The Escalating Costs of California’s New Privacy Mandates
Compliance with the California Consumer Privacy Act (CCPA), as amended by the California Privacy Rights Act (CPRA), is a mandatory legal obligation for covered businesses, with significantly increased financial and operational risks starting in 2025.
The Critical Risk: Escalating Fines and Penalties
As of January 1, 2025, the California Privacy Protection Agency (CPPA) increased monetary thresholds and fines to align with the Consumer Price Index.
Civil Penalties: Businesses face up to $2,663 per unintentional violation and up to $7,988 per intentional violation or those involving minors.
No Total Cap: Because each individual consumer affected by a breach or non-compliant practice can count as a separate violation, total fines for large-scale data incidents can quickly reach millions of dollars.
Private Right of Action: Consumers can sue for statutory damages between $107 and $799 per incident (or actual damages) following a data breach involving unencrypted personal data.
Key Deadlines and New Requirements (2026–2028)
Regulators have moved from a passive to an active enforcement model, removing the mandatory "grace period" for fixing violations before penalties are applied.
Mandatory Risk Assessments (Effective Jan 1, 2026): Businesses must conduct risk assessments for "significant risk" processing, such as selling/sharing personal data or using sensitive information.
Automated Decisionmaking (ADMT): New requirements for technologies that replace human decision-making (e.g., for credit or employment) go into effect, with a compliance deadline of January 1, 2027.
Mandatory Reporting: Organizations must begin reporting their risk assessment activities to the CPPA by April 1, 2028.
Does This Apply to My Business?
A for-profit business must comply if it does business in California and meets any of the following:
Gross annual revenue exceeds $26.625 million (updated for 2025).
Buys, sells, or shares the personal information of 100,000 or more California residents or households.
Derives 50% or more of its annual revenue from selling or sharing personal data.
Operational Impact of Non-Compliance
Beyond fines, non-compliance can lead to court-ordered injunctions, mandatory regular audits, and the required deletion of valuable data assets. It also risks significant reputational damage and customer churn, as modern consumers increasingly prioritize data security when choosing where to spend.
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