What Are The Biggest Risks of Data Leaks?
Protecting yourself against data leaks should be one of your biggest concerns, otherwise you could be facing catastrophic consequences for years to come.
Key Points:
- Data leaks can result from various sources, including human errors, such as falling for phishing attacks, malware infections, internal threats, or third-party compromises. Building a robust human firewall and securing cloud environments are essential preventive measures.
- Data leaks can lead to significant financial losses, regulatory fines (e.g., GDPR fines), reputational damage, loss of trade, business disruptions, identity theft, and legal consequences. The impact can be long-lasting and affect various aspects of a business.
- Proactive measures to prevent data leaks include implementing multi-factor authentication, maintaining a strong overall security posture, and minimising stored data using data security tools like Metomic, which can help redact information automatically and reduce exposure in case of a leak.
Experiencing a data leak is a terrifying prospect that most security teams dread.
With technology more sophisticated than ever (and becoming more sophisticated still), hackers are finding new ways to exploit vulnerabilities and expose data for their own financial gain or simply for the satisfaction of saying they could do it.
Protecting yourself against data leaks should be one of your biggest concerns, otherwise you could be facing catastrophic consequences for years to come.
How can data leaks happen?
Data leaks can happen in a number of ways, not all of them from a malicious perspective.
In fact, 82% of data breaches contain a human element that can sometimes be accidental. For example, one of your employees might fall victim to a phishing attack, putting your entire business at risk.
To prevent this from happening, building your human firewall should be your top priority, ensuring your employees are aware of potential threats and how to handle them.
Hackers could also deploy malware to infect your cloud environment, and any computers connected to it, giving them access to your data.
The threat doesn’t always come from the outside either; there could be unhappy employees within your ranks who have access to sensitive data. If they have malicious intentions, they can leak your most confidential data easily.
Dan Russell, Cybersecurity Expert at Metomic says, “Third parties like your supply chain partners who have been compromised could also put you at risk of a data leak, as well as information that may have been intercepted due to unsecure connections. As more