Why Global Firms Fail at U.S. Cyber Compliance
Expanding into the U.S. market offers immense growth opportunities—but for global firms, cyber compliance is often where strategies unravel. Despite heavy investments in cybersecurity and compliance abroad, many organizations find themselves blindsided by regulatory actions, lawsuits, and reputational damage upon entering the U.S. The root cause? A fundamental misunderstanding of how fragmented, enforcement-driven, and aggressive U.S. cybersecurity regulation is—particularly when compared to centralized regimes like the EU’s GDPR.
Recent FTC enforcement actions and headline-making cybersecurity incidents in 2024 and 2025 reveal just how costly this miscalculation can be.
Unlike the EU, where the General Data Protection Regulation (GDPR) provides a single legal framework, the U.S. cyber compliance environment is a patchwork of federal and state laws—each with unique definitions of “personal data,” reporting thresholds, and disclosure timelines. That complexity often catches foreign firms off guard.
A notable example is the February 2024 FTC settlement with Avast, the UK-based antivirus software provider. Avast was fined $16.5 million for selling users’ browsing data despite marketing it as “anonymous.” While this wasn’t a breach disclosure case, it demonstrated how U.S. regulators aggressively pursue deceptive practices—especially when they affect consumer data, regardless of company origin.
Moreover, many states enforce stricter rules than the federal government. Colorado, for instance, mandates breach notifications to its Attorney General within 30 days—failure to comply can lead to enforcement not just from state AGs, but the FTC as well.
Too many global firms assume the FTC’s jurisdiction ends at the U.S. border. It doesn’t. If a product or service touches U.S. consumers—even indirectly—it falls under the FTC’s oversight.
In 2024, the FTC finalized an order against Global Tel*Link Corp., a prison communications provider, and two of its subsidiaries. The settlement addressed charges that the companies failed to secure sensitive data of incarcerated individuals and their families, leading to unauthorized access and potential misuse. This action underscores the FTC’s broad authority over entities that handle U.S. consumer data, regardless of their location.
Then in late 2024, a Brazilian e-commerce platform became a cautionary tale. Despite the breach affecting only non-U.S. users, the FTC sanctioned the company for lacking MFA and vendor risk assessments. The agency argued that the platform’s weak controls created systemic risks for U.S. consumers. The settlement mandated a full security overhaul and third-party audits every two years.
The financial and operational risks of non-compliance are no longer theoretical. In July 2024, Delta Air Lines suffered a major disruption when a CrowdStrike software update crashed key systems, grounding over 7,000 flights and affecting 1.3 million passengers. Although the root issue was a third-party cybersecurity vendor, regulators—including the Department of Transportation—quickly launched investigations into Delta’s preparedness and transparency. Estimated losses exceeded $550 million.
Similarly, the SEC’s 2024 enforcement wave saw actions against firms like Mimecast and Check Point for failing to disclose breaches in accordance with its new four-day reporting requirement. Firms that downplayed or delayed their disclosures were penalized under securities law—proving that incident response isn’t just a technical matter, it’s a regulatory obligation.
In April 2025, the U.S. House of Representatives subpoenaed China Mobile, China Telecom, and China Unicom to investigate potential national security risks from their U.S.-based operations. Lawmakers expressed concerns that these state-backed firms could funnel data access to Beijing. Regardless of whether data was ever accessed inappropriately, the scrutiny shows how compliance in the U.S. now includes geopolitical dimensions that global firms must consider.
To avoid becoming the next cautionary tale in U.S. cyber enforcement, global firms must take proactive, tailored steps. This starts with mapping data flows early to identify where consumer and business data resides and which state and federal laws—such as California’s CCPA or the NYDFS regulations—apply. Firms should also move beyond one-size-fits-all frameworks like ISO 27001 and align their security programs with U.S.-preferred standards, particularly those issued by NIST, which regulators increasingly recognize as the benchmark for “reasonable security.” Incident response plans must be tested under real-world U.S. scenarios; if a company cannot meet the SEC’s stringent four-day breach disclosure rule, it is already out of compliance. Finally, vendor and third-party risk must be actively managed—because as the 2024 Delta-CrowdStrike outage demonstrated, supply chain weaknesses are not just operational liabilities, but regulatory exposures as well.
The U.S. market rewards companies that treat cybersecurity compliance as a core business function—not a checkbox. With regulators expanding their jurisdiction, enforcement, and expectations, global firms must evolve quickly or risk regulatory action, consumer backlash, and operational chaos.
In the end, success in the U.S. isn’t just about building secure products—it’s about navigating a uniquely complex regulatory terrain with precision, transparency, and adaptability.
Please send feedback, updates and acronyms to daniel.opio@itlegal.io
