House Committee Passes Data Security Bill for Consumer Protection

A House committee this week unanimously approved a data security law that would establish federal standards for protecting personal information and would supersede state laws. The Data Accountability and Trust Act, (HR 4127), is one of a spate of bills introduced last year in the wake of publicity about the theft or loss of data that could lead to identity theft. The incidents came to light as a result of state laws requiring consumer notification of security breaches and spurred a consumer demand for tighter regulation.

Data brokers and other companies subject to multiple state laws also have called for a single federal law. The DATA Act is one of the first bills to move out of committee. It was approved Wednesday by a 41 to 0 vote in the House Energy and Commerce Committee. The bill would require the Federal Trade Commission to establish security requirements for interstate businesses holding personal information in an electronic form. Requirements include creating security policies, naming a point person for information security and the use of state-of-the-art security practices.

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