IAPP Updated CIPP-US Exam Questions and Answers by alisha

The Health Insurance Portability and Accountability Act (HIPAA) of 1996 is a federal law that regulates the privacy and security of health information in the United States. HIPAA preempts state laws that are contrary to its provisions, unless the state laws provide more stringent protections for health information12 HIPAA establishes a floor of federal standards for health information privacy and security, but allows states to enact laws that are more protective of individuals’ rights34 For example, some states may require more specific consent from individuals before disclosing their health information, or impose stricter penalties for violations of health information privacy and security. HIPAA also provides exceptions for certain state laws that serve a compelling public interest, such as public health, safety, or welfare.References: https://www.findlaw.com/litigation/legal-system/the-supremacy-clause-and-the-doctrine-of-preemption.html

https://www.bonalaw.com/insights/legal-resources/when-does-federal-law-preempt-state-law

The Telemarketing Sales Rule (TSR) is a federal regulation that implements the Telemarketing and Consumer Fraud and Abuse Prevention Act of 1994. The TSR aims to protect consumers from deceptive or abusive telemarketing practices, such as unwanted calls, false or misleading claims, unauthorized billing, and privacy violations1.

The TSR requires telemarketers and sellers to comply with the National Do Not Call Registry, which is a list of phone numbers of consumers who have indicated that they do not want to receive telemarketing calls2.

The TSR also requires telemarketers and sellers to honor the do-not-call requests of individual consumers, regardless of whether their numbers are on the National Do Not Call Registry or not2.

A do-not-call request is a statement made by a consumer, either orally or in writing, that they do not wish to receive any more calls from a specific telemarketer or seller2.

The TSR requires an entity to share a do-not-call request across its organization when the operational structures of its divisions are not transparent to consumers3. This means that the entity must treat the do-not-call request as if it applies to all of its affiliates and subsidiaries that engage in telemarketing, unless the consumer would reasonably expect them to be separate and distinct entities based on their names, products, or services3.

The TSR does not require an entity to share a do-not-call request across its organization in the following situations:

When the goods and services sold by its divisions are very similar. This is not a relevant factor for determining whether the entity must share a do-not-call request across its organization. The key factor is whether the consumers can distinguish between the different divisions based on their operational structures3.

When a call is not the result of an error or other unforeseen cause. This is not an exception to the requirement to honor a do-not-call request. The TSR prohibits telemarketers and sellers from calling a consumer who has made a do-not-call request, unless the call falls under one of the specific exemptions, such as calls from or on behalf of tax-exempt nonprofit organizations, calls to consumers with whom the seller has an established business relationship, or calls to consumers who have given prior express written consent2.

When the entity manages user preferences through multiple platforms. This is not an excuse for not sharing a do-not-call request across its organization. The TSR requires telemarketers and sellers to maintain an internal do-not-call list of consumers who have asked them not to call again, and to update the list at least once every 31 days2. The entity must ensure that the do-not-call request is recorded and communicated across all of its platforms that are used for telemarketing purposes3.

References: 1: Telemarketing Sales Rule 2: Q&A for Telemarketers & Sellers About DNC Provisions in TSR 3: Federal Register :: Telemarketing Sales Rule

 The Driver’s Privacy Protection Act (DPPA) is a federal law that regulates the disclosure of personal information obtained by state departments of motor vehicles (DMVs). The DPPA prohibits DMVs and other entities that receive such information from DMVs from disclosing it to anyone without the express consent of the individual to whom the information pertains, unless the disclosure falls under one of the 14 exceptions listed in the statute.

Some of the exceptions that allow disclosure of personal information from DMV records without consent are:

For use by any government agency, including any court or law enforcement agency, in carrying out its functions, or any private person or entity acting on behalf of a government agency in carrying out its functions.

For use in connection with matters of motor vehicle or driver safety and theft; motor vehicle emissions; motor vehicle product alterations, recalls, or advisories; performance monitoring of motor vehicles, motor vehicle parts and dealers; motor vehicle market research activities, including survey research; and removal of non-owner records from the original owner records of motor vehicle manufacturers.

For use in the normal course of business by a legitimate business or its agents, employees, or contractors, but only to verify the accuracy of personal information submitted by the individual to the business or its agents, employees, or contractors; and if such information as so submitted is not correct or is no longer correct, to obtain the correct information, but only for the purposes of preventing fraud by, pursuing legal remedies against, or recovering on a debt or security interest against, the individual.

For use in connection with any civil, criminal, administrative, or arbitral proceeding in any federal, state, or local court or agency or before any self-regulatory body, including the service of process, investigation in anticipation of litigation, and the execution or enforcement of judgments and orders, or pursuant to an order of a federal, state, or local court.

For use in research activities, and for use in producing statistical reports, so long as the personal information is not published, redisclosed, or used to contact individuals.

For use by any insurer or insurance support organization, or by a self-insured entity, or its agents, employees, or contractors, in connection with claims investigation activities, antifraud activities, rating or underwriting.

For use in providing notice to the owners of towed or impounded vehicles.

For use by any licensed private investigative agency or licensed security service for any purpose permitted under this subsection.

For use by an employer or its agent or insurer to obtain or verify information relating to a holder of a commercial driver’s license that is required under chapter 313 of title 49.

For use in connection with the operation of private toll transportation facilities.

For any other use specifically authorized under the law of the state that holds the record, if such use is related to the operation of a motor vehicle or public safety.

None of the exceptions above apply to the use of personal information from DMV records by marketers wishing to distribute bulk materials. Therefore, such use would require the consent of the individual to whom the information pertains, according to the DPPA. Hence, option D is the correct answer.

Option A is incorrect, as law enforcement agencies performing investigations are exempt from the consent requirement under the first exception.

Option B is incorrect, as insurance companies needing to investigate claims are exempt from the consent requirement under the sixth exception.

Option C is incorrect, as attorneys gathering information related to lawsuits are exempt from the consent requirement under the fourth exception.

References:

[IAPP CIPP/US Study Guide], Chapter 8: Federal Privacy Laws, pp. 181-182.

CIPP/US Practice Questions (Sample Questions), Question 31.

In 2012, the White House released a report titled “Consumer Data Privacy in a Networked World: A Framework for Protecting Privacy and Promoting Innovation in the Global Digital Economy”, which proposed a Consumer Privacy Bill of Rights based on the Fair Information Practice Principles (FIPPs). The report called for a comprehensive privacy framework that would apply to all commercial sectors and all personal data, regardless of the technology or business model involved. The report also urged Congress to enact legislation to implement the framework and empower the FTC to enforce it. Similarly, the FTC released a report titled “Protecting Consumer Privacy in an Era of Rapid Change: Recommendations for Businesses and Policymakers”, which outlined a set of best practices for businesses to protect consumer privacy and foster innovation. The report also advocated for a comprehensive privacy framework that would cover both online and offline data, and apply to all entities that collect or use consumer data that can be reasonably linked to a specific consumer, computer, or device. The report also recommended that Congress consider enacting baseline privacy legislation and giving the FTC rulemaking authority to implement it. Therefore, both reports can be described as advocating a comprehensive approach to privacy enforcement, rather than a harm-based, self-regulatory, or notice and choice approach. References: White House Report, FTC Report, IAPP CIPP/US Study Guide (p. 31-32)