VA issues final rule on handling lost personal data

The Veterans Affairs Department adopted a final rule on April 11 that details steps the department must take in case it loses sensitive personal information. Those actions include promptly notifying veterans affected by the loss and providing credit protection.

Comment on this article in The Forum.VA developed the rule in June 2007 in the aftermath of the theft of a laptop containing the records of more than 26 million veterans in May 2006.

Existing regulations require VA to conduct a risk analysis before notifying individuals whose records could have been compromised. But the new rule allows the VA secretary to notify the public immediately by mail if the loss is determined to pose "substantial risk of identity theft of the individuals whose data was the subject of the data breach."

The secretary also can offer veterans affected by the breach credit protection services without conducting a risk analysis. VA offered credit protection services in the wake of the 2006 laptop theft.

The final rule requires VA to conduct an independent risk analysis as soon as possible after a data breach occurs to determine risk for potential misuse of sensitive personal information. This analysis could include the use of data-mining techniques, according to rule.

The rule also allows VA to offer one or more types of credit protection services depending on the severity of the loss. These include one year of credit monitoring consisting of automatic daily checks of at least three relevant credit bureau reports; fraud resolution services, including writing dispute letters; initiation of fraud alerts and credit freezes; and free identity theft insurance coverage of $20,000.

The rule also applies to contractors that handle personal data from VA. Contractors must use a computer hard drive or server that is partitioned and segregated to ensure data protection.

At the annual Federal Networks Conference, sponsored by Telestrategies and Suss Consulting in February, Robert Howard, VA assistant secretary for information and technology said the department has adopted a "gold standard" for computer security, which includes encrypted hard drives as well as removable thumb drives and a policy of "vigilance and awareness." VA has requested a cybersecurity budget of $92.5 million for fiscal 2009, up $11.4 million from fiscal 2008.