The threat of insider data breach is not new for the online business world. In 2005, a former AOL software engineer stole 92 million screen names and e-mail addresses. This past January, major financial services company Morgan Stanley admitted that the information of 350,000 wealth management clients was stolen in an insider data breach — and as a result, account information of about 900 clients, including account numbers and names, were posted on the Internet.
With cloud storage and BYOD becoming more popular in the workplace, insider threats have become a leading cause of data breaches. As much as 30% of data breaches in the US in 2014 were caused by human factors, like negligent employees and lack of awareness.
These breaches don’t only happen in big corporations, though. According to a report from First Data, 90% of data breaches impact small-and-medium-sized businesses (SMBs) and an average cost of a data breach for a SMB is between $36,000-$50,000. SMBs are especially vulnerable to insider threats due to loose security plans. A 2014 Forrester report revealed that only 57 percent of the US and European SMB employees were aware of their corporation’s current security policies.
Insider data breaches can cost companies millions of dollars and even worse, loss in customer loyalty. To protect your business from unfavorable insider threats, here are three things SMBs and large corporations should know to enhance workplace information security.
What is an Insider Data Breach?
Insider data breach is defined as an intentional or unintentional incident in which sensitive, confidential and protected data, such as financial records, customer records, pricing data or debit card information, is copied, stolen or potentially put at risk by an authorized and legitimate user inside the company.
Among all types of data breaches, breaches caused by human factors are usually the most difficult to spot and prevent because it requires companies to set up a comprehensive security plan to monitor everyday business operations and recognize whether activities from legitimate and authorized users can cause potential harm to sensitive data.
What are the Consequences of an Insider Data Breach?
The three main consequences of an insider data breach:
- Unfavorable financial loss: This usually includes all compensations, fees of post-breach investigations and potential fines from industrial regulatory associations. In 2014, companies that suffered from data breacheslost about 29,000 records on average. In these incidents, every compromised record caused by human errors cost the company $201 on average.
- Lawsuits and investigations: Lawsuits and investigations can be long-drawn and put many limitations on business activities, which may eventually harm corporate operations. What’s more, some investigations are publicized, causing damages to the company’s reputation.
- Loss of Customer Loyalty: Losing customer loyalty in data breaches can be painful, because it typically takes a long time, if not forever, to gain their trust back. According to a Ponemon Institute study, 57% of the customers influenced by a data breach said they lost trust and confidence in the organization. What’s worse, 31% of customers said they terminated their relationship with the company after the breach.
What Can SMBs and Corporations Do to Prevent Insider Data Breaches?
It’s very difficult to spot and prevent an insider data breach. Since insider threats are from activities of legitimate users, setting up a firewall is no longer a good solution. However, having a comprehensive security solution at place can help organizations reduce the risk of insider data breaches and potential loss. According toa study from IBM and Ponemon Institute, having an incident response plan, a CISO appointment and strong security posture can reduce the cost per record in a data breach by $10 per compromised record.
Below are some suggestions on how to build your own protection guard against insider data breaches.
- Re-examine policies for employee conducts in your company: Before taking your budget to invest into technology, you should first take a careful look at the front end of your business, such as policies for internal processes and employee workplace conducts, to make sure that there is no obvious and vulnerable loophole that can be taken advantage of.
- Identify all Proprietary Accounts: Make sure you have a checklist of all databases, servers, operating systems and applications in your company, and keep record of privileged accounts that have access to these proprietary data. This checklist will make it easy for you to track employee activities amongst different applications and systems.
- Install Data Governance Solutions: It’s very important to make sure that sensitive corporate information is only shared in an authorized and secure circle. To achieve this goal, implementing a comprehensive data sharing policy to monitor and control all data access and sharing activities in your company is an important step. You can now easily find effective security solutions built for Google apps and other collaborative applications online.
- Safeguard Your Password: Remember to use complicated, 2 step verification passwords and to change them regularly. Moreover, make sure to guard them from unauthorized use by implementing a full activity capture and recording. By doing this, you can ensure that once an employee leaves the company, he/she can no longer have the access to your sensitive data.