Read 1st time February 14, 2008 and copies ordered printed.





To amend chapter 407, RSMo, by adding thereto one new section relating to consumer notification of security breaches.

Be it enacted by the General Assembly of the state of Missouri, as follows:

            Section A. Chapter 407, RSMo, is amended by adding thereto one new section, to be known as section 407.2040, to read as follows:

            407.2040. 1. As used in this section, the following terms mean:

            (1) "Breach of the security of the data", unauthorized acquisition of computerized or noncomputerized data that compromises the security, confidentiality, or integrity of personal information maintained by the entity. Good faith acquisition of personal information by an employee or agent of the entity for a legitimate purpose of the entity is not a breach of the security of the data, provided that the personal information is not used for a purpose unrelated to the entity or subject to further unauthorized disclosure. Breach of the security of noncomputerized data includes but is not limited to unauthorized photocopying, facsimiles, or other paper-based transmittal of documents;

            (2) "Credit card", any card, plate, coupon book, or other credit device existing for the purpose of obtaining money, property, labor, or services on credit;

            (3) "Debit card", any card or device issued by a financial institution to a consumer for use in initiating an electronic fund transfer from the account holding assets of the consumer at such financial institution, for the purpose of transferring money between accounts or obtaining money, property, labor, or services;

            (4) "Entity", a sole proprietorship, partnership, corporation, association, or other group, however organized and whether or not organized to operate at a profit, including a financial institution organized, chartered, or holding a license or authorization certificate under the laws of this state, any other state, the United States, or of any other country, or the parent or the subsidiary of a financial institution;

            (5) "Payment device", a card, code, or other means to access or place a charge on a consumer's account or bill;

            (6) "Person", any individual, firm, partnership, association, corporation, limited liability company, organization or other entity, but shall not include the state or any political subdivision of the state, or any agency thereof;

            (7) "Personal information":

            (a) An individual's last name, address, or phone number in combination with any one or more of the following data elements, when either the name or the data elements are not encrypted or redacted, or encrypted with an encryption key that was also acquired:

            a. Social Security number;

            b. Driver's license number or state identification card number;

            c. Account number, credit, debit, or other number identifying a payment device, if circumstances exist in which such a number could be used without additional identifying information, access codes, or passwords;

            d. Account passwords or personal identification numbers (PINs) or other access codes;

            e. Biometric data, other than a photograph;

            f. Any of the items in subparagraphs a. to e. in this paragraph when not in connection with the individual's last name, address, or phone number if the information compromised would be sufficient to perform or attempt to perform identity theft or other illegal conduct against the person whose information was compromised;

            (b) "Personal information" shall not include information that is lawfully obtained from a single public record of federal, state, or local government record, provided that such information has not been aggregated or consolidated into an electronic database or similar system by the entity;

            (8) "Social Security number", any portion of three or more consecutive digits of a Social Security number.

            2. (1) Except as provided in subdivision (2) of this subsection, any person or entity that owns or uses personal information in any form, whether computerized, paper, or otherwise, that includes personal information concerning a Missouri resident shall notify the resident that there has been a breach of the security of the data following discovery or notification of the breach. The disclosure notification shall be made in the most expedient time possible and without unreasonable delay, consistent with the legitimate needs of law enforcement, as provided in subdivision (2) of this subsection, or with any measures necessary to determine the scope of the breach and restore the reasonable integrity, security and confidentiality of the data system.

            (2) The notification required by this subsection may be delayed if a law enforcement agency determines in writing that the notification may materially impede a criminal investigation.

            (3) For purposes of this section, notice to consumers may be provided by one of the following methods:

            (a) Written notice;

            (b) Electronic notice, if the notice provided is consistent with the provisions regarding electronic records and signatures, for notices legally required to be in writing, set forth in Section 7001 of Title 15 of the United States Code;

            (c) Substitute notice, if the agency demonstrates that the cost of providing notice to persons in this state would exceed two hundred fifty thousand dollars or that the affected class of subject persons to be notified in this state exceeds five hundred thousand dollars or the agency does not have sufficient contact information. Substitute notice shall consist of all of the following:

            a. Conspicuous posting of the notice on the Internet site of the agency or person, if the agency or person maintains a public Internet site; and

            b. Notification to major statewide media. The notice to media shall include a toll-free phone number where an individual can learn whether or not that individual's personal data is included in the security breach.

            (4) Such notice shall include:

            (a) To the extent possible, a description of the categories of information that were, or are reasonably believed to have been, accessed or acquired by an unauthorized person, including Social Security numbers, driver's license or state identification numbers and financial data;

            (b) A toll-free number:

            a. That the individual may use to contact the agency or person, or the agent of the agency or person; and

            b. From which the individual may learn:

            (i) What types of information the agency or person maintained about that individual or about individuals in general; and

            (ii) Whether or not the agency or person maintained information about that individual; and

            (iii) The toll-free contact telephone numbers and addresses for the major credit reporting agencies.

            (5) The notification required by this subsection may be delayed if a law enforcement agency determines, in writing, that the notification may seriously impede a criminal investigation. This notification shall state the duration of the delay requested, or shall be renewed after ninety days.

            (6) A person required to provide notification shall provide or arrange for the provision of, to each individual to whom notification is provided under this subsection and on request and at no cost to such individual to either provide at the choice of the consumer credit reports from at least one of the major credit reporting agencies beginning not later than two months following a breach of security and continuing on a quarterly basis for a period of two years thereafter or pay for freeze fees, which include placement with each of the major nationwide credit reporting agencies and temporary lift twice per credit reporting agency during a twelve-month period.

            3. (1) All remedies, penalties, and authority granted to the attorney general shall be available to the attorney general for enforcement of this section.

            (2) The remedies and penalties provided by this section are cumulative to each other and the remedies or penalties available under all other laws of this state.

            4. Any waiver of the provisions of this section is contrary to public policy, and is void and unenforceable.