arrow_back Back to App

Data Breach Compensation Act: New FTC Oversight and Penalties for Credit Agencies

This Act establishes an Office of Cybersecurity within the Federal Trade Commission (FTC) to supervise data security at consumer reporting agencies. It mandates strict cybersecurity standards and imposes significant financial penalties on agencies responsible for data breaches involving sensitive personal information. Crucially, 50% of the collected penalties will be distributed directly to affected consumers as compensation.
Key points
Creation of FTC Cybersecurity Office: A new office will supervise and examine credit reporting agencies (CRAs) to ensure compliance with data security requirements.
Mandatory Consumer Compensation: In case of a breach, 50% of the civil penalties collected will be fairly divided among affected consumers (e.g., $100 for basic data plus $50 for each additional piece of exposed information).
Severe Penalties for Breaches: Penalties can reach up to 50% of the CRA's gross annual revenue. This penalty is doubled (up to 75% of revenue) if the agency fails to notify the FTC within 10 days or violates security standards.
Rapid Notification Requirement: CRAs must notify the FTC within 10 days of a breach and inform affected consumers and the public on an expeditious and practical timeline.
Strict Security Standards: CRAs must implement rigorous technical measures, including encryption for data at rest and in transit, continuous monitoring, and meeting or exceeding NIST cybersecurity framework standards.
article Official text account_balance Process page
Expired
Citizen Poll
No votes cast
Additional Information
Print number: 118_S_5449
Sponsor: Sen. Warren, Elizabeth [D-MA]
Process start date: 2024-12-05
Lustra uses Artificial Intelligence. Verify details in source documents.
Summarized by: gemini-flash-latest
Source data: api.congress.gov
AI work logs for this document launch

OFFICIAL LEGAL TITLE

Data Breach Prevention and Compensation Act of 2024

FREQUENTLY ASKED QUESTIONS

What is the official ID of this bill?

The official print number for this legislation is 118_S_5449.

Which chamber initiated this legislation?

This legislation was initiated in the Senate.

When did the legislative process begin?

The process officially started on 2024-12-05.

What are the main provisions?

Key points include:

  • Creation of FTC Cybersecurity Office: A new office will supervise and examine credit reporting agencies (CRAs) to ensure compliance with data security requirements.
  • Mandatory Consumer Compensation: In case of a breach, 50% of the civil penalties collected will be fairly divided among affected consumers (e.g., $100 for basic data plus $50 for each additional piece of exposed information).
  • Severe Penalties for Breaches: Penalties can reach up to 50% of the CRA's gross annual revenue. This penalty is doubled (up to 75% of revenue) if the agency fails to notify the FTC within 10 days or violates security standards.
  • Rapid Notification Requirement: CRAs must notify the FTC within 10 days of a breach and inform affected consumers and the public on an expeditious and practical timeline.
  • Strict Security Standards: CRAs must implement rigorous technical measures, including encryption for data at rest and in transit, continuous monitoring, and meeting or exceeding NIST cybersecurity framework standards.
What is the specific legal status?

The current status is Expired.

Where can I read the full text of this legislation?

The full official text is available at: View full text

Who is the primary sponsor?

The primary sponsor is Sen. Warren, Elizabeth [D-MA].

What is the latest detailed status?

The latest detailed status is: Introduced in Senate

Is this summary verified?

Yes. This content was analyzed by AI and verified by the Lustra Judge System on 2025-12-26.

CATEGORIES

Security Economy Courts and Law