The Golden State Recognizes the Problem of Abandoned Records

These days it’s become an unfortunate (and common) sight:  Your favorite neighborhood shops suddenly closed due to tough economic times.

But with these shuttered businesses comes the critical problem of security and Personally Identifiable Information (PII). The topic of PII has been at the forefront of the news as it refers to information that can be used to uniquely identify, contact, or locate a single person or can be used with other sources to uniquely identify a single individual.

The problem arises after businesses close and may leave behind transaction and employee records often containing sensitive information such as Social Security or Identification numbers. Obviously, these are ripe for fraud or identity theft purposes. Storing these records are also a problem, as storage costs are incredibly expensive.

The California Legislature has viewed this as a problem and amended Section 1798.81 of the Civil Code to require a business to take all reasonable steps to dispose, or arrange for the disposal, of an individual's records within its custody or control containing personal information when the records are no longer to be retained by the business by shredding, erasing, or otherwise modifying the personal information in those records to make it unreadable or undecipherable through any means.

Section 1798.84 was also amended to read that a violation of this provision would be punishable as a misdemeanor if a business, including any employee or agent thereof, knowingly disposed of records containing personal information. In addition, a willful, intentional, or reckless violation may cost the violator up to $3,000 per violation.

The section further specifies that a cause of action will not lie with a business that comes into possession of the abandoned records containing personal information and disposes of them in accordance with the section’s provisions.