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Consent DecreeLow Risk

NJ AG Settles DealerBuilt Data Breach with $80K Penalty and Security Reforms

Lightyear Dealer TechnologiesSeptember 7, 2018New Jersey Attorney General

Penalty Amount

$49,420

Summary

Lightyear Dealer Technologies (DealerBuilt) settled an investigation into a 2016 data breach where a misconfigured file system exposed personal data, including social security numbers and bank information, of thousands of auto dealership customers nationwide. The settlement includes an $80,784 payment (with $20,000 suspended) and mandatory cybersecurity reforms.

Remedy

DealerBuilt must pay $80,784 (comprising $49,420 in civil penalties and $31,364 in reimbursed costs, with $20,000 of penalties suspended upon compliance) and implement comprehensive cybersecurity protocols to prevent future breaches.

Monetary PenaltyCompliance Program

Contract Impact

In-house legal teams should review all vendor and customer agreements where DealerBuilt (or any data management software provider) processes personal data on behalf of auto dealerships. Specifically scrutinize clauses governing data security standards, encryption of sensitive data (like SSNs and financial information), breach notification timelines and responsibilities, data retention and disposal schedules, audit rights for security assessments, and indemnification for data breaches. Given the settlement's mandated reforms, contracts may need amendments to explicitly require compliance with specific security frameworks, mandate regular penetration testing, enforce multi-factor authentication for database access, and require immediate notification of any misconfigurations or unauthorized access.

Contract Search Terms

data security protocolsencryption requirementsbreach notification proceduresthird-party vendor managementdata retention policiesaccess controlssecurity auditsincident response plandata processing addendumindemnification clauses

Laws Cited

New Jersey Consumer Fraud ActNew Jersey Identity Theft Prevention Act

Violation Types

Entity Details

Entity

Lightyear Dealer Technologies

Also known as: DealerBuilt

Industry

Technology

Official Sources

Source Evidence

Entity Name
"Lightyear Dealer Technologies"
Fine Amount
"$49,420 in civil penalties"
Laws Cited
"New Jersey Consumer Fraud Act ("CFA")"
Laws Cited
"New Jersey Identity Theft Prevention Act ("ITPA")"
Violation Types
"cyber security lapse that allowed unauthorized public internet access to a company database containing personally identifiable information"

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