cyber Attack Experienced by the HHS
In the midst of the coronavirus pandemic, hackers are capitalizing on fears surrounding the outbreak by crafting COVID-19-themed attacks aimed to infect computers with malware or obtain sensitive, personal information.
For example, readers may be familiar with a popular interactive dashboard created by Johns Hopkins University using real-time data from the World Health Organization to track the spread of the virus. It has become a go-to source for many wishing to stay up to date on the virus. Recently hackers have circulated links via social media, email attachments and online advertisements to malicious websites that are disguised as the university’s COVID-19 map. However, the deceptive links open an applet that, when installed, infect the device with malware designed to steal personal data such as login credentials, banking information and other sensitive data. To ensure you are accessing the “real” COVID-19 map, directly access it through Johns Hopkins’ official home page, rather than clicking any unidentified links or searching the internet.Continue Reading Coronavirus Cyber Scams: Outbreak Map Used to Spread Malware and Cyber Attack Experienced by the HHS