Michigan Proposes New Bill to Prevent Identity Theft

Michigan’s legislature has proposed a new bill to protect the personal information of individuals and prevent identity theft. This new bill, if enacted, would encourage businesses in the state to establish their own written cybersecurity programs in order to protect consumer information.

The Identity Theft Protection Act provides notice to individuals whose personal information has been affected by a breach and provides powers and responsibilities to certain agencies of the state and local governments to confront cybersecurity issues. It would further address penalties and remedies for cyber crimes, provide affirmative defenses for businesses that put in appropriate effort to prevent breaches, and outline steps to prevent identity theft.

According to the bill’s sponsor, State Senator Wayne Schmidt, Michigan has been ranked poorly among the states for its efforts to address cyber security, and this bill will help solve that. If it passes the legislature, the bill will provide an incentive for covered businesses to establish a written cybersecurity program that outlines administrative and technical procedures to protect individuals’ personal information.

Schmidt claims that this bill will encourage businesses to adopt the industry’s best practices to prevent identity theft and establish effective and well-written cyber security policies. Notably, the bill establishes potential penalties; however, it does not provide for enforcement of any of them.

According to Schmidt, this was intentional to leave compliance with these enforcement practices as a voluntary step. Instead of mandating compliance, the bill instead encourages it by providing a sort of affirmative defense. If a business is ever accused of failing to protect consumer data and is taken to court, they can show that they complied with the bill’s guidelines and made a good faith effort to prevent the loss.

However, some have questioned whether this affirmative defense is enough to encourage businesses to make an honest effort to do their best to protect consumer data. Instead of requiring businesses to meet stringent standards or risk penalties, some believe it may just provide protection from lawsuits. By demonstrating that they had a written procedure in place, they fear these businesses may be able to escape liability for lax security that leads to breaches.

Regardless, many support seeing legislation like this that supports policies to protect personal data. It waits to be seen whether this bill makes it to law. For now, it will be sent to Michigan’s Senate Energy and Technology Committee for review and further discussion.

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