Nevada mandates e-data encryption.

• Position: DATA SECURITY - Brief article

The state of Nevada is the first in the United States to pass a law requiring that businesses encrypt all personal customer information sent electronically.

The law, which took effect October 1, 2008, defines personal information as first name or initial plus last name combined with either a Social Security, driver's license, ID card, credit/debit card or account number, along with any security code or password that would enable access to a person's financial data.

Nevada's NRS 597.970 states: "A business in this State shall not transfer any personal information of a customer through an electronic transmission other than a facsimile to a person outside of the secure system of the business unless the business uses encryption to ensure the security of electronic transmission."

For businesses that suffer a security breach but comply with the new law, damages won't top $1,000 per customer for each occurrence. Those that don't comply, however, are subject to unlimited civil penalties under the...