Massachusetts AG Says Having a WISP is Not Enough to Comply With Massachusetts Data Security Regulations
The Massachusetts Attorney General’s Office and Belmont Savings Bank have agreed to resolve allegations that Belmont Savings Bank has violated the Commonwealth’s stringent data security regulations (see our post about 201 CMR 17.00 here) through an Assurance of Discontinuance, which has been filed in Massachusetts state court (see document here). Belmont Savings Bank has agreed to pay a civil penalty of $7,500 and has also agreed to institute new security and training procedures following a breach in May 2011, when an employee left a computer backup tape on a desk overnight, rather than in a storage vault. A surveillance camera showed that the backup tape was inadvertently discarded by the evening cleaning crew and, according to the Attorney General’s Office, was likely incinerated by the bank’s waste disposal company.
While there is no evidence indicating that any customer’s personal information has been acquired or used by an unauthorized person or used for an unauthorized purpose, the Assurance of Discontinuance states that if actual harm to customers results, the Attorney General’s Office will reopen discussions in order to determine appropriate restitution. This is the first settlement related to a violation of the Commonwealth’s relatively new data security regulations. While the Attorney General’s Office entered into a consent agreement with a restaurant chain in April 2011 for data security failures, that alleged breach occurred before the new data security regulations went into effect on March 1, 2010. (See our post about this consent agreement here.)