How states can address evolving privacy laws
ARTICLE | November 15, 2023
Authored by RSM US LLP
As of November, 12 states have passed comprehensive privacy laws to protect the use of personal information. All 12 laws target the conduct of commercial entities that operate within the state or collect or sell a certain number of records pertaining to that state’s residents. The new laws highlight privacy best practices such as adequate notice, opt-out rights, and a consumer’s right to access or delete data.
The trend toward codifying privacy rights and improving consumers’ control of their data started with the passage of the European Union’s General Data Protection Regulation in 2018. While the recently passed U.S. state laws focus primarily on commercial entities, government entities should also take measures to maintain public confidence and trust, and to mitigate risks to the state.
Though this article focuses on state governments, cities, and counties face the same privacy obligations and the same challenges in ensuring compliance.
States should conduct a thorough evaluation of their vendors and partners and have adequate data-sharing contract language, as using third-party services does not relieve the original state entity from the growing array of compliance and privacy obligations.
Why states should care about privacy
By providing public services and programs, states gather a substantial amount of constituent data. Some data collection is compulsory (such as criminal justice records, birth certificates, and death certificates), while other data is provided to state entities by residents to receive benefits such as tax credits, rebates, and public assistance. A single state, in providing services to its residents, can collect a variety of data, including personally identifiable information, credit card information, protected health care information, federal education records, and tax information.
Units of state governments also share data with other agencies or trusted partners and vendors. Within a state, an entity might share data for the purpose of research, public health or safety, trend analytics, program use metrics, verification, and advertising. States gathering and sharing data increase their attack surface by disseminating data to other agencies and partners—and sometimes, by collecting and retaining more information than necessary.
States should conduct a thorough evaluation of their vendors and partners and have adequate data-sharing contract language, as using third-party services does not relieve the original state entity from the growing array of compliance and privacy obligations. To maintain the trust and confidence of their residents, states must monitor third-party data collection and sharing, and maintain the confidentiality of sensitive information.
Steps to mitigate privacy risks faced by states and the public
A state’s excessive collection of information, inability to provide records to its constituents, or failure to maintain the confidentiality of sensitive data can erode public trust and cause considerable reputational harm. Constituents can also face more tangible harm such as identity theft, electronic benefits transfer fraud, or unemployment scams.
However, a state can incorporate new—or improve existing—privacy practices to promote transparency and public trust. Examples include:
We understand the complexity of the information that states encounter in providing services for the public and can design, build, and maintain a customized privacy program that addresses your privacy and compliance requirements.
Call us at (325) 677-6251 or fill out the form below and we'll contact you to discuss your specific situation.
This article was written by RSM US LLP and originally appeared on 2023-11-15.
2022 RSM US LLP. All rights reserved.
RSM US Alliance provides its members with access to resources of RSM US LLP. RSM US Alliance member firms are separate and independent businesses and legal entities that are responsible for their own acts and omissions, and each is separate and independent from RSM US LLP. RSM US LLP is the U.S. member firm of RSM International, a global network of independent audit, tax, and consulting firms. Members of RSM US Alliance have access to RSM International resources through RSM US LLP but are not member firms of RSM International. Visit rsmus.com/about us for more information regarding RSM US LLP and RSM International. The RSM logo is used under license by RSM US LLP. RSM US Alliance products and services are proprietary to RSM US LLP.
Condley and Company, LLP is a proud member of the RSM US Alliance, a premier affiliation of independent accounting and consulting firms in the United States. RSM US Alliance provides our firm with access to resources of RSM US LLP, the leading provider of audit, tax and consulting services focused on the middle market. RSM US LLP is a licensed CPA firm and the U.S. member of RSM International, a global network of independent audit, tax and consulting firms with more than 43,000 people in over 120 countries.
Our membership in RSM US Alliance has elevated our capabilities in the marketplace, helping to differentiate our firm from the competition while allowing us to maintain our independence and entrepreneurial culture. We have access to a valuable peer network of like-sized firms as well as a broad range of tools, expertise and technical resources.
For more information on how Condley and Company can assist you, please call (325) 677-6251.