Articles Posted in Cybersecurity

The National Security Agency (“NSA”) along with other government agencies (e.g., FBI, CIA) have expanded their surveillance programs after several terrorist attacks took place on domestic soil. It is a known fact that the federal government is systematically tracking domestic and international calls of its citizens. The surveillance program does not end there but also expands to text messages, internet browsing, and emails.

There is information that indicates the President’s Surveillance Program (“The Program”) was designed to assess, evaluate, gather, and analyze a tremendous amount of information with or without subpoenas or warrants. The Program is intended to disrupt actual or potential terrorist attacks that could be instigated by known or unknown criminals. The government has setup a massive collaboration effort with major telecommunication companies to gather information that would usually not be subject to surveillance. The telecommunication service providers have given access to the NSA to install surveillance equipment (e.g., “fiber-optic splitter”) which makes an exact copy of the data that’s passing through their systems and sends it to the government. Also, other special equipment such as the “Narus Semantic Traffic Analyzer” has been installed on the telecommunication systems to conduct deep packet inspections. These analyzers are capable of assessing and sifting through large data segments (e.g., 10 gigabits) and internet traffic.

These pervasive surveillance programs were authorized by President Bush after September 11, 2001. There is real time access to internet traffic and telephone records that was not previously available for previous surveillance programs. Also, the electronic information is being gathered in real time and stored on secure databases.

The governments of many countries have initiated surveillance programs to protect national security. These programs were allegedly designed and instigated to fight against terrorism and other criminal activities. For example, the British Government has setup a similar program to the United States government’s PRISM  program which is called TEMPORA. The GCHQ, which stands for Government Communications Headquarters, is the British government’s spy agency that operates similar to the United States National Security Agency (“NSA”). There is information that confirms the GCHQ has placed data interceptors on fiber optic cables to analyze internet communications. There is also information that confirms approximately 10 gigabits of data per second (or 21 petabytes of data per day) is being reviewed per day by this spy agency. Its agents are charged with the task of storing all sorts of information – e.g., electronic information with correlating metadata – on computer servers for as long as thirty days. This spy agency uses a technique called Massive Volume Reduction (“MVR”) to conduct its analysis.

Government spy agencies share their intelligence with other nation’s agencies as part of a partnership program. In fact, several years ago, The Guardian publicized this massive information gathering after it was reported by Edward Snowden. It seems the GCHQ is operating under two principles: (1) Mastering the Internet; and (2) Global Telecoms Exploitation. These surveillance programs are meant to gather as much information as possible for evaluation and assessment. However, it seems these principles have not been opened up for public debate and are being carried out without warrants.

The government spy agencies are gathering phone records, email message content, social media communications, and other types of information in an effort to curtail criminal violations. Their targets may include the unsuspecting innocent and suspicious or guilty individuals. Therefore, there are two schools of thought here. First, the spy agencies should carry out their intelligence gathering to prevent another international tragedy such as 9/11. Second, the spy agencies should be subject to certain limitations and should be forced to obtain lawful warrants before conducting surveillance. On the other side, the government officials argue that this type of unprecedented wiretapping is necessary to properly safeguard the country from terrorists.

The United States government has implemented surveillance programs to promote national security. These programs are designed to gather and process electronic information that could arguably assist government agencies in their efforts to enhance national security. However, there is an argument being made that the federal government is using the resources of major communication service providers to obtain records of citizens without legal justification. In other words, the government is engaging in unlawful surveillance programs without probable cause.

What kind of programs have been implemented?

The National Security Agency (“NSA”) has been intercepting internet communications for several years without fully disclosing the nature and extent of its surveillance programs to the general public. It’s also collecting other types of communication records such as phone records and related electronic information. There is evidence that proves AT&T is cooperating with government surveillance programs. The evidence seems to indicate the telecommunication giant has installed fiberoptic splitters to copy and send information to the government. Experts have argued this kind of activity is beyond “wiretapping” since it’s surveilling the entire communication channels without a warrant. So, in essence, the government is engaging in the mass collection of telephone metadata of all domestic customers. The government officials have argued that this type of broad surveillance is justified under the USA Patriot Act which is meant to deter and punish terrorism and enhance law enforcement investigations for the following reasons:

Cybersecurity risk management has become a more challenging endeavor recently. It was never an easy task for commercial enterprises, but now that we’re facing a global pandemic and economic recession, there are additional challenges. At this point, most of our personal information is being transmitted and stored on the internet. Third-party cloud service providers have become a useful variable in the equation but they can also become a liability if there is a cybersecurity incident. Therefore, cybersecurity risk management has become more difficult especially since commercial enterprises share personal or confidential information with third parties.

