Have you ever found yourself skimming through daily news reports only to see headlines like, “Facebook data breach results in leaked details of 500 million users” or “3 billion Yahoo accounts breached”?
Yeah, companies can get into serious trouble if they let a data breach sneak in through their defenses. And nobody wants to pay big bucks or lose reputation over it, right?
So, what should a company do after a data breach?
Before we answer that question, let’s figure out what a data breach is first.
What is a data breach?
A data breach is when hackers gain access to sensitive data after launching a cyberattack on company databases. These incidents happen due to loopholes in data security since many organizations fail to take proper security measures to protect both company and customer information.
The information exposed can start a chain of cybercrimes on a personal level, as intruders can use your sensitive information for financial gain.
First, identity thieves use the stolen data (Social Security Numbers/National IDs) to commit identity theft. This crime causes a chain reaction of others:
- Tax refunds;
- Healthcare fraud;
- Opening new credit cards under your name;
- Selling your private information on the dark web.
On the other hand, if the breach involved bank account information like a credit card number, criminals could use it to spend your money, take out loans, and so on.
That’s why a breached company must have an effective data breach response: to protect corporate data and the online privacy of their customers and employees.
If you’d like to learn more, here’s one of our useful videos on data breaches:
What happens when a company suffers a data breach?
A data breach can cost a company financially and in other ways due to exposure of personal information. Financial data like bank account numbers are especially vulnerable, but hackers can retrieve much more than you think.
Also, many believe that data breaches are a plight only for giant tech companies, but that is simply not true. The truth is that hackers commit more than 40% of all data breaches against small businesses, which means that any company can become a target.
By the way, some companies suffer not one but multiple data breaches.
Here are a few problems that data breaches can cause:
- Dissatisfied customers;
- Government fines;
- A decrease in stock price;
- Operations problems;
- Attorney fees.
However, that’s not all, as some issues persist for a long time:
- Security investigations;
- Loss of consumer and partner trust;
- Theft of intellectual property;
- Damage to the brand and reputation.
How should a company respond to a data breach?
If a data breach happened to your company, here are a few tips:
- Gather people from vital teams.
Include people from teams like information technology, human resources, legal, and so on. Choose a leader for the data breach response team and make sure the process is swift as time is money, literally.
- Notify affected customers and other parties.
Transparency is key here. The longer you take to disclose information to your customers, employees, partners, vendors, and appropriate government agencies, the harsher the consequences will be.
- Isolate affected systems.
You can prevent a breach from causing further harm if you identify the exact computer, server, or database infected with malware or caught up in phishing. Make sure to cut off access to other devices and data.
- Find out the legal requirements in your country.
The requirements for data breach incidents vary by country and state. They relate to informing customers, which government authorities you should contact, consequences, etc.
- Identify the issue.
Consult with cybersecurity experts to find out why the data breach happened and how you can prevent such security breaches in the future. ‘Cause nothing feels worse than getting breached the same way again.
- Investigate what data was leaked.
Personally Identifiable Information (PII) such as Social Security Numbers, birthdates, phone numbers, and financial information like credit card numbers and bank account details can complicate the situation. You need to assess the possible damage and the measures you have to take.
- Encourage employees to change their login credentials.
Changing passwords will restrict access to other existing accounts for criminals. Make sure they use complex passwords: at least 12 characters long, with upper-case and lower-case letters, numbers and symbols. It’s also essential to use unique passwords so that other accounts remain safe.
- Display clarity in public relations.
Schedule press releases that reveal the exact facts and don’t hide anything about the incident. Transparency will reduce the reputational damage for your company. Think about the questions that people might ask and answer them.
- Check your credit reports.
Suspicious transactions will appear in credit reports along with the places where the money was spent and at what time. You can then report the fraudulent charges.
What can a company do about data breaches in the US?
There are some other actions you can take if you live in the US specifically, suggested by the Federal Trade Commission (FTC):
- Contact the major credit bureaus.
If criminals steal your Social Security Number, they can provide a piece of advice, and you can request a fraud alert and credit freeze for your credit file to keep financial accounts protected. The three major credit bureaus are Equifax, Experian, and TransUnion. You can also request a free credit report of your credit annually from one of them here.
- Offer free credit monitoring and other support.
Identity theft protection services will be helpful to the harmed parties, especially if financial data or Social Security Numbers are exposed.
- Check your state laws.
Breach notification requirements and legal obligations vary by state, so it’s crucial to determine the criteria. These requirements can include how affected parties have to be informed: via email, cell phone, text message, etc.
