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Nationwide data breach bill clears a hurdle

House committee approves a bill that, if passed, would force all companies to notify customers when their data is exposed.

The Data Accountability and Trust Act (DATA) was approved by the U.S. House Energy and Commerce Committee last week and could soon be cleared by the House of Representatives. The bill, if passed, would mean all companies have to inform customers of security breaches that affect their personal data.

According to the Federal Trade Commission, ID theft cost American consumers $5 billion and businesses $48 billion last year. The bill would allow the FTC to enforce standards on keeping data, and make companies appoint a head of security who would produce best practice and audits up to five years after an event. Under the proposals, if a breach does occur, a company must notify any customers concerned and also tell the FTC, which can then demand an audit.

Dan Ilett of reported from London.