Consumer Protection – Security Questions and Measures
Impact
The bill's enactment means that businesses and government entities will need to revise their account security procedures to comply with the new law. Importantly, violations of this law would be considered unfair, deceptive, or abusive trade practices under the Maryland Consumer Protection Act, subjecting violators to enforcement actions and penalties. This change signifies a shift in the legal landscape concerning customer data protection, reinforcing the responsibility of companies to ensure the security of sensitive information they handle. Additionally, it empowers consumers to report any violations they might encounter regarding state or local government units, expanding avenues for accountability.
Summary
Senate Bill 639, titled 'Consumer Protection – Security Questions and Measures', is legislation aimed at enhancing consumer protection in Maryland. Specifically, the bill prohibits businesses and state or local government units from using a customer's mother's maiden name as a security question for account access. This measure is intended to prevent potential identity theft and safeguard customer information by eliminating a common vulnerability used in account verification processes. The legislation places the protection of consumer data at the forefront of financial interactions, reflecting a growing trend towards more stringent security measures in the digital age.
Contention
While there is broad support for enhanced consumer protections, some may argue about the practicality of implementing new security measures without adequate support for businesses, particularly smaller entities that might face challenges in adapting their systems. However, the bill seeks to balance the need for consumer safety with the operational capabilities of businesses, as it does not retroactively affect accounts created before January 1, 2023. This transitional approach may mitigate immediate burdens on businesses while still pushing forward the necessary updates to consumer protection practices.