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The NCUA is looking for ways to protect credit union member information after an examiner lost a flash drive with members’ personal information last month. The data breach compromised the names, addresses, Social Security numbers and account numbers of the $13 million Palm Springs Federal Credit Union—a breach estimated to cost up to $20,000.
Earlier this week, the NCUA was considering a rule that would require credit unions to encrypt data given to examiners. But NAFCU says the NCUA should look to fix the problem internally instead of imposing a new rule, according to Director of Regulatory Affairs Alicia Nealon.
“Credit unions must already follow stringent data security and privacy requirements, and they have a strong track record of regulatory compliance with these requirements. Credit unions also constantly strive to implement the highest safeguards for their members data,” Nealon said.
A recent NAFCU member survey found that credit unions voluntarily follow many of NCUA’s recommendations to safeguard member data in addition to meeting regulatory requirements.
“Short of requiring [encryption], we’re really struggling trying to figure out how to prevent data breaches. That’s a very fundamental thing to do, to make sure that if the data is lost or stolen that members’ confidential information is protected,” NCUA Board Chairman Dabbie Matz said in a CU Times article. “Of course we’re always willing to hear suggestions from the credit union community about how to proceed.”
The Palm Springs data loss is the first of its kind after more than 28,000 examinations over the last six years, said NCUA Board Vice Chairman Rick Metsger.
“There is a human element obviously in anything and when you do tens of thousands of exams, you can anticipate that sometimes someone is going to make a human error,” Metsger said in a CU Times article. “We try to be perfect, obviously. Our rules and procedures are very clear. When they are not followed, you can have an issue so we take it very seriously.”
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