The United States is taking bold steps to protect its citizens’ sensitive data from exploitation by foreign adversaries, especially in light of the upcoming presidential elections. The U.S. Department of Justice recently introduced a new rule that targets foreign threats that have been using sensitive data to fuel disinformation campaigns and cyberattacks.
This rule, proposed in response to President Biden’s Executive Order 14117, aims to curb the exploitation of U.S. data by countries identified as threats, such as China, Russia, and others. These countries have increasingly accessed sensitive data through commercial transactions, posing risks to national security through espionage, blackmail, and cyberattacks.
The proposed rule introduces strict regulations on data transactions that may provide foreign adversaries access to bulk sensitive data, including biometric, genomic, and geolocation information. It defines specific categories of sensitive personal data that could be exploited if linked to identifiable U.S. individuals, triggering regulatory scrutiny for transactions involving certain threshold quantities of data.
The rule designates countries such as China, Cuba, Iran, North Korea, Russia, and Venezuela as countries of concern due to their documented threats to U.S. national security. It also regulates data associated with U.S. government personnel to prevent misuse in intelligence operations.
To enforce compliance, the rule outlines restrictions on vendor agreements, employment agreements, and certain investment agreements, which can only proceed if stringent security measures are in place. This includes encryption, data minimization, and organizational policies to mitigate risks associated with data access by foreign entities.
To ensure adherence, affected U.S. entities are required to develop risk-based compliance programs tailored to their operational scale and geographic exposure. These compliance programs must include audits, data-flow logging, and secure data handling practices. Non-compliance carries hefty penalties, including fines up to $1 million and imprisonment for willful violations.
The Justice Department has invited public comments on the proposed rule within 30 days of its publication in the Federal Register. This follows a consultation process with over 100 stakeholders to shape the rule’s development. While the rule does not introduce new surveillance capabilities, it raises the bar for safeguarding sensitive data from misuse by foreign powers.
As regulatory frameworks evolve, companies handling high volumes of sensitive data must quickly adapt to meet these emerging security expectations. The proposed rule marks a significant step towards protecting Americans’ sensitive data from exploitation and ensuring national security in an increasingly digital world.