(iv) the toll-free contact telephone 
numbers and addresses for the major con-
sumer reporting agencies; and 
(v) a toll-free telephone number and 
Internet website address for the Commis-
sion whereby the individual may obtain in-
formation regarding identity theft. 
(2) SUBSTITUTE NOTIFICATION.— 
(A) CIRCUMSTANCES GIVING RISE TO SUB-
STITUTE NOTIFICATION.—A person required to 
provide notification to individuals under sub-
section (a)(1) may provide substitute notifica-
tion in lieu of the direct notification required by 
paragraph (1) if the person owns or possesses 
data in electronic form containing personal in-
formation of fewer than 1,000 individuals and 
such direct notification is not feasible due to— 
(i) excessive cost to the person re-
quired to provide such notification relative 
to the resources of such person, as deter-
mined in accordance with the regulations 
issued by the Commission under paragraph 
(3)(A); or 
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(ii) lack of sufficient contact informa-
tion for the individual required to be noti-
fied. 
(B) FORM
OF
SUBSTITUTE
NOTIFICA-
TION.—Such substitute notification shall in-
clude— 
(i) email notification to the extent 
that the person has email addresses of in-
dividuals to whom it is required to provide 
notification under subsection (a)(1); 
(ii) a conspicuous notice on the Inter-
net website of the person (if such person 
maintains such a website); and 
(iii) notification in print and to broad-
cast media, including major media in met-
ropolitan and rural areas where the indi-
viduals whose personal information was ac-
quired reside. 
(C) CONTENT OF SUBSTITUTE NOTICE.— 
Each form of substitute notice under this para-
graph shall include— 
(i) notice that individuals whose per-
sonal information is included in the breach 
of security are entitled to receive, at no 
cost to the individuals, consumer credit re-
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ports on a quarterly basis for a period of 
2 years, or credit monitoring or other serv-
ice that enables consumers to detect the 
misuse of their personal information for a 
period of 2 years, and instructions on re-
questing such reports or service from the 
person, except when the only information 
which has been the subject of the security 
breach is the individual’s first name or ini-
tial and last name, or address, or phone 
number, in combination with a credit or 
debit card number, and any required secu-
rity code; and 
(ii) a telephone number by which an 
individual can, at no cost to such indi-
vidual, learn whether that individual’s per-
sonal information is included in the breach 
of security. 
(3) REGULATIONS AND GUIDANCE.— 
(A) REGULATIONS.—Not later than 1 year 
after the date of enactment of this Act, the 
Commission shall, by regulation under section 
553 of title 5, United States Code, establish cri-
teria for determining circumstances under 
which substitute notification may be provided 
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emcdonald on DSK67QTVN1PROD with BILLS
under paragraph (2), including criteria for de-
termining if notification under paragraph (1) is 
not feasible due to excessive costs to the person 
required to provide such notification relative to 
the resources of such person. Such regulations 
may also identify other circumstances where 
substitute notification would be appropriate for 
any person, including circumstances under 
which the cost of providing notification exceeds 
the benefits to consumers. 
(B) GUIDANCE.—In addition, the Commis-
sion shall provide and publish general guidance 
with respect to compliance with this subsection. 
Such guidance shall include— 
(i) a description of written or email 
notification that complies with the require-
ments of paragraph (1); and 
(ii) guidance on the content of sub-
stitute notification under paragraph (2), 
including the extent of notification to print 
and broadcast media that complies with 
the requirements of such paragraph. 
(e) OTHER OBLIGATIONS FOLLOWING BREACH.— 
(1) IN GENERAL.—A person required to provide 
notification under subsection (a) shall, upon request 
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emcdonald on DSK67QTVN1PROD with BILLS
of an individual whose personal information was in-
cluded in the breach of security, provide or arrange 
for the provision of, to each such individual and at 
no cost to such individual— 
(A) consumer credit reports from at least 
one of the major consumer reporting agencies 
beginning not later than 60 days following the 
individual’s request and continuing on a quar-
terly basis for a period of 2 years thereafter; or 
(B) a credit monitoring or other service 
that enables consumers to detect the misuse of 
their personal information, beginning not later 
than 60 days following the individual’s request 
and continuing for a period of 2 years. 
(2) LIMITATION.—This subsection shall not 
apply if the only personal information which has 
been the subject of the security breach is the individ-
ual’s first name or initial and last name, or address, 
or phone number, in combination with a credit or 
debit card number, and any required security code. 
(3) RULEMAKING.—As part of the Commis-
sion’s rulemaking described in subsection (d)(3), the 
Commission shall determine the circumstances under 
which a person required to provide notification 
under subsection (a)(1) shall provide or arrange for 
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emcdonald on DSK67QTVN1PROD with BILLS
the provision of free consumer credit reports or cred-
it monitoring or other service to affected individuals. 
(f) EXEMPTION.— 
(1) GENERAL EXEMPTION.—A person shall be 
exempt from the requirements under this section if, 
following a breach of security, such person deter-
mines that there is no reasonable risk of identity 
theft, fraud, or other unlawful conduct. 
(2) PRESUMPTION.— 
(A) IN GENERAL.—If the data in electronic 
form containing personal information is ren-
dered unusable, unreadable, or indecipherable 
through encryption or other security technology 
or methodology (if the method of encryption or 
such other technology or methodology is gen-
erally accepted by experts in the information se-
curity field), there shall be a presumption that 
no reasonable risk of identity theft, fraud, or 
other unlawful conduct exists following a breach 
of security of such data. Any such presumption 
may be rebutted by facts demonstrating that 
the encryption or other security technologies or 
methodologies in a specific case, have been or 
are reasonably likely to be compromised. 
