Nov 25 2008   2:57PM GMT

Data Breaches and Business Liability Part I

Arian Eigen Heald Arian Eigen Heald Profile: Arian Eigen Heald

The most significant financial impact of identity theft has yet to be examined. I believe that the risks to business and other institutions now include legal, reputation, financial and compliance risks that cannot be transferred.

Victims of identity theft are looking to recoup their financial losses and punish those people or institutions that enable identity theft to happen. The average arrest rate (according to law enforcement) is under 5% of all reported cases. Thieves do not have the resources to repay their victims by the time (or if ever) they are caught. Business does. If business organizations are providing the opportunity for identity theft to occur, they will be sued. We should make it our job to see that we are not among the defendants.

According to the Identity Theft Resource Center, (An outfit that I happen to respect a lot because they are very specific about their statistics and criteria of what a “breach” actually is), As of November 11, 2008 there have been 574 breaches, with a total of 33,593,557 records exposed.

You can download the report at their site. It’s painfully interesting.
Here’s how it breaks down, keeping in mind that we’re not done with 2008 yet:

Category: Banking/Credit/Financial
Number of breaches: 66
Number of records: 17,231,057
Overall % of breaches: 11.5 (2007? 7%)
Overall % of records: 51.3% The fewest breaches, but the most loss of data. Thieves are not stupid.

Category: Business
Number of breaches: 202 The most number of breaches. We need to get much stronger here
Number of records: 5,705,628
Overall % of breaches: 35.2% (2007? 29.3%)
Overall % of records: 17%

Category: Educational
Number of breaches: 120
Number of records: 761,303
Overall % of breaches: 20% (2007? 24.7)
Overall % of records: 2.3%

Category: Government/Military
Number of breaches: 100
Number of records: 2,656,407
Overall % of breaches: 17% (2007? 24.5%)
Overall % of records: 7.9%

Category: Medical/Healthcare
Number of breaches: 86
Number of records: 7,239,162
Overall % of breaches: 15% (2007? 14.5%)
Overall % of records: 21.5%

Why do these statistics matter? Because, one way or another, every business and every person is affected.

 Comment on this Post

There was an error processing your information. Please try again later.
Thanks. We'll let you know when a new response is added.
Send me notifications when other members comment.

Forgot Password

No problem! Submit your e-mail address below. We'll send you an e-mail containing your password.

Your password has been sent to:

Share this item with your network: