NOTICE OF THIRD SET OF PROPOSED MODIFICATIONS TO TEXT OF CCPA REGULATIONS

Pursuant to the requirements of Government Code section 11346.8, subdivision (c), and section 44 of Title 1 of the California Code of Regulations, the California Department of Justice (Department) is providing notice of a third set of proposed modifications made to the regulations regarding the California Consumer Privacy Act.    

The Department first published and noticed the proposed regulations for public comment on October 11, 2019.  On February 10, 2020 and March 11, 2020, the Department gave notice of modifications to the proposed regulations, based on comments received during the relevant comment periods.  The Department withdrew the following sections from the review of the Office Administrative Law (OAL) pursuant to Government Code section 11349.3, subd. (c):  999.305(a)(5), 999.306(b)(2), 999.315(c), and 999.326(c).  OAL approved the other sections submitted by the Department, effective August 14, 2020, and these provisions became final.

The modifications are indicated by bold blue underline for proposed additions and red strike out for proposed deletions to the regulations that became effective on August 14, 2020.  This third set of modifications include the following changes:

  • Proposed section 999.306, subd. (b)(3), provides examples of how businesses that collect personal information in the course of interacting with consumers offline can provide the notice of right to opt-out of the sale of personal information through an offline method.
  • Proposed section 999.315, subd. (h), provides guidance on how a business’s methods for submitting requests to opt-out should be easy and require minimal steps.  It provides illustrative examples of methods designed with the purpose or substantial effect of subverting or impairing a consumer’s choice to opt-out.
  • Proposed section 999.326, subd. (a), clarifies the proof that a business may require an authorized agent to provide, as well as what the business may require a consumer to do to verify their request.
  • Proposed section 999.332, subd. (a), clarifies that businesses subject to either section 999.330, section 999.331, or both of these sections are required to include a description of the processes set forth in those sections in their privacy policies.

This Notice, the text of the third set of proposed modifications to the regulations, and a comparison of the text as approved by the Office of Administrative Law with the currently proposed modifications are available at www.oag.ca.gov/privacy/ccpa/current.  The originally proposed regulations and all documents relating to the rulemaking package, including previous modifications to the proposed regulations, are also available at this website.

The Department will accept written comments regarding the proposed changes between Tuesday, October 13, 2020 and Wednesday, October 28, 2020. Please limit comments to the additions indicated in bold blue underline and the deletions indicated in red strike out.  All written comments on the underlined changes must be submitted to the Department no later than 5:00 p.m. on October 28, 2020 by email to PrivacyRegulations@doj.ca.gov, or by mail to the address listed below.

It’s Not The Crime, It’s The Cover Up – Former Uber Security Chief Charged Over Covering Up 2016 Data Breach

The federal prosecutors in the United States have charged Uber’s former chief security officer, Joe Sullivan, for covering up a massive data breach that the ride-hailing company suffered in 2016.

According to the press release published by the U.S. Department of Justice, Sullivan “took deliberate steps to conceal, deflect, and mislead the Federal Trade Commission about the breach” that also involved paying hackers $100,000 ransom to keep the incident secret.

“A criminal complaint was filed today in federal court charging Joseph Sullivan with obstruction of justice and misprision of a felony in connection with the attempted cover-up of the 2016 hack of Uber Technologies,” it says.

The 2016 Uber’s data breach exposed names, email addresses, phone numbers of 57 million Uber riders and drivers, and driver license numbers of around 600,000 drivers.

The company revealed this information to the public almost a year later in 2017, immediately after Sullivan left his job at Uber in November.

Later it was reported that two hackers, Brandon Charles Glover of Florida and Vasile Mereacre of Toronto, were behind the incident to whom Sullivan approved paying money in exchange for promises to delete data of customers they had stolen.

All this started when Sullivan, as a representative for Uber, in 2016 was responding to FTC inquiries regarding a previous data breach incident in 2014, and during the same time, Brandon and Vasile contacted him regarding the new data breach.

“On November 14, 2016, approximately 10 days after providing his testimony to the FTC, Sullivan received an email from a hacker informing him that Uber had been breached again.”

“Sullivan’s team was able to confirm the breach within 24 hours of his receipt of the email. Rather than report the 2016 breach, Sullivan allegedly took deliberate steps to prevent knowledge of the breach from reaching the FTC.”

