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It isn't just government. Any company with your credit card or SSN or even browsing history is collecting loads of data about you. They have to take explicit steps to sanitize data between warehouses and they only undertake the effort for fear of being sued.

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Is there any liability other than having PII data hacked?

There are government agencies that can give you a smack down for mishandling PII even if you're not hacked. They do do audits now and then although from what I've heard they are a little stone age in their methods and might not catch on if you're doing something shady unless it's obvious.

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