[Federal Register Volume 84, Number 224 (Wednesday, November 20, 2019)]
[Notices]
[Pages 64074-64076]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-25109]
-----------------------------------------------------------------------
FEDERAL TRADE COMMISSION
[File No. 162 3130]
InfoTrax Systems, L.C. and Mark Rawlins; Analysis To Aid Public
Comment
AGENCY: Federal Trade Commission.
ACTION: Proposed consent agreement; Request for comment.
-----------------------------------------------------------------------
SUMMARY: The consent agreement in this matter settles alleged
violations of federal law prohibiting unfair or deceptive acts or
practices. The attached Analysis to Aid Public Comment describes both
the allegations in the complaint and the terms of the consent order--
embodied in the consent agreement--that would settle these allegations.
DATES: Comments must be received on or before December 20, 2019.
ADDRESSES: Interested parties may file comments online or on paper, by
following the instructions in the Request for Comment part of the
SUPPLEMENTARY INFORMATION section below. Write: ``InfoTrax Systems,
L.C. and Mark Rawlins; File No. 162 3130'' on your comment, and file
your comment online at https://www.regulations.gov by following the
instructions on the web-based form. If you prefer to file your comment
on paper, mail your comment to the following address: Federal Trade
Commission, Office of the Secretary, 600 Pennsylvania Avenue NW, Suite
CC-5610 (Annex D), Washington, DC 20580, or deliver your comment to the
following address: Federal Trade Commission, Office of the Secretary,
Constitution Center, 400 7th Street SW, 5th Floor, Suite 5610 (Annex
D), Washington, DC 20024.
FOR FURTHER INFORMATION CONTACT: Andrea Arias (202-326-2715), Bureau of
Consumer Protection, Federal Trade Commission, 600 Pennsylvania Avenue
NW, Washington, DC 20580.
SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal
Trade Commission Act, 15 U.S.C. 46(f), and FTC Rule 2.34, 16 CFR 2.34,
notice is hereby given that the above-captioned consent agreement
containing a consent order to cease and desist, having been filed with
and accepted, subject to final approval, by the Commission, has been
placed on the public record for a period of thirty (30) days. The
following Analysis to Aid Public Comment describes the terms of the
consent agreement and the allegations in the complaint. An electronic
copy of the full text of the consent agreement package can be obtained
from the FTC Home Page (for November 12, 2019), on the World Wide Web,
at https://www.ftc.gov/news-events/commission-actions.
You can file a comment online or on paper. For the Commission to
consider your comment, we must receive it on or before December 20,
2019. Write ``InfoTrax Systems, L.C. and Mark Rawlins; File No. 162
3130'' on your comment. Your comment--including your name and your
state--will be placed on the public record of this proceeding,
including, to the extent practicable, on the https://www.regulations.gov website.
Postal mail addressed to the Commission is subject to delay due to
heightened security screening. As a result, we encourage you to submit
your comments online through the https://www.regulations.gov website.
If you prefer to file your comment on paper, write ``InfoTrax
Systems, L.C. and Mark Rawlins; File No. 162 3130'' on your comment and
on the envelope, and mail your comment to the following address:
Federal Trade Commission, Office of the Secretary, 600 Pennsylvania
Avenue NW, Suite CC-5610 (Annex D), Washington, DC 20580; or deliver
your comment to the following address: Federal Trade Commission, Office
of the Secretary, Constitution Center, 400 7th Street SW, 5th Floor,
Suite 5610 (Annex D), Washington, DC 20024. If possible, submit your
paper comment to the Commission by courier or overnight service.
Because your comment will be placed on the publicly accessible
website at https://www.regulations.gov, you are solely responsible for
making sure that your comment does not include any sensitive or
confidential information. In particular, your comment should not
include any sensitive personal information, such as your or anyone
else's Social Security number; date of birth; driver's license number
or other state identification number, or foreign country equivalent;
passport number; financial account number; or credit or debit card
number. You are also solely responsible for making sure that your
comment does not include any sensitive health information, such as
medical records or other individually identifiable health information.
In addition, your comment should not include any ``trade secret or any
commercial or financial information which . . . is privileged or
confidential''--as provided by Section 6(f) of the FTC Act, 15 U.S.C.
46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2)--including in
particular competitively sensitive information such as costs, sales
statistics, inventories, formulas, patterns, devices, manufacturing
processes, or customer names.
Comments containing material for which confidential treatment is
requested must be filed in paper form, must be clearly labeled
``Confidential,'' and must comply with FTC Rule 4.9(c). In particular,
the written request for confidential treatment that accompanies the
comment must include the factual and legal basis for the request, and
must identify the specific portions of the comment to be withheld from
the public record. See FTC Rule 4.9(c). Your comment will be kept
confidential only if the General Counsel grants your request in
accordance with the law and the public interest. Once your comment has
been posted on the public FTC website--as legally required by FTC Rule
4.9(b)--we cannot redact or remove your comment from the FTC website,
unless you submit a confidentiality request that meets the requirements
for such treatment under FTC Rule 4.9(c), and the General Counsel
grants that request.
Visit the FTC website at http://www.ftc.gov to read this Notice and
the
[[Page 64075]]
news release describing it. The FTC Act and other laws that the
Commission administers permit the collection of public comments to
consider and use in this proceeding, as appropriate. The Commission
will consider all timely and responsive public comments that it
receives on or before December 20, 2019. For information on the
Commission's privacy policy, including routine uses permitted by the
Privacy Act, see https://www.ftc.gov/site-information/privacy-policy.
Analysis of Proposed Consent Order To Aid Public Comment
The Federal Trade Commission (``Commission'') has accepted, subject
to final approval, an agreement containing a consent order from
InfoTrax Systems, L.C. (``InfoTrax'') and Mark Rawlins (collectively
``Respondents'').
