Stephen Adams, the former New England small-business advocate for the U.S. Small Business Administration, wrote an op-ed piece in today’s Boston Business Journal discussing our amended Data Security regulations. Give it a read:
A dramatic new economic development effort was launched last week by the Patrick administration but received scant attention. The new initiative will save Massachusetts small businesses hundreds of millions of dollars each year. Yet it was accomplished without ceding a dime of tax revenue, expending a dollar of government subsidy or compromising one inch on consumer or employee protections.
The author of this economic boon is neither an economist or economic development professional. Rather, she is a lawyer and consumer advocate — Undersecretary for Consumer Affairs and Business Regulation Barbara Anthony. She produced this major economic stimulus by rewriting state data privacy rules so that small businesses could comply without taking on unnecessary costs.
It is true that these gains come from scaling back costly new regulations imposed by the Patrick administration in the first place. But this case demonstrates that state government can produce strong economic benefits simply by being attentive to the way its rules and regulations hit small businesses and by being thoughtful in their design.
Late last year the Office of Consumer Affairs and Business Regulation, in response to a legislative mandate to protect consumer and employee data, adopted the most demanding data security regulations in the nation.
Moreover, the onerous requirements would be applied equally to all businesses. That meant that the smallest mom-and-pop would be required to adopt the same data security measures as the largest financial services firms.
OCABR staff had estimated that the new rules would cost a 10-person firm $3,000 in upfront costs and another $6,000 every year. This is a dramatic underestimate, according to some data security experts, who placed the upfront small-business costs at nearly $40,000.
Enter Barbara Anthony. Anthony and her team rewrote the rules to take into consideration the size of a business and the amount of personal information it handles. The revisions require “safeguards that are appropriate to the size, scope and type of business handling the information; the amount of resources available to the business; the amount of stored data; and the need for security and confidentiality of both consumer and employee information.” By designing the requirements around a company’s ability to comply, the revised rules will sharply reduce the cost to small firms and increase compliance.
The news is not all good. The revised regulations will still add a new layer of state costs and requirements to existing Federal data security rules. Nonetheless, if Anthony’s accomplishment can be repeated across the rest of state government, the economic benefit to the commonwealth will be enormous.
Stephen Adams was the New England small-business advocate for the U.S. Small Business Administration from 2005 to 2009.
Immigration Scams posted on Mar 27
The call to strengthen the United States’ borders has opened a new window of opportunity for con artists who are capitalizing on fear and uncertainty. The Boston Globe reported earlier this month that there has been an uptick in scammers posing as federal agents, …Continue Reading Immigration Scams
Car Buyer Beware: ”Buy Here Pay Here” Used Car Financing and Sales are Riddled with Pitfalls posted on Mar 23
Many consumers need a loan to purchase a used vehicle. Consumers with poor or no credit will often seek financing from the dealer they are buying a car from. This financing is commonly referred to as “Buy Here Pay Here,” and it lets dealers …Continue Reading Car Buyer Beware: ”Buy Here Pay Here” Used Car Financing and Sales are Riddled with Pitfalls
Apps – Access Denied posted on Mar 21
Almost everyone is guilty of passively downloading a new app for their mobile device. And why not? Apps are great. But consumers should recognize that there are risks in the marketplace. A woman from California used her debit card to buy a slot machine …Continue Reading Apps – Access Denied