According to court documents, the ransom amount was paid through a bug bounty program in an attempt to document the blackmailing payment as bounty for white-hat hackers who point out security issues but have not compromised data.

“Uber paid the hackers $100,000 in BitCoin in December 2016, despite the fact that the hackers refused to provide their true names (at that time),” federal prosecutors said. “In addition, Sullivan sought to have the hackers sign non-disclosure agreements. The agreements contained a false representation that the hackers did not take or store any data.”

“Moreover, after Uber personnel were able to identify two of the individuals responsible for the breach, Sullivan arranged for the hackers to sign fresh copies of the non-disclosure agreements in their true names. The new agreements retained the false condition that no data had been obtained. Uber’s new management ultimately discovered the truth and disclosed the breach publicly, and to the FTC, in November 2017.”

Just last year, both hackers were pleaded guilty to several counts of charges for hacking and blackmailing Uber, LinkedIn, and other U.S. corporations.

In 2018, British and Dutch data protection regulators also fined Uber with $1.1 million for failing to protect its customers’ personal information during a 2016 cyber attack.

Now, if Sullivan found guilty of cover-up charges, he could face up to eight years in prison, as well as potential fines of up to $500,000.

California Privacy Act – What Businesses Need To Do, Now.

After much anticipation, the California Attorney General (AG) announced in early June 2020 that the final California Consumer Protection Act (CCPA) regulations were being submitted to the Office of Administrative Law (OAL) for review. Once approved by the OAL, the final regulation text will be filed with the Secretary of State and become enforceable by law.

Because enforcement of the CCPA began on July 1, 2020, now is the time for covered businesses and service providers to size-up their compliance efforts. Although there are many issues that remain unclear, the regulations may provide a road map to the AG’s enforcement priorities. Among the issues addressed by the final regulations—as well as the AG’s “Final Statement of Reasons” which accompanied those regulations— are the following:

  • Privacy Policy: A business’ privacy policy must inform consumers of their rights under the CCPA and how they can submit requests to know or delete personal information. In addition, the privacy policy should disclose the categories of personal information collected, the categories of personal information disclosed for a business purpose or sold to a third party and provide on a per category basis the categories of third parties to whom the information was disclosed or sold.
  • Required Notices: The final regulations detail the information that should be included in the various notices. They also require business to use “plain, straightforward language” and a format that draws the consumer’s attention to the notice. In addition, the AG clarified that the regulations do “not require a cookie banner, but rather leave it to businesses to determine the formats that will best achieve the result in particular environments. In other words, it appears that the use and nature of tracking technologies can be disclosed in the privacy policy assuming that policy is readily available to the public.
  • Service Providers: The regulations require that service providers use the personal information they receive from businesses “to process or maintain personal information on behalf of the business … and in compliance with the written contract for services required by the CCPA,” except in certain narrowly-defined circumstances, such as building or improving the quality of their services. If an entity qualifies as a service provider, the transfer of information from a business to them is not deemed a sale. Moreover, the Final Statement of Reasons clarifies that service providers do not lose their status as service providers merely because they collect consumers’ personal information directly, if that collection is performed at the business’s direction and on behalf of that business.
  • Subcontractors: The regulations provide that service providers may hire subcontractors, as long as the subcontractors meet all the requirements for a “service provider” set forth in the CCPA and the regulations.
  • User-Enabled Privacy Controls: Businesses must honor privacy controls that clearly communicate or signal that the consumer intends to opt out of the sale of personal information.
  • Training and Recordkeeping: The regulations require training for all individuals responsible for handling consumer inquiries. Businesses must also retain records of consumer requests and how the business responded to such request for 24 months.
  • No Discrimination: A business cannot discriminate against a consumer for exercising his or her rights under the CCPA.

CCPA Regulations Update

NOTICE OF MODIFICATIONS TO TEXT OF PROPOSED REGULATIONS AND ADDITION OF DOCUMENTS AND INFORMATION TO RULEMAKING FILE

Update to Proposed Text

Pursuant to the requirements of Government Code section 11346.8, subdivision (c), and section 44 of Title 1 of the California Code of Regulations, the California Department of Justice (Department) is providing notice of changes made to the proposed regulations regarding the California Consumer Privacy Act, which were published and noticed for public comment on October 11, 2019.  These changes are in response to comments received regarding the proposed regulations and/or to clarify and conform the proposed regulations to existing law.  The originally proposed regulations, this Notice, the text of the proposed regulations as modified, and a comparison of the text as originally proposed with the modifications, are available at www.oag.ca.gov/privacy/ccpa.

