What is a Data Breach and its Impact on Business?
Updated: Jun 14, 2019
A data breach is an incident where information is accessed or stolen from a system without authorization. Cybercriminals infiltrate data sources and extract sensitive information either physically through accessing the network for the express purpose of stealing local files, or by remotely bypassing network security. The latter method is often used when targeting companies.
Protecting user data has never been more important than it is today. Strict regulations have been implemented, and now companies are not only required to announce if their systems are breached, but in accordance with the GDPR (General Data Protection Regulation) requirements, they also have to pay fines of up to four percent of the business’s annual turnover, if they transact with citizens of the European Union (EU).
Although many people have reached a point of desensitization to the frequent stories citing massive data breaches, compromised data can result in the loss of millions of private records. And it doesn’t just affect the breached company but also the individuals whose information is stolen. This is why cybersecurity is something that requires the full attention of businesses.
Data Breach Attacks
Listed below are the steps that are normally involved in a typical breach operation:
Step 1: Research – Cybercriminals seek out weaknesses in a particular company’s security (this can be the network, systems, or people)
Step 2: Attack – Contact is made by the cybercriminal via a social attack or network attack. With network attacks, infrastructure, system, or application weakness is used to gain access to a company’s network. Social attacks, on the other hand, have to do with baiting or tricking employees into providing access to the organization’s network. This can be done by either fooling an employee into giving their login credentials or by tricking them into opening malicious attachments.
Step 3 - Exfiltration: After accessing one computer, the cybercriminal can now attack the network. They can then tunnel their way to confidential files. Once they extract the data, the cyber attack is deemed successful.
As technology progresses, we’ve been moving more and more of our information into the digital world and as a result, these types of attacks have increased. Data breaches can hurt both businesses and consumers in many different ways. In addition to damaging lives and reputations, they are costly and take a long time to repair.
Listed below are some of the ramifications of a data breach:
Get in touch with us to find out more about our cybersecurity services and how you can protect your business now and into the future.
How a Data Breach Can Affect Your Business
A data breach has the potential to cause massive damage to any business. It not only affects your business’s bottom line but it can also destroy your business’ standing and the trust consumers have in you.
The impact of a data breach can be divided into three broad categories: Financial, Legal, and Reputation.
The downtime experienced as a result of a cyber attack often results in substantial financial losses for the affected business. The operational disruption caused by a data breach is usually underestimated, particularly among businesses that have inadequate formal resilience and continuity plans.
There is also the cost associated with repairing affected devices, networks, and systems so the business can get back on track – not to mention the financial loss from stolen payment card details and bank records.
The data stolen during a cyber attack often include corporate information and financial information, such as payment card or bank details. This has serious legal implications because of the data protection and privacy laws that have been passed in recent years. If the data in your care is compromised, you may face regulatory sanctions and fines if it is proven that you failed to install appropriate security measures.
Trust from the public is an element that is essential for any business that wants to succeed in the modern world. But this is something a lot of businesses take for granted – until it’s gone.
Reputation damage that results from a data breach can be the hardest aspect to repair. When you lose the public’s trust, it can lead to the loss of customers, a decrease in sales, and a reduction in your overall profits.
In fact, any damage to your reputation can even have an effect on your suppliers, partners, investors, and any other third parties that are vested in your business.
Online crime poses a threat to everyone on the internet. But what can you do about it?
Is there a way you can protect your business from ever having to go through this harrowing experience?
The good news is that there are cybersecurity measures that you can take to reduce the chances of a data breach happening in your business.
How to Reduce the Risk of a Data Breach
Cybersecurity is not an IT issue, but rather a business imperative. By adopting a comprehensive strategy for your business’s security, you can implement the proper protective measures that will help you avoid having disruption when hackers decide to strike.
In addition to keeping your perimeter security in place, you also need a data-centric solution that will allow you to have tighter control over which individuals can read specific data sets and files. Encryption affords you this type of control but it must be the right kind for it to be effective.
For instance, if a particular email or file is encrypted properly, it’s easy for you to have full control over the people who can read it. Even if you experience a data breach, the cybercriminals won’t be able to read the information.
An application of that nature will drastically reduce your risks of data breaches to acceptable levels, thus protecting your business from the potentially ruinous data breach costs.