The proposed consent order (``proposed order'') has been placed on
the public record for thirty (30) days for receipt of comments from
interested persons. Comments received during this period will become
part of the public record. After thirty (30) days, the Commission will
again review the agreement and the comments received, and will decide
whether it should withdraw from the agreement and take appropriate
action or make final the agreement's proposed order.
This matter involves InfoTrax, a technology company that provides
backend operations systems and online distributor tools for the direct
sales industry. Respondents have stored personal information about more
than eleven million consumers.
The Commission's proposed complaint alleges that Respondents
violated Section 5(a) of the Federal Trade Commission Act (``FTC
Act''). The proposed complaint alleges that Respondents engaged in a
number of unreasonable security practices and that, as a result of
these practices, an intruder, or intruders, were able to gain
unauthorized access to consumers' personal information in March 2016.
During multiple breaches, intruder(s) accessed and/or downloaded the
personal information of over one million consumers. The types of
information exposed included full names; physical addresses; email
addresses; telephone numbers; Social Security Numbers (``SSNs'') or
other government identification numbers; clients' distributors' user
IDs and passwords; admin IDs and passwords; payment card information
including credit or debit card numbers, Card Verification Values
(``CVVs'') and expiration dates; and bank account information including
bank account and routing numbers. (However, a particular individual's
record does not necessarily contain every one of these data types.)
The proposed complaint alleges that Respondents:
Failed to have a systematic process for inventorying and
deleting consumers' personal information stored on InfoTrax's network
that is no longer necessary;
Failed to adequately assess the cybersecurity risk posed
to consumers' personal information stored on InfoTrax's network by
performing adequate code review of InfoTrax's software, and penetration
testing of InfoTrax's network and software;
Failed to detect malicious file uploads by implementing
protections such as adequate input validation;
Failed to adequately limit the locations to which third
parties could upload unknown files on InfoTrax's network;
Failed to adequately segment InfoTrax's network to ensure
that one client's distributors could not access another client's data
on the network;
Failed to implement safeguards to detect anomalous
activity and/or cybersecurity events. For example, Respondents failed
to: (1) Implement an intrusion prevention or detection system to alert
Respondents of potentially unauthorized queries and/or access to
InfoTrax's network; (2) use file integrity monitoring tools to
determine whether any files on InfoTrax's network had been altered; and
(3) use data loss prevention tools to regularly monitor for
unauthorized attempts to exfiltrate consumers' personal information
outside InfoTrax's network boundaries; and
Stored consumers' personal information, including
consumers' SSNs, payment card information (including full or partial
credit card and debit card numbers, CVVs, and expiration dates), bank
account information (including account and routing numbers), and
authentication credentials such as user IDs and passwords, in clear,
readable text on InfoTrax's network.
The proposed complaint alleges that Respondents could have
addressed each of the failures described above by implementing readily
available and relatively low-cost security measures.
The proposed complaint alleges that Respondents' failure to employ
reasonable data security practices to protect personal information--
including names, addresses, SSNs, other government identifiers, and
financial account information--caused or is likely to cause substantial
injury to consumers that is not outweighed by countervailing benefits
to consumers or competition and is not reasonably avoidable by
consumers themselves. Respondents' failure to employ reasonable data
security practices constitutes an unfair act or practice under Section
5 of the FTC Act.
The proposed order contains injunctive provisions addressing the
alleged unfair conduct. Part I of the proposed order prohibits each
Covered Business from transferring, selling, sharing, collecting,
maintaining, or storing personal information unless each Covered
Business establishes and implements, and thereafter maintains, a
comprehensive information security program that protects the security,
confidentiality, and integrity of such personal information.\1\
---------------------------------------------------------------------------
\1\ ``Covered Business'' includes InfoTrax; any business that
InfoTrax controls, directly or indirectly; and any business that Mr.
Rawlins controls, directly or indirectly, except for the businesses
that own, lease, and/or operate a campground in Bunkerville, Nevada,
and solely to the extent that the businesses are engaged in the
operation of that campground.
---------------------------------------------------------------------------
Part II of the proposed order requires Respondents to obtain
initial and biennial data security assessments for twenty (20) years.
Part III of the proposed order requires Respondents to disclose all
material facts to the assessor; prohibits Respondents from
misrepresenting any fact material to the assessments required by Part
II; and requires Respondents to provide or otherwise make available to
the assessor all information and material that is relevant to the
assessment for which there is no reasonable claim of privilege.
Part IV requires Respondents to submit an annual certification from
a senior corporate manager (or senior officer of each Covered Business
responsible for each Covered Business's information security program)
that: (1) Each Covered Business has implemented the requirements of the
Order; (2) each Covered Business is not aware of any material
noncompliance that has not been corrected or disclosed to the
Commission; and (3) includes a brief description of any covered
incident involving unauthorized access to or acquisition of personal
information.
Part V requires Respondents to submit a report to the Commission of
the discovery of any covered incident.
Parts VI through IX of the proposed order are reporting and
compliance provisions, which include recordkeeping requirements and
provisions requiring Respondents to provide information or documents
necessary for the Commission to
[[Page 64076]]
monitor compliance. Part X states that the proposed order will remain
in effect for twenty (20) years, with certain exceptions.
The purpose of this analysis is to aid public comment on the
proposed order. It is not intended to constitute an official
interpretation of the complaint or proposed order, or to modify in any
way the proposed order's terms.
By direction of the Commission.
Joel Christie,
Acting Secretary.
[FR Doc. 2019-25109 Filed 11-19-19; 8:45 am]
BILLING CODE 6750-01-P