By Dan Goodin for The Register. This story was
reproduced with permission.
Assembly Bill 779 was championed by advocates
of consumers and credit card issuers amid the fallout of a massive
data breach in which online thieves stole account information
belonging to more than 45.6 million people from TJX Companies. TJX
was widely criticized for storing more information than necessary
and for failing to lock down its network.
The bill, among other things, would have specified the
information firms must provide when they experience a data breach
and would have required retailers to safeguard data in ways that
are more stringent than the current methods spelled out by the
Payment Card Industry Data Security Standard. The bill also
prohibited the maintaining of "sensitive authentication data
subsequent to authorization, even if that data is encrypted."
In vetoing the measure, Schwarzenegger seemed to suggest that
consumer information was already adequately safeguarded by the
marketplace.
"This industry has the contractual ability to mandate the use of
these standards, and is in a superior position to ensure that these
standards keep up with changes in technology and the marketplace,"
he said in a message to members of the California State
Assembly. "This measure creates the potential for California law to
be in conflict with private sector data security standards."
© The Register
2007