Update to Documents and Other Information Relied Upon

Pursuant to the requirements of Government Code sections 11346.8, subdivision (d), 11346.9, subdivision (a)(1), and 11347.1, the Department is also providing notice that documents and other information which the Department has relied upon in adopting the proposed regulations have been added to the rulemaking file and are available for public inspection and comment.

The documents and information added to the rulemaking file are as follows:

Accenture Interactive, See people, not patterns. (2019). Available at https://www.accenture.com/_acnmedia/PDF-110/Accenture-See-People-Not-Patterns.pdf.

Cranor, et al., Design and Evaluation of a Usable Icon and Tagline to Signal an Opt-Out of the Sale of Personal Information as Required by CCPA (February 4, 2020).

Douglis, et al., How the CCPA impacts civil litigation (January 28, 2020).  Available at https://iapp.org/news/a/how-the-ccpa-impacts-civil-litigation/#.

Duffy, et al., Retail Loyalty Programs Will Survive Calif. Privacy Law (September 26, 2019), Law360.  Available at https://www.law360.com/articles/1202393/print?section=california.

Paternoster, Leon, Getting round GDPR with dark patters. A case study: Techradar (August 12, 2018).  Available at https://www.leonpaternoster.com/posts/techradar-gdpr/.

Simon, et al., Summary of Key Findings from California Privacy Survey (October 16, 2019), Goodwin Simon Strategic Research.  Available at https://www.caprivacy.org/post/icymi-summary-of-key-findings-from-california-privacy-survey.

World Wide Web Consortium, Web Content Accessibility Guidelines, version 2.1 (June 5, 2018).  Available at https://www.w3.org/TR/2018/REC-WCAG21-20180605/.

The Department is also providing notice that it will not be including the following study in the rulemaking file.

Javelin Strategy & Research, 2019 Identity Fraud Study: Fraudsters Seek New Targets and Victims Bear the Brunt (March 6, 2019).

The entire rulemaking file, which includes the documents referenced above, is available for inspection and copying throughout the rulemaking process during business hours at the location listed below.  In addition, some of the documents are available at www.oag.ca.gov/privacy/ccpa.

The Department will accept written comments regarding the proposed changes or materials added to the rulemaking file between Friday, February 7, 2020 and Monday, February 24, 2020. All written comments must be submitted to the Department no later than 5:00 p.m. on February 24, 2020 by email to PrivacyRegulations@doj.ca.gov, or by mail at the address listed below.

Lisa B. Kim, Privacy Regulations Coordinator
California Office of the Attorney General
300 South Spring Street, First Floor
Los Angeles, CA 90013
Email: PrivacyRegulations@doj.ca.gov

All timely comments received that pertain to the changes to the proposed regulations or the new materials added will be reviewed and responded to by the Department’s staff as part of the compilation of the rulemaking file.  Please limit written comments to those items.

NSA Releases Guidance on Mitigating Cloud Vulnerabilities

Original release date: January 24, 2020

The National Security Agency (NSA) has released an information sheet with guidance on mitigating cloud vulnerabilities. NSA identifies cloud security components and discusses threat actors, cloud vulnerabilities, and potential mitigation measures.

The Cybersecurity and Infrastructure Security Agency (CISA) encourages administrators and users to review NSA’s guidance on Mitigating Cloud Vulnerabilities and CISA’s page on APTs Targeting IT Service Provider Customers and Analysis Report on Microsoft Office 365 and other Cloud Security Observations for information on implementing a defense-in-depth strategy to protect infrastructure assets.

Rafael Moscatel is Managing Director of Compliance and Privacy Partners, a consulting firm specializing in data governance and privacy solutions. He is an award-winning Information Governance Professional (IGP), Certified Records Manager (CRM), Certified Information Privacy Manager (CIPM). Rafael has spent the last twenty years developing large-scale Information Management Programs for the Fortune 500 including Paramount Pictures and Farmers InsuranceReach him at 323-413-7432, follow him on Twitter at @rafael_moscatel or visit http://www.capp-llc.com to learn more.