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Stewart Baker | 10.12.2021 9:09 PM
The theme of this episode is the surge of creativity in the Biden administration as it searches for ways to regulate cybersecurity and cryptocurrency without new legislative authority. Paul Rosenzweig lays out the Department of Homeland Security's entries in the creativity sweepstakes: New (and frankly pretty modest) cybersecurity directives to the rail and air industry plus a much more detailed (and potentially problematic) set of requirements for pipeline companies. Matthew Heiman describes a Justice Department plan for enforcing cybersecurity rules for federal contractors that should chill the hearts of management: an initiative that raises the prospect of whistleblower suits under the False Claims Act for failure to disclose breaches to the government. I suggest that this means the notoriously short tenure of the Chief Information Security Officer (CISO) at large companies will now come with a built-in retirement compensation package.
Creativity in regulating cryptocurrency was signaled both by the White House, which is working on a broader and more coordinated regulatory approach and by the Justice Department, which is planning a major criminal investigative approach to the industry. Nick Weaver gives us the details.
Paul covers a remarkably creative assertion by the Committee on Foreign Investment in the United States (CFIUS) of jurisdiction over a Chinese firm's purchase of Magnachip, a semiconductor company with virtually no ties to the United States. Despite having no obvious skin in the game, CFIUS insisted on a CFIUS filing under President Trump and then vetoed the deal under President Biden. I suggest that the claim of extraterritorial jurisdiction, which in other circumstances might have annoyed South Korea, is in this case a good way for South Korea to avoid taking heat from China.
Paul explains why the Facebook outage was a much bigger deal than Americans realized. If you were living in Costa Rica, the loss of Facebook and WhatsApp, he says, could have greatly complicated every aspect of daily life, including calling the fire department or other emergency services.
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