The fact that our personal information is no longer in our possession or control makes cybersecurity risk management more challenging. Now, if, our personal information was stored in one location, and as such, was in one company’s possession, life would have been easier. However, multiple vendors, and third-party service providers gain access to our confidential information. So, the level of liability rises to a different stage since there is additional potential responsibilities that must be managed. In addition, some companies have allowed their employees to work from home and this business model makes it more difficult to manage cybersecurity risks. In other words, remote employees can become the proverbial “weakest link” which can be quite dangerous for the commercial enterprise.

A problem in the cybersecurity risk management formula is that change is never ending. The constant change in technology and law makes it more difficult for companies and their information technology managers to keep up. Our law firm’s cybersecurity lawyers generally recommend working with computer technology experts on a regular basis. This way, they can develop the necessary policies on their networks. They should identify the risks by understanding the cybersecurity rules and regulations. An information technology manager should implement internal and external policies to secure the network which usually holds confidential information. For example, the network should have a secure software or hardware firewall, encryption algorithm, and multi-factor authentication system. The information technology manager should develop and implement regular training sessions for employees.

Cybersecurity risk management requires proper due diligence on the company’s cybersecurity program. This is an important aspect because the company’s executives owe a fiduciary duty towards their shareholders and customers. In other words, a company’s manager or director should take every reasonable measure to ensure the safety and security of the company’s intellectual properties, trade secrets, and other sensitive or confidential information. As such, a claim or cause of action for breach of fiduciary duty can seriously hinder business operations and should be avoided by any means necessary.

We recommend properly assessing internal and external threats such as disgruntled employees or third-party contractors who were given access to the computer network system. It’s certainly possible for a disgruntled employee to insert a flash drive which yields malware into the network server to cause a malfunction. Therefore, it is important to have the right security measures implemented on the computer network system. For example, our cybersecurity lawyers recommend installing an Intrusion Detection System (“IDS”) to detect unauthorized access to sensitive or confidential files. It is important to review and understand the laws related to workplace monitoring because it could trigger workplace privacy right violations. There are state and federal laws that would impact the legal rights and responsibilities of employers and employees so it’s important to understand them. In fact, companies that fall under the definition of “critical infrastructure” organizations pursuant to Executive Order 13636 should consider implementing insider threat programs as a precautionary measure.

It’s recommended to have an enterprise risk assessment program that involves cybersecurity experts and lawyers. These computer and legal experts should join forces to establish a program that addresses the key issues – e.g., data privacy, data protection, insider threats, breach notification protocols. It’s important to have a plan before the so-called “cyber incident” so the key players will know their responsibilities. This way, when an incident takes place, there will be a preexisting protocol for everyone. Moreover, having access to a cybersecurity attorney is crucial to the company’s legal and ethical responsibilities. Our law firm advises its clients regarding the relevant state, federal, and international rules and regulations as we have the necessary background and expertise in internet, technology, and cybersecurity laws.

Cybersecurity risk management is a key component in avoiding cybersecurity incidents. Our law firm assists clients with breach response plans pursuant to the rules and regulations. An Incident Response Plan (“IRP”) should be carefully created to address cybersecurity incidents. There are strategic challenges with implementing an effective IRP within the organization but there could also be legal challenges. Hence, we encourage clients to implement a cybersecurity framework that can effectively prevent breaches. This can be done by working with qualified legal and computer experts.

We encourage clients to coordinate communications with their employees and representatives. The company’s partners and affiliates should also be aware of the breach notification and prevention protocols. This is especially important if the company has various locations and satellite offices. The company must act quickly when it finds out about a breach so that it can follow the rules and regulations. In fact, the European Union’s General Data Protection Regulation (a/k/a “GDPR”) mandates breach notification to the proper authorities within three days. In addition, in California, the law imposes a 72-hour breach notification obligation under the California Consumer Privacy Act (“CCPA”) which became effective on January 1, 2020.

We encourage clients to develop different types of response plans for various cybersecurity incidents. There are different types of breach that can take place on the computer network. In general, the bad actors compromise the computer network to steal personal information. However, availability attacks have also increased which in essence deny access to the system. For example, installing ransomware on the computers or launching a Distributed Denial of Service (“DDoS”) attack on the computer network can accomplish this task. There could be serious legal consequences if the company cannot properly protect its network which yields private and confidential information – e.g., intellectual property, trade secrets. There are various state, federal, and international laws in this context. For example, the Philippines Data Privacy Act defines a “security incident” as an event or occurrence that affects or tends to affect data protection or may compromise availability, integrity, or confidentiality.

