Last month, the Virginia Consumer Data Protection Act was signed into law, making Virginia the second state in the nation to enact comprehensive data privacy legislation.  The Act resembles and adopts some terms from the California Consumer Privacy Act (“CCPA”); the California Privacy Rights Act of 2020, which amends and expands the CCPA; and the

On March 3, 2021, the U.S. Securities and Exchange Commission (“SEC”) Division of Examinations (the “Division”)—formerly the Office of Compliance Inspections and Examinations—released its 2021 Examination Priorities (“2021 Priorities”).  The 2021 Priorities generally retain perennial risk areas as the Division’s core focus, but do include several new and emerging risk areas reflecting broader policy shifts under new SEC leadership.

The 2021 Priorities include:  retail investors; information security and operational resilience; financial technology (“Fintech”), including digital assets; anti-money laundering; transition from the London Inter‑Bank Offered Rate (“LIBOR”); several areas covering registered investment advisers and investment companies; market infrastructure; and oversight of the Financial Industry Regulatory Authority and Municipal Securities Rulemaking Board programs and policies.  Although not formal priorities, the Division will also focus on climate-related risks and environmental, social and governance (“ESG”) matters in light of recent market developments and broader attention in these areas.
Continue Reading Turning the Page: Highlights of the SEC’s Division of Examination’s 2021 Priorities

Recently, the New York Department of Financial Services (“DFS”) issued two memoranda addressing the ongoing increase in cyberattacks.  The first recent guidance provides best practices for insurance entities with regard to cyber insurance.[1]  The second guidance deals with the surge in benefits fraud that has been ongoing since the beginning of the COVID-19 pandemic, with directions on how regulated entities can best secure data.[2]
Continue Reading New York Department of Financial Services Issues New Guidance on Cyber Threats

Last month, in Guo Wengui v. Clark Hill, PLC, the United States District Court for the District of Columbia granted Plaintiff’s motion to compel production of Defendant’s third-party forensic investigation report following a cybersecurity incident.[1]  The court held that the forensic report was not covered by the attorney-client privilege or the work product doctrine, providing a cautionary tale for companies conducting post-breach investigations.
Continue Reading D.C. District Court Rejects Privilege Claim for Post-Data Breach Forensic Report

On January 6, 2021, a bipartisan group of state legislators introduced the “Biometric Privacy Act,” (Assembly Bill 27), which would make New York only the second state with a private right of action against entities that improperly use or retain biometric information.  This is the third time that New York lawmakers have proposed such a bill.

The bill would protect individuals’ biometric identifiers, defined as fingerprints, voiceprints, retina or iris scans, and scans of face or hand geometry, as well as information based on such identifiers used to identify an individual.[1]

Under the bill, private entities in possession of biometric identifiers or information would need to develop and comply with publicly available written policies establishing retention schedules and guidelines for permanently destroying the identifiers or information when the initial purpose for collecting or obtaining them has been satisfied or within three years of the individual’s last interaction with the entity, whichever occurs first.  Private entities would also be required to store, transmit, and protect from disclosure all biometric identifiers and information using the reasonable standard of care in their industry, and in a manner that is the same as or more protective than the manner in which they store, transmit, and protect other confidential and sensitive information.
Continue Reading New York Lawmakers Introduce Biometric Privacy Bill with Private Right of Action

Main Takeaways

Recommendations 01/2020 of the European Data Protection Board (the “EDPB”) on measures that supplement transfer tools to ensure compliance with the EU level of protection of personal data (the “Recommendations”)[1] attempt to provide a step-by-step roadmap to help EU data exporters transfer personal data outside the EU to third countries in a manner consistent with the judgment of the Court of Justice of the European Union (the “CJEU”) handed down on July 16, 2020, in Data Protection Commissioner v. Facebook Ireland and Maximillian Schrems (“Schrems II”, further described in Section 1 below).[2] The Recommendations were published on November 11, 2020 and can be relied upon immediately, even though they are subject to public consultation, with comments being due prior to December 21, 2020.
Continue Reading Recommendations of the EDPB Further to the CJEU’s Schrems II Judgment: One Step Forward, Two Steps Back?

In the wake of one of the largest reported medical ransomware attacks in U.S. history,[1] the U.S. Department of the Treasury, Office of Foreign Assets Control (OFAC) and Financial Crimes Enforcement Network (FinCEN) issued last week a pair of advisories to assist in efforts to combat the increasing threat of ransomware attacks and related sanctions and anti-money laundering (AML) compliance issues.[2]  Like our blog post last month on the same topic, the advisories highlight the importance of considering the legal risks relating to ransomware payments and confirm that OFAC may pursue enforcement actions against ransomware payments that violate U.S. sanctions.[3]
Continue Reading OFAC and FinCEN Issue Advisories on Cyber Ransom Payments

On September 15, 2020, the Securities and Exchange Commission issued a cease‑and‑desist order against Unikrn, Inc. concerning its 2017 initial coin offering  of UnikoinGold .  The SEC found that the Unikrn ICO violated the prohibition in Section 5 of the Securities Act of 1933 against the unregistered public offer or sale of securities.  The SEC imposed several remedies, including requiring Unikrn to permanently disable the UnikoinGold token and a civil money penalty of $6.1 million.
Continue Reading SEC Issues Enforcement Action Against Unikrn, Inc. for its ICO, Prompting Rare Public Dissent from Commissioner Hester Peirce

Last month, reports surfaced that fitness technology company Garmin may have made a multimillion dollar payment in response to a ransomware attack with reported links to Evil Corp, a Russian hacking group subject to U.S. sanctions.  This incident and other recent reports of ransomware attacks against large companies highlights that companies should consider potential civil and criminal liability under U.S. sanctions laws when responding to ransomware attacks.
Continue Reading Ransomware and Sanctions Compliance: Considerations for Responses to Attacks