Let me preface this blog entry by saying that I'm not a lawyer, but I think if you read the references I'm pointing you to, you won't have to be to reach the same, logical conclusion. I am offering my own informed opinion regarding how a new Massachusetts law might affect the data security standards on websites you might manage. If you happen to be a lawyer with expertise in this area, I welcome your informed legal opinion as a blog comment.
There has been some FUD recently about a new law in Massachusetts: 201 CMR 17.00: STANDARDS FOR THE PROTECTION OF PERSONAL INFORMATION OF RESIDENTS OF THE COMMONWEALTH. I think this law is a great example of something that should exist at a Federal level, but I'll save that editorial for another time. I want to correct some misperceptions I see appearing in the technical media.
The first piece of mis-information comes from this 'article' at SQL Server Magazine. That article specifically says "if you store personal information like first and last names of Masachusetts residents", runs through a sample calculation of losing a database of 1,000 names, calculates a nightmare fine of five million dollars, and then shows you a link to where you can find out tons of information about 'upgrading' to Microsoft SQL server. The article's very first point about 'first and last names' is completely false, and I'll prove it to you.
Second, the venerable nerd news site Slashdot has a story with a link to that very same article, along with a few hundred comments from industry leaders through pimply-faced 14-year-olds, and everyone in between, with conclusions ranging from 'don't worry about it' through 'possession of a phone book is now illegal'. Slashdot might be a great place to read about linux hacking, but is not a great place for legal advice.
I wanted to understand for real what this law might mean to my clients. After all, virtually every site we maintain with user accounts has data that could be construed as "personally identifiable information"... especially by the slashdot crowd. I wanted to make sure we comply. So I tried to read the text of the law directly from the Massachusetts Government Website.
I found something interesting: the text of this law doesn't read like some obscure tax code - it actually reads more like something I'm familiar with - requirements for implementing software. This law, at least the technical burden it would place on us, was very understandable.
The majority of my questions were answered right on page 2, under definitions:
Personal information, a Massachusetts resident's first name and last name or first initial and last name in combination with any one or more of the following data elements that relate to such resident: (a) Social Security number; (b) driver's license number or state-issued identification card number; or (c) financial account number, or credit or debit card number, with or without any required security code, access code, personal identification number or password, that would permit access to a resident’s financial account; provided, however, that “Personal information” shall not include information that is lawfully obtained from publicly available information, or from federal, state or local government records lawfully made available to the general public.
Read that carefully - its not just the first and last name - it is the first and last name in combination with one or more of (a) Social Security Number, (b) one of several state-issued IDs, (c) one of several pieces of financial information. The combination is what leads to a violation, and that makes perfect sense.
Notice also there is an exemption for "information that is lawfully obtained from publicly available information, or from federal, state or local government records lawfully made available to the general public".
Clearly, this law isn't talking about "first and last names of Massachusetts residents" as the SQLServer article would have you believe. Surprise, surprise, an article in a magazine named after a commercial software product is more interested in selling you said commercial product than offering you legal advice. Clearly, phone books are not illegal in the state of Massachusetts. Again, I'm not a lawyer, but I don't think I need to be to reach that conclusion.
But how might it affect the design of a website for a client?
If you are a tech firm designing websites that financial information of the type covered by this law, than you should already be aware of the Payment Card Industry Data Security Standard. If you are, then the contents of this law shouldn't surprise you. If you aren't, then I hope a million dollar fine puts you out of business, because that would make our whole industry more secure.
Both this law and the PCI-DSS specify some pretty sane policies on everything from the encryption of data in the database through the physical security of the machines that store that data, and includes sane definitions on what constitutes a breach, and how this sensitive data should be stored, used, transmitted, and transferred. This new Massachusetts law specifies who has this duty under the law, and extends these sane policies for sites that store social security numbers and other state-issued IDs. That is a great thing, and is pretty easy for a good tech firm to do for you. An even better tech firm will ask you "are you sure you want to be collecting that stuff in the first place?"...
Other Salient Sections of the Law
There are two sections of this law that pertain to technologists rather than lawyers: 17.03: Duty to Protect and Standards for Protecting Personal Information outlines the policies and procedures you and your company should have in place to safeguard data, and 17.04: Computer System Security Requirements outlines the security mechanisms and acess restrictions that should be on your servers, such as the usage of user IDs and passwords, restricted access for administration, firewalls, virus scanning, and so on. These sections are written well enough to be an auditing template for your technical staff to follow. I'll take this opportunity to give our company a plug - if you'd like an independent opinion on how your compliance fares, give us a call.
Should this be a Model for the Nation?
Why do I think this could be a good starting point for a Federal law? First, because if I'm doing this properly for Massachusetts, it would actually be more work to not do it for every other state out there. Second, the law doesn't say anything about things like your passport ID number, a federal Tax ID number, or the like, probably because the State doesn't have jurisdiction over the Federal space. Third, I think I have proven above the exemptions for publically available data and the 'in combination with' clause make this a pretty rational law. And finally, with a Federal law, there won't be a million variants to support... and I'm sure several companies would come out with compliance and auditing services (like Sarbanes-Oxley), and I'll be able to prove our worth to a client by having the systems we design and implement sail through those with flying colors.