OVERNIGHT TECH: Calls continue for data breach law

THE LEDE: Federal officials and private executives will keep up the call for lawmakers to pass new data security legislation on Wednesday.

In a hearing with the House Energy and Commerce subcommittee on Commerce, Manufacturing and Trade, Federal Trade Commission (FTC) Chairwoman Edith Ramirez will repeat the call for a “strong federal data security and breach notification law.”

“Never has the need for legislation been greater,” she will say, according to her prepared remarks. “With reports of data breaches on the rise, and with a significant number of Americans suffering from identity theft, Congress needs to act.”

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The comments echo her remarks in the Senate Judiciary Committee on Tuesday. In that hearing, she said that the commission would welcome a bill setting a national standard for notifying people of possible data breaches. She also called for legislation that secures the FTC’s ability to seek civil penalties for companies that don’t adequately protect customers’ data.

Currently, 46 states and the District of Columbia have some form of data breach notification law. Retailers have said that forces them to comply with a patchwork of rules.

Bob Russo, the general manager at the PCI Security Standards Council, which sets industry standards, will say that simplifying those requirements and “promoting information sharing between public and private sector” are some of the ways the government can work to protect data.

Federal officials should not be in the business of setting data security standards, however, he will note.

“The Council believes that the development of standards to protect payment card data is something the private sector, and PCI specifically, is uniquely qualified to do. It is unlikely any government agency could duplicate the expansive reach, expertise, and decisiveness of PCI.”

William Noonan, deputy special agent in charge at the Secret Service’s cyber operations branch, will tell members of the subcommittee that “legislative action could help to improve the Nation’s cybersecurity, reduce regulatory costs on U.S. companies, and strengthen law enforcement’s ability to conduct effective investigations.”

The hearing will be the third this week on data privacy issues, in the wake of a series of data breaches that have captured the public’s attention. As many as 110 million Target shoppers could have had their personal or financial information stolen in an attack on the company’s servers last year.

John Mulligan, the Minneapolis-based retailer’s chief financial officer, will repeat the apology he made to the Senate Judiciary Committee on Tuesday when he testifies on Wednesday, according to his prepared remarks.

“I want to say how deeply sorry we are for the impact this incident has had on our guests — your constituents,” he is planning to tell lawmakers. “We know this breach has shaken their confidence in Target, and we are determined to work very hard to earn it back.”

Libraries left out?: Libraries should have been a bigger part of Tuesday’s remarks by President Obama about increasing resources for the ConnectedED initiative, the American Library Association said Tuesday. The ConnectED initiative — managed by the Federal Communications Commission (FCC) — has the goal of connecting American classrooms to high-speed Internet.

On Tuesday, Obama announced that $750 million in charitable commitments have been made by tech and telecom companies to expand resources for the ConnectED program. Tuesday’s announcement followed a report from over the weekend that the FCC would restructure current funding to double the program’s funding to $2 billion over the next two years.

Emily Sheketoff, executive director of the American Library Association's Washington Office, said the president’s announcement failed to take into account the role of libraries.

“The President opened his remarks with his commitment to significant investments in education. But he missed the mark in a few key ways,” she said in a statement.

“First, he failed to recognize the importance of an effective school library program. ConnectED must include professional development and support for school librarians, in addition to broadband access and devices, to ensure students have the digital literacy and research skills necessary to effectively use those devices.”

Feds indict Silk Road owner:  The Justice Department has formally indicted Ross Ulbricht, the creator and owner of the online illicit marketplace Silk Road, months after his arrest.

Ulbricht, 29, allegedly created the marketplace and ran it from 2011 until it was shut down by federal officials in October. While in operation, the website became notorious for offering drugs and other illegal products in exchange for bitcoins, a relatively anonymous type of virtual currency.

“Silk Road emerged as the most sophisticated and extensive criminal marketplace on the Internet, serving as a sprawling black-market bazaar where unlawful goods and services, including illegal drugs of virtually all varieties, were bought and sold regularly by the site’s users,” the Justice Department claimed on Tuesday.

Under the moniker “Dead Pirate Roberts,” the department claims that Ulbricht oversaw “every aspect” of the site and raked in tens of millions of dollars’ worth of commissions. According to the federal charges, he tried to solicit six hired murders while running the website, though there is no evidence that they were ever carried out.

Ulbricht was arrested in San Francisco last October, when Silk Road was shut down.

He has been charged with narcotics conspiracy and engaging in a continuing criminal enterprise, both of which carry a maximum penalty of life in prison. He has also been charged with conspiring to commit computer hacking and conspiring to launder money.

TechNet gets new chief: A former official in the Clinton White House will head up the high tech trade group TechNet. Linda Moore, who served as Clinton’s deputy political director among other posts throughout her career in Washington, was named the new chief executive and president on Tuesday.

“I am honored to join TechNet and its members — visionary men and women who have changed the way people across the globe live, work and play,” she said in a statement. “I look forward to working with them to advocate for policies at the federal and state levels to ensure that America remains the high tech leader of the world and that the innovation economy continues to thrive.”

She previously spent time working for former Sen. Evan Bayh (D-Ind.), Democratic campaigns and the consulting firm LMF Strategies. 

 

ON TAP

The House Energy and Commerce subcommittee holds a hearing on data breaches at 9:30 a.m.

The House Homeland Security Committee is planning to mark up the National Cybersecurity and Critical Infrastructure Protection Act at 10:00 a.m.

At 11:00 a.m., FCC Chairman Tom Wheeler will unveil details about a new push to provide broadband Internet service to virtually all students.

FTC Commissioner Julie Brill is hosting a Twitter chat about privacy, big data and other issues starting at 2:00 p.m.

 

IN CASE YOU MISSED IT

Representatives from the retail giant Target apologized to lawmakers Tuesday for its recent data breach. 

Lawmakers bluntly warned the Obama administration it will lose its sweeping surveillance powers if major changes aren’t made at the National Security Agency (NSA). 

Federal officials at the NSA “probably” collect information about phone calls members of Congress make, a top Justice Department official said.

President Obama announced more than $750 million in charitable commitments from technology and telecom companies for a new effort to bring high-speed Internet to the classroom. 

Lobbyists for the tech industry say the U.S. Patent and Trademark Office is already understaffed and underfunded, and they question why the White House has let the director position sit vacant for more than a year.

 

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