Proposed Law Classifies Ransomware Infection as a Data Breach

The newly announced Act to Strengthen Identity Theft Protections in North Carolina proposes that ransomware attacks be treated as data breaches.

Unveiled last week by Attorney General Josh Stein and Rep. Jason Saine, the legislation proposes that, in addition to incidents where data is stolen, even unauthorized access to someone’s personal information should be considered a data breach.

Thus, ransomware attacks, where the victim’s personal information is only accessed, without being necessarily stolen, will be included in the definition of data breaches, and organizations will have to report these incidents as well. 

“As a result, the breached organization must notify both the people affected and the Attorney General’s office. If the breached entity determines that no one was harmed, it must document that determination for the Attorney General’s office to review,” the Act to Strengthen Identity Theft Protections reads (PDF).

The legislation requires tightened data protection (businesses will have to “implement and maintain reasonable security procedures and practices”) and quicker notifications (organizations must announce data breaches within 30 days).

Aiming to better protect individuals following a data breach, the act will allow impacted people to “place and lift a credit freeze on their credit report at any time, for free,” and dictates that consumer reporting agencies such as Equifax would have to “provide four years of free credit monitoring to those affected.” 

“Additionally, if a business experiences a breach, including social security numbers, that business must provide two years of free credit monitoring to those affected,” the legislation reads. 

The act also clarifies penalties for businesses that suffer data breaches and fail to maintain reasonable security procedures, requires organizations to ask for a person’s permissions when seeking to obtain or use a person’s credit report or credit score. 

The legislation also gives North Carolinians the right to request consumer reporting agencies to provide them with a listing of the information maintained on them, sources from where it was gathered, and a list of any person or entity to which it was disclosed.

The initiative to strengthen North Carolina’s identity theft protection is accompanied by a breach report (PDF) revealing that a total of 1,057 data breach notices were reported to the North Carolina Department of Justice. More than 1.9 million North Carolinians were affected in those incidents. The report also reveals that accidental release and display breaches increased in 2018. 

“Last year, more than 1.9 million North Carolinians were estimated to have been affected by a data breach. This number is way too high. North Carolina’s laws on this issue are strong – but they need to be even stronger. Rep. Jason Saine and I want to do everything we can to keep people’s personal information safe,” Attorney General Stein commented. 

Related: State vs. Federal Privacy Laws: The Battle for Consumer Data Protection

Related: California, Home of Silicon Valley, Ramps Up Online Privacy Law