Smart devices are being sold to consumers and businesses on a regular basis. They include smart phones, smart cars, smart televisions, smart thermostats, smart doorbells, smart bulbs, smart locks, smart watches, smart speakers, smart refrigerators, and other electronic devices. These smart devices can be recording you or collecting personal data without your knowledge or consent.

Privacy in the internet and technology age has become a major concern. This is primarily due to the existence and availability of smart devices which are even referred to as “smart spies” because they can record and transfer personal information to the hackers who use technical flaws to install spyware. This is why it’s important to review the security settings of the smart device on a regular basis. For example, smart televisions are connected to the internet, and if they are hacked into, they can easily be used for nefarious purposes. Smart speakers and digital assistants are listening to voices and that is why they can be a threat source for their users. They are constantly collecting information with or without the user’s knowledge or consent. There may be a way to delete the recently-recorded information by telling the smart device to delete the last conversation but consumers should read the user’s manual to learn about the options.

Smart doorbells, which are part of a home’s security surveillance system, have cameras and are connected to the internet. Therefore, they can be hacked into and used to record activities. For example, Ring has been questioned for sharing video recordings with police departments and third-party service providers such as Facebook and Google without the user’s knowledge or consent. It is important to view the “authorized client devices” feature to understand which device is accessing the account.

Cybersecurity and privacy rules have changed the private and public sectors’ landscapes. The state and federal rules are changing the ways private and public organizations are managing their operations. These rules are focusing on privacy, security and regulations in all jurisdictions but uniformity is an issue. Therefore, state and federal legislators should ensure uniformity to avoid regulatory and enforcement contradictions.

The State of California has enacted laws to promote cybersecurity within its jurisdiction. For example, Assembly Bill 89 (“AB 89”) was enacted to ensure information sharing should be conducted in a way that protects an individual’s privacy and civil liberties, confidential information, preserves business confidentiality, and enables public officials to detect, investigate, and prevent network security breaches. It has also enacted the California Consumer Privacy Act (“CCPA”) that allows individuals to file a legal action against businesses that fail to implement and maintain reasonable security measures to protect their personal information. Now, “reasonable security measures” may include using a firewall, encryption, and intrusion detection software on their computer networks.

The State of New York has enacted laws to promote cybersecurity within its jurisdiction. For example, it has passed the Stop Hacks and Improve Electronic Data Security Act (“SHIELD Act”) to protect consumers from exposure of private information from cybersecurity attacks. This statute is designed to increase data protection and data breach notification requirements for commercial enterprises. It is meant to hold business organizations responsible for gathering and storing consumer personal information which may include a name, address, telephone number, email address, date-of-birth, and social security number.

Cybersecurity is the most important measure for protecting your personal and confidential information. There are cybersecurity incidents taking place on a daily basis. In general, most targets are companies and individuals who yield confidential information such as financial documents. This way, the hackers can use the information to promote their illegal acts or violations. In fact, it is known they use malware and spam to infiltrate electronic devices and extract confidential information.

Spam has been prolifically used by hackers to target victims. The hackers use this method to send unsolicited emails to victims. In other words, they ask them to click on a link or download a file which unbeknownst to the victim contains malware. Then, once the victim has downloaded the malware, his or her computer will be infected. The virus will extract personal information and send it back to the hacker. The virus may also use a “keylogger” to track the victim’s activities. It can track and record the victim’s financial transactions and find a way to log into his/her bank accounts.

Hackers can find their victims by using several methods. For example, phishing scams have been used to lure their victims into traps. They use instant messages and text messages to contact their victims. The hackers use these methods to take the victim’s usernames and passwords without authorization. They will try to gain access to the victim’s financial accounts and extract funds without authorization. As a result, the hackers will ruin the victim’s credit by opening up credit card or mortgage accounts without authorization. They can obtain cash advances if they gain access to the financial information. They will also utilize the victim’s social security number to engage in fraudulent activities.

Data breach incidents have caused a significant amount of complications for business owners and their customers. The statistics show that at least 50% or more of companies have been targeted by hackers. So, the lawmakers have taken steps to promulgate laws to protect the victims and penalize the bad actors.

Data Breach Notification Laws

Every state has some form of data breach notification legislation that requires business owners to give notice to consumers about a data breach that has resulted in the unauthorized acquisition of unencrypted personal information. These laws usually require the business owners to give notice to the consumers in the most efficient manner. They may require the business owners to notify the Attorney General’s office if the business is required to notify a significant number of residents in that state. They also grant a “private right of action” (i.e., the right to file a lawsuit) to the victim in order to seek legal and equitable damages.