FTC Approves Consent Order in CVS Case

Following a public comment period, the Commission has approved a final consent order in the CVS Caremark case involving failure to adequately secure customers’ medical and financial data.

Prior coverage of the case can be found here. Additional documents on the case can be found here. According to the complaint, CVS Caremark did not implement reasonable policies and procedures to dispose securely of personal information, did not adequately train employees, did not use reasonable measures to assess compliance with its policies and procedures for disposing of personal information, and did not employ a reasonable process for discovering and remedying risks to personal information.

Of particular interest (to me, anyway) was the FTC’s response to comments by the World Privacy Forum to the then-proposed order. In their response to the WPF’s questions and comments, the FTC wrote, in part:

Finally, you ask the Commission to require CVS Caremark to notify consumers whose information was discarded in the dumpster incidents. The Commission considers a variety of factors in deciding whether notice to consumers is an appropriate remedy in a particular case, such as whether consumer victims are reasonably identifiable and whether the notice would be likely to benefit consumers under the circumstances. Here, the Commission has determined that the remedies in the proposed order – including implementing and maintaining a comprehensive information security program and obtaining independent assessments of its effectiveness every other year for 20 years – will ensure appropriate protections for consumers.

Well, no. Consumers whose records were just improperly discarded should have been notified so that they can decide whether they want to continue doing business with CVS. Future security protections do nothing for those whose records were already exposed. Although I have tremendous respect for the FTC, I think they took the easy way out on this one instead of insisting that CVS notify everyone whose records were involved.

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