- File a police report.
You need to contact the government after a data breach. If your local police department is not capable of handling cybersecurity cases, you will need to contact another branch or the FBI.
How can companies prevent data breaches?
Yes, taking measures beforehand is always the better option. Here are a few tips:
- Keep your data security tight.
Have a team or someone capable (the IT guy!) monitor your systems and patch any loopholes. This way, you should be able to avoid a breach altogether.
- Have legal help on standby.
Make sure you have a lawyer you can rely on for cyber incidents. Lawyers often specialize in one sphere or another, so it’s best to keep in contact with someone that knows a thing or two about data breaches.
- Restrict access to your most valuable information.
Only grant access to employees that need specific data, especially financial information. It is a common mistake when employees have access to more data than they need for their work. This restriction will limit the amount of information hackers can obtain.
- Organize employee security training.
Employees are often taught proper security practices once or never at all. Security experts should organize training sessions at least a few times a year to spread awareness.
- Update software.
Outdated operating systems and programs are easier to crack, and hackers can usually steal personal information from them in just a few minutes. Updates contain security upgrades, so it’s essential to install them regularly.
- Create a data breach response plan.
A company needs to have a plan in case a data breach occurs. Disorganization can lead to discontent among employees and customers. That means even more damage across the board.
- Require employees to use strong passwords.
New accounts should have a solid and unique password, and any reused or weak passwords of existing accounts need to be changed immediately. Make it much harder for hackers to brute force their way into accounts.
- Use Surfshark Alert.
It is a reliable option for monitoring employee details for breaches as it scans the whole internet in just 2 days. You can find out more about Alert here.
What should you do about a data breach?
Even though it’s companies that suffer from data breaches, your digital security is the number one priority. Here are a few guidelines that can help you:
- Make sure the data breach notification is legit.
Hackers are known to send spam emails disguised as breach notifications. Make sure to check the company’s website or to contact them directly. DON’T CLICK ON ANY LINKS as they can be a phishing attempt to leak your personal information.
- Log in to the breached account and change your password.
Time is of the essence here. Make sure you follow the strong password recommendations mentioned before or use a password manager. Don’t reuse passwords or use the same one for several accounts.
- Delete unused accounts.
It’s best to delete an account if you don’t need it. Doing so will reduce unnecessary digital footprint and might help you avoid a breach entirely.
- Use Surfshark Alert.
Alert is a handy tool that lets you add unlimited email addresses, credit cards, and national IDs for data breach monitoring. Alert scans the largest data breach database and swiftly informs you about any old and new breaches.
Are companies liable for data breaches?
Yes, but only sometimes. Businesses may be at fault when a data breach occurs because of mishandling of data and lacking security before the breach. Especially if the breach involves such information as Personally Identifiable Information or financial data.
That means customers can sometimes sue them if criminals cause apparent damage with the stolen details.
However, the process is different for every country and state, meaning that it highly depends on your local laws.
In a nutshell, are data breaches a serious threat?
The short answer is yes. Data breaches are dangerous to companies, their employees, and customers, as criminals can use the stolen data for crimes like identity theft and various financial frauds.
Imagine someone impersonating you or swiping your credit card wherever they please. You wouldn’t wish that even on your worst enemy, right?
So why not take advantage of Surfshark Alert to keep an eye out for data breaches?
FAQ:
What is a data breach?
A data breach is data exposure to third parties after a successful cyberattack on company databases. Such incidents can cause significant harm to both businesses, the people they employ, and their customers as criminals can use the stolen data for various crimes. Examples include (but are not limited to) identity theft, tax return fraud, healthcare fraud, and impersonation.
How can companies prevent data breaches?
Companies can prevent data leakage by improving their data security practices as breaches occur due to loopholes in the infrastructure. Also, having a breach response plan helps to avoid miscommunication, confusion, and taking a long time to resolve the problem. Lastly, training employees to be aware of security requirements is a must.
What happens when a company has a data breach?
In short, it costs a lot financially, disrupts operations, and causes damage to brand reputation and the trust of their partners and customers. It’s essential to act as fast as possible and be completely transparent with customers, employees, and partners to prevent any further damage.
How should a company respond to a data breach?
There are many tips, but the key is to take care of your infrastructure, have a lawyer or legal team, and notify all involved parties as quickly as possible. Make sure a breach doesn’t happen again for the same reason, as there’s nothing worse than multiple breaches. Be as transparent as possible with employees, partners, and customers to regain trust.