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emcdonald on DSK67QTVN1PROD with BILLS
(B) 
METHODOLOGIES
OR
TECH-
NOLOGIES.—Not later than 1 year after the 
date of the enactment of this Act and bian-
nually thereafter, the Commission shall issue 
rules (pursuant to section 553 of title 5, United 
States Code) or guidance to identify security 
methodologies or technologies which render data 
in electronic form unusable, unreadable, or in-
decipherable, that shall, if applied to such data, 
establish a presumption that no reasonable risk 
of identity theft, fraud, or other unlawful con-
duct exists following a breach of security of 
such data. Any such presumption may be rebut-
ted by facts demonstrating that any such meth-
odology or technology in a specific case has 
been or is reasonably likely to be compromised. 
In issuing such rules or guidance, the Commis-
sion shall consult with relevant industries, con-
sumer organizations, and data security and 
identity theft prevention experts and established 
standards setting bodies. 
(3) FTC GUIDANCE.—Not later than 1 year 
after the date of the enactment of this Act the Com-
mission shall issue guidance regarding the applica-
tion of the exemption in paragraph (1). 
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emcdonald on DSK67QTVN1PROD with BILLS
(g) WEBSITE NOTICE OF FEDERAL TRADE COMMIS-
SION.—If the Commission, upon receiving notification of 
any breach of security that is reported to the Commission 
under subsection (a)(2), finds that notification of such a 
breach of security via the Commission’s Internet website 
would be in the public interest or for the protection of 
consumers, the Commission shall place such a notice in 
a clear and conspicuous location on its Internet website. 
(h) FTC STUDY ON NOTIFICATION IN LANGUAGES 
IN ADDITION TO ENGLISH.—Not later than 1 year after 
the date of enactment of this Act, the Commission shall 
conduct a study on the practicality and cost effectiveness 
of requiring the notification required by subsection (d)(1) 
to be provided in a language in addition to English to indi-
viduals known to speak only such other language. 
(i) GENERAL RULEMAKING AUTHORITY.—The Com-
mission may promulgate regulations necessary under sec-
tion 553 of title 5, United States Code, to effectively en-
force the requirements of this section. 
(j) TREATMENT OF PERSONS GOVERNED BY OTHER 
LAW.—A person who is in compliance with any other Fed-
eral law that requires such person to provide notification 
to individuals following a breach of security, and that, 
taken as a whole, provides protections substantially similar 
to, or greater than, those required under this section, as 
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the Commission shall determine by rule (under section 
553 of title 5, United States Code), shall be deemed to 
be in compliance with this section. 
SEC. 4. APPLICATION AND ENFORCEMENT. 
(a) GENERAL APPLICATION.—The requirements of 
sections 2 and 3 shall only apply to those persons, partner-
ships, or corporations over which the Commission has au-
thority pursuant to section 5(a)(2) of the Federal Trade 
Commission Act (15 U.S.C. 45(a)(2)). 
(b) ENFORCEMENT BY THE FEDERAL TRADE COM-
MISSION.— 
(1) UNFAIR
OR
DECEPTIVE
ACTS
OR
PRAC-
TICES.—A violation of section 2 or 3 shall be treated 
as an unfair and deceptive act or practice in viola-
tion of a regulation under section 18(a)(1)(B) of the 
Federal 
Trade 
Commission 
Act 
(15 
U.S.C. 
57a(a)(1)(B)) regarding unfair or deceptive acts or 
practices. 
(2) POWERS
OF
COMMISSION.—The Commis-
sion shall enforce this Act in the same manner, by 
the same means, and with the same jurisdiction, 
powers, and duties as though all applicable terms 
and provisions of the Federal Trade Commission Act 
(15 U.S.C. 41 et seq.) were incorporated into and 
made a part of this Act. Any person who violates 
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emcdonald on DSK67QTVN1PROD with BILLS
such regulations shall be subject to the penalties and 
entitled to the privileges and immunities provided in 
that Act. 
(3) LIMITATION.—In promulgating rules under 
this Act, the Commission shall not require the de-
ployment or use of any specific products or tech-
nologies, including any specific computer software or 
hardware. 
(c) ENFORCEMENT
BY STATE ATTORNEYS GEN-
ERAL.— 
(1) CIVIL ACTION.—In any case in which the 
attorney general of a State, or an official or agency 
of a State, has reason to believe that an interest of 
the residents of that State has been or is threatened 
or adversely affected by any person who violates sec-
tion 2 or 3 of this Act, the attorney general, official, 
or agency of the State, as parens patriae, may bring 
a civil action on behalf of the residents of the State 
in a district court of the United States of appro-
priate jurisdiction— 
(A) to enjoin further violation of such sec-
tion by the defendant; 
(B) to compel compliance with such sec-
tion; or 
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emcdonald on DSK67QTVN1PROD with BILLS
(C) to obtain civil penalties in the amount 
determined under paragraph (2). 
(2) CIVIL PENALTIES.— 
(A) CALCULATION.— 
(i) TREATMENT
OF
VIOLATIONS
OF 
SECTION
2.—For purposes of paragraph 
(1)(C) with regard to a violation of section 
2, the amount determined under this para-
graph is the amount calculated by multi-
plying the number of days that a person is 
not in compliance with such section by an 
amount not greater than $11,000. 
(ii) TREATMENT
OF
VIOLATIONS
OF 
SECTION
3.—For purposes of paragraph 
(1)(C) with regard to a violation of section 
3, the amount determined under this para-
graph is the amount calculated by multi-
plying the number of violations of such 
section by an amount not greater than 
$11,000. Each failure to send notification 
as required under section 3 to a resident of 
the State shall be treated as a separate 
violation. 
(B) ADJUSTMENT
FOR
INFLATION.—Be-
ginning on the date that the Consumer Price 
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