Regulation of Big Data Use and Personal Data Privacy: The SEC and California Make Data a Priority Focus in 2020 | Arnold & Porter

2020 is not just an election year; it is also a year where regulators are signaling their intent to continue to increase their focus on big data and the privacy of personally identifiable information (PII). The recent announcement by the Securities and Exchange Commission’s (SEC) Office of Compliance Inspections and Examinations (OCIE) that it will focus on registered advisers’ use of alternative data during examinations is an indication that use of such data may soon be subject to additional regulatory constraints and oversight.

In addition, to the extent big data includes PII about California residents that is not regulated under the federal Gramm-Leach-Bliley Act or the federal Fair Credit Reporting Act, the California Consumer Privacy Act (CCPA), which took effect on January 1, 2020, imposes new requirements and constraints on investment advisers (and other companies, including an investment adviser’s portfolio companies) that collect such data. These entities consequently need to be aware of some of the important legal developments described below.

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