'Name-and-shame' disclosure could backfire

It could do more harm than good, Australian commissioner says

Australian federal privacy commissioner Karen Curtis is warning that calls for Australian companies to be subject to a compulsory name-and-shame data breach regime could backfire and create a compliance nightmare.

The statement is the strongest indication yet that a looming shake-up of the private sector provisions of the Privacy Act in Australia will not take the lead of US regulators, which have compelled corporations and government agencies to publish details of even minor infractions against customer data protection laws.

The warning comes as New Zealand organisations get to grips with our own Privacy Commissioner’s draft data breach disclosure guidelines, unveiled last week. Privacy Commissioner Marie Shroff has indicated she will consider whether breach guidelines should become a mandatory.

Curtis says serious consideration is being given to publicly identifying companies or agencies involved in incidents when there was a tangible risk of harm to consumers.

This is backed by research undertaken by her office over the past nine years that shows consumers favour pragmatism and common sense over onerous bureaucracy.

“The guts of it is that mandatory reporting for breaches should be examined, but you have to find the right threshold,” Curtis says. “We think there is merit, but not in all circumstances. Direct comparisons [with the US] are not ideal.”

Forty US states have passed strict laws that force corporations to disclose any incidents that involve the loss or exposure of customer information.

While the US laws have created a multibillion-dollar bonanza for the security and compliance management industries, their benefit has also been questioned because they do little to regulate the methods that companies use to collect, sort and sell on information about customers.

Curtis says the ALRC review, which will make formal recommendations to Attorney-General Philip Ruddock next year, was needed because there was a mishmash of private, public, federal, state and local privacy regimes that sometimes acted to confuse people as to where they could go to seek advice and justice.

In New Zealand, Shroff is studying overseas developments in data breach disclosure carefully before making recommendations for local policy. She appears especially attracted to developments in Canada, but Australian policy is also being watched.

The Australian Privacy Commissioner has recommended that a single set of privacy principles that applies to both the public and private sector needs to be created, to streamline how people apply privacy laws and seek redress. The authority has also started to take a more active interest in the behaviour of the private security industry, which is regulated by state police forces.

Curtis confirms her office is looking at a number of complaints about the alleged circulation of the personal details of pub patrons, who had been forced to provide identification that is electronically scanned and retained.

Many licensed pubs and clubs now claim they are required to collect such information under liquor licensing laws. Curtis says she wants to know where the information collected from scans of drivers’ licences or other documents is going and how it is being used.

Australia’s Office of the Privacy Commissioner was expected to release new guidelines for pubs last week and will warn establishments that have an annual turnover of more than A$3 million that they are subject to federal privacy protection laws.

The pub ID problem has become a serious issue in Queensland. The state’s licensing authority, Queensland Transport, has started to remove addresses from drivers’ licences because they were being used by pub bouncers to find out where female patrons live.

Curtis says she intends to use Privacy Awareness Week, which started in Australia as in New Zealand last weekend, to emphasise the benefits that good privacy protections bring the community at large.

Australian Financial Review. Additional reporting by Rob O’Neill

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