The Federal Trade Commission has rescinded a Biden administration-era policy statement that asserted coverage over health and fitness apps under federal data breach notification regulations.

In a half-page statement posted Wednesday, the FTC said it “has determined that the statement – contentious at the time of issuance – provided minimal benefit and has been superseded by rulemaking.” The commission said the statement’s withdrawal also aligns with guidance from the White House to pursue a deregulatory agenda and avoid “unnecessary use of subregulatory guidance.”

Unlike a formal regulation, which carries the legally binding force of law created through a public rulemaking process, an agency policy statement is non-binding guidance that merely outlines how officials intend to interpret and enforce existing statutes. An FTC spokesperson told CyberScoop that the underlying policy including health apps remains codified through a regulatory update in 2024.

“Each of these reasons is independently sufficient to support the Commission’s decision to rescind this policy statement,” the FTC continued. “Parties understand that guidance generally creates neither substantive rights nor binding obligations.”

The initial policy statement, passed in a divided 3-2 vote during the Biden administration under then-FTC chair Lina Khan, asserted that health apps, fitness trackers and other connected devices were covered under an existing regulation requiring companies to disclose health-related data breaches to customers.

The interpretation targeted any “vendor of personal health records that contain individually identifiable health information created or received by health care providers.” Many health and fitness apps ask users to upload medical records and other health-related data in order to function effectively.

More recently, health and cybersecurity experts have pointed to similar regulatory gaps that exist for AI companies that make healthcare specific models that can answer questions, examine patient records and dispense medical advice to users.

The underlying Health Breach Notification Rule also triggers automatic notification when a covered entity suffers a breach of security, which can include both standard breaches and data losses as well as the disclosure of sensitive health information to third parties without users’ authorization. That would potentially put health apps on the hook for selling customer data to third-party data brokers and other entities-a standard formally codified in a binding 2024 FTC rule update.

A Sept. 2021 statement by the FTC justifies its interpretation by citing digital security and privacy provisions in the 2009 American Recovery and Reinvestment Act as well as gaps in major health privacy laws like the Health Insurance Portability and Accountability Act that allow such apps to handle and store sensitive personal health records or data without being subject to the same breach notification requirements as other health care organizations.

The FTC said it intended to enforce health apps under the law and subject violators to daily fines of $43,792 per violation.

“As many Americans turn to apps and other technologies to track diseases, diagnoses, treatment, medications, fitness, fertility, sleep, mental health, diet, and other vital areas, this Rule is more important than ever,” the FTC said in 2021. “Firms offering these services should take appropriate care to secure and protect consumer data.”

This week, the FTC voted unanimously to rescind the policy statement. But that unity is in part because President Trump fired Democratic FTC commissioners who voted in favor of the original rules, while advancing party allies as their replacements.

The two dissenting votes against the policy statement in 2021 were from Republican-appointed commissioners casting their dissents under a Democratic executive. Andrew Ferguson, a Republican commissioner nominated by former Democratic President Joe Biden, is now chair of an FTC filled entirely with Republican appointees, and has defended President Trump’s authority to fire and hire new commissioners at-will.

Update, 9/11/26, 4:15 p.m.: This story has been updated to clarify the impact of the FTC’s policy statement revision.

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McKesson said its business and distribution centers remain operational in the wake of a cyberattack it disclosed Friday that resulted in data theft and temporary service interruptions.

Attackers gained access to some of the health care vendor’s third-party applications and stole data associated with a subset of customers in the company’s oncology, multispecialty and medical-surgical business units, Francisco Fraga, chief information and technology officer at McKesson, said in a statement Saturday. 

McKesson is a major player in the healthcare sector, claiming it distributes about one-third of all pharmaceuticals used throughout North America. It reported $403.4 billion in revenue for the one-year period ending in March. 

The company’s size and critical role it serves also makes it a high-profile target for cybercriminals. McKesson did not identify the group behind the attack, but ShinyHunters, a cybercrime group known for targeting large organizations with extortion demands after stealing massive amounts of sensitive data, claimed responsibility.

The company declined to answer questions about ShinyHunter’s claims. Yet, on Friday, McKesson disclosed the attack in a regulatory filing while ShinyHunters added the company to its data-leak site. 

McKesson said it discovered the attack Aug. 25. A period of widespread data theft was over by then, following a four-day intrusion beginning Aug. 21, according to researchers.

“Upon discovery, we immediately activated our incident response protocols, launched an investigation, and engaged leading cybersecurity industry experts to support our response,” Fraga said in a statement. 

“We have reasonable assurance of no ongoing unauthorized activity in our systems. Customers can continue to connect to and use our systems and services as intended,” he added. 

While McKesson’s investigation continues, it faces a more urgent deadline of Sept. 1 from ShinyHunters, which is reportedly seeking a ransom demand in excess of $55 million. 

The company did not answer questions about any ransom demand or whether it responded to the alleged attackers. 

The circumstances of the attack against McKesson are similar to other recent victims of ShinyHunters. The threat group typically uses social engineering or abuses weaknesses in identity to gain access to cloud-hosted environments containing troves of sensitive or proprietary data, which it threatens to leak if the victim doesn’t pay a ransom. 

“Opportunistic data extortionists have been able to identify weaknesses within identity and access management, making these campaigns both cheap and scalable,” said Ian Gray, vice president of cyber threat intelligence at Flashpoint. 

“These attacks are particularly difficult to detect early because they often occur entirely within vendor-hosted environments using valid, socially-engineered credentials,” he added. “Since this activity mimics normal support or data-warehouse tasks, it typically doesn’t trip traditional malware alerts or show anomalies, meaning organizations often remain unaware of the breach until the extortionists make contact.”

Researchers have linked ShinyHunters to multiple attack sprees targeting major cloud platforms, including Oracle, Salesforce and Snowflake. The decentralized crew of cybercriminals was also linked to an expansive compromise last summer impacting hundreds of Salesloft Drift customers that put any platform integrated with the AI chat agent at risk as well. 

In April, ShinyHunters broke into the systems of Canvas — a central hub for K-12 and university coursework, exams, grades and communication — causing widespread outages and data theft. When an early deadline passed without payment, ShinyHunters escalated its pressure on Instructure, the company behind Canvas, by defacing the platform’s login pages with an extortion message that was visible to hundreds of schools.

Instructure ultimately relented and said it reached an agreement with the cybercriminals, insisting the stolen data was returned with assurances that other copies were destroyed.

The FBI issued a public service announcement about ShinyHunters days later, warning potential downstream victims of the threat group’s pressure tactics and claims.

In late July, less than a month before McKesson was hit, Health-ISAC warned organizations in the sector of an increase in successful attacks by ShinyHunters.

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As part of its “economic D-Day” against Iran, the Treasury Department designated four Iranians for sanctions Monday stemming from their alleged role in hacking critical infrastructure targets and waging cybertheft against the United States.

It’s the second time in as many weeks that the Trump administration has taken aim at the same group of alleged hackers, following on an indictment recently unsealed against cybercriminals that federal law enforcement authorities say are affiliated with the Tehran-based Mabna Institute.

A Treasury Department release points the finger at three people — Keyvan Fayyaz Ghareh Blagh, Saber Shahbazi Balujeh, Mohammad Reza Kadkhoda’i and Mojtaba Ghal’eh-Kuhi — as specifically conducting the hacks.

“Since at least late 2023, these three individuals have successfully compromised and exfiltrated data from multiple U.S. companies in various critical infrastructure sectors, including energy companies, defense contractors, healthcare institutions, information technology companies, and financial institutions,” the release states.

A fourth individual included in Monday’s sanctions, Mojtaba Ghal’eh-Kuhi, is listed as one of the leaders of the gang carrying out the Ministry of Intelligence and Security (MOIS)-directed attacks. Another listed leader, Behzad Mesri, first faced sanctions in 2018, as part of another round of sanctions focused on the Mabna Institute.

Finally, the Treasury Department designated one additional person Monday over related activity, Arman Kahzadian, for his alleged role in receiving or using business information stolen via cyber-enabled means.

The department said the Iranian hackers sometimes turn their gaze to domestic targets.

“The members of this group are also heavily motivated by personal enrichment and greed, leading some members to prioritize their own profits over operations that benefit the MOIS,” it said. “This has driven some of the group to target Iranian companies.“

Hackers that the U.S. government has identified as Iranian have been behind a spate of attacks on U.S. water facilities, despite denials from President Donald Trump himself about Iranian culpability.  The Treasury Department did not immediately respond to a request for comment Monday about whether the sanctions designees were involved in those attacks, nor has the National Security Agency responded to requests for comment on whether Iran was responsible for attacks at the center of an alert about attacks on water facilities.

Treasury Secretary Scott Bessent announced a fuller list of sanctions Monday as the war with Iran nears its five-month anniversary with no end in apparent sight.

“In the Second World War, D-Day marked the historic beginning of a campaign with our allies to target and drive the enemy from its positions, including those in third countries,” he said. “Today, in that same spirit, we are launching an economic onslaught against Iran’s financial connections around the globe. Our objective is to sever every economic lifeline that sustains this tyrannical regime until Tehran stands alone.”

There are questions about whether the sanctions themselves are likely to change any behavior, particularly based on how they will be enforced. Iran has vowed “consequences” for the United States.

As part of the sanctions announced Monday, according to the department, “Treasury is expanding the categories of Iran-related conduct that may be subject to secondary sanctions in the future, making it easier to take action against those facilitating the regime. Treasury has issued determinations against five critical sectors –– digital assets, technology, gold, aviation, and shipping––  that the Iranian regime uses to try to prop up its failing economy.”

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