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FTC Increases Targeting of Companies Lacking Cyber Protection

Client Alert
May 13, 2024

Here is how businesses can develop cyber strategies to mitigate breaches and financial risk.

The Federal Trade Commission (FTC) recently released a comprehensive cybersecurity report outlining key findings and recommendations based on emerging threats, trends in data breaches, and strategies for businesses to enhance their cybersecurity posture observed over the last year. The FTC strives to protect consumer privacy and respond to the evolving ways that companies use consumer data such as in the development of artificial intelligence models and misuse of health data. 

Importantly, the report emphasized the need for proactive measures to mitigate risks and highlighted the FTC’s initiative in targeting companies that fail to implement reasonable data security measures to protect consumer data. 

Here are some key strategies for businesses: 

  1. Risk Assessment and Management: Conduct regular risk assessments (at least annually) to identify potential vulnerabilities and prioritize them based on their potential impact on the business. Develop and implement a risk management plan to address these vulnerabilities effectively.
  2. Cyber Security Policies and Procedures:  Implement basic cybersecurity policies to protect its assets, data, and operations from cyber threats.
  3. Employee Training and Awareness: Educate employees about cybersecurity best practices, such as recognizing phishing emails, using strong passwords, and reporting suspicious activity. Regular training exercises help reinforce awareness.
  4. Access Control and Privilege Management: Implement strong access controls to limit user privileges and restrict access to sensitive data and systems. Use multi-factor authentication (MFA) where possible to add an extra layer of security.
  5. Data Encryption: Encrypt sensitive data to protect it from unauthorized access. 
  6. Patching: Keep software and systems up to date with the latest security patches to address known vulnerabilities. Establish a patch management process to ensure timely deployment of patches across the organization.
  7. Network Security: Deploy firewalls, intrusion detection/prevention systems, and other network security measures to monitor and protect against unauthorized access and malicious activity. Segment networks to limit the spread of potential breaches.
  8. Incident Response Plan: Develop a comprehensive incident response plan that outlines procedures for detecting, containing, and mitigating cybersecurity incidents. Test the plan regularly through tabletop exercises and simulations.
  9. Vendor Risk Management: Assess the security practices of third-party vendors and service providers to ensure they meet your organization's security standards. Include contractual clauses that outline security requirements and responsibilities.
  10. 10. Cyber Insurance: Consider obtaining cyber insurance to mitigate financial risks associated with cybersecurity incidents, such as data breaches or business interruptions.

By adopting a proactive approach to cybersecurity and implementing these strategies, businesses can enhance their cybersecurity posture and better protect themselves against evolving threats and complying with ever increasing legal obligations.  

BMD assists companies design and implement a strategy to achieve technical and organizational controls to bolster cybersecurity and data protection.  

If you have any questions regarding this topic and how to protect your company's data, please contact BMD Member Brandon Pauley at btpauley@bmdllc.com.

Cybersecurityfederal trade commissionBrandon PauleyConsumer PrivacyArtificial Intelligence
Client Alert

UPDATE - Vaccine Policy Considerations for Employers

January 4, 2021If you read our post from November, you’re already an informed employer. This first post of 2021 is to share good news, give a few updates, and answer some other common questions. Q: What’s the Good News? First, the EEOC confirmed that employers may require employees receive the COVID-19 vaccine. Second, polling indicates that the number of Americans who said they will receive a vaccine has increased from around 63% to over 71%. The number of Americans who are strongly opposed to a vaccine is about 27%. Third, initial returns show that the efficacy rate for certain vaccines is as high as 95% for some at-risk recipients.Client Alert

Changes to FFCRA Paid Leave: Congress’ Revisions to Employment COVID-19 Leave Benefits Signals the Light is at the End of the Tunnel

December 28, 2020Late in the evening on December 27th, President Trump signed into law the government’s $900 billion COVID-19 relief package (the “Stimulus Bill”). Among other economic stimulus benefits, the Stimulus Bill contains the $600 stimulus checks that will be issued to eligible individuals as well as, relevantly, changes to the Families First Coronavirus Response Act (“FFCRA”). The FFCRA was implemented in April 2020 and provided benefits to individuals who missed work as a result of an actual or suspected COVID-19 illness or to care for a child when their school or childcare service was closed because of COVID-19. Importantly, the Stimulus Bill extends eligibility for employer payroll tax refunds for leave payments made to employees on or before March 31, 2021 under the FFCRA, signaling to the American people that Congress believes many of the employed public will be vaccinated by this time, the light at the end of the tunnel. However, the Stimulus Bill does contain a caveat that employers are no longer required to provide FFCRA leave benefits after December 31, 2020, but if they do, they will receive the payroll tax credits, up to the maximums provided in the FFCRA, for payments made prior to April 1, 2021. Below we provide a list of questions and answers we received to date following the passage of the Stimulus Bill. We expect the U.S. Department of Labor (“DOL”) to issue additional questions and answers as the Stimulus Bill is implemented, and we will update this Client Alert as these are received.Client Alert

Healthcare Speaker Programs: New OIG Alert

December 11, 2020In a rare Special Fraud Alert issued on November 16, 2020 (the “Alert”), the Office of Inspector General (“OIG”) urged companies who host speaker programs to reassess their programs in light of the “inherent risks” associated with these activities. The Alert reports that, in the last three years, drug and device companies have reported paying nearly $2 billion to health care professionals for speaker-related services.Client Alert

Value-Based Care Advances – CMS Issues New Final Rules for Stark and Anti-Kickback Statutes

December 11, 2020The Centers for Medicare & Medicaid Services (“CMS”) and the Department of Health and Human Services (“HHS”) Office of the Inspector General (“OIG”) issued two highly anticipated (and quite extensive) Final Rules to reform the Stark Law and Anti-Kickback Statute (“AKS”) regulations. The Final Rules generally take effect on January 19, 2021. The Final Rules include new safe harbors for the AKS and new exemptions to the Stark Law to allow for greater flexibility. According to the HHS, the goal of updating both laws is to make it easier for providers to engage in care coordination and value-based care programs without running afoul of the statutes. Please note that this client alert could not cover the full extent of the Final Rule changes so please contact your BMD Healthcare attorney with questions.Client Alert

Mandatory Filings Under CFIUS New Rules

December 11, 2020On September 15, 2020, the Committee on Foreign Investment in the United States (“CFIUS”) promulgated a final rule modifying its mandatory declaration requirements for certain foreign investment transactions involving “TID US businesses” (sensitive U.S. businesses dealing in critical technologies, critical infrastructure and sensitive personal data) dealing in “critical technologies” – i.e., U.S. businesses that produce, design, test, manufacture, fabricate, or develop one or more critical technologies. The new rule also makes amendments to the definition of the term “substantial interest” (used to determine whether a foreign government has a substantial interest in an entity). The final rule became effective on October 15, 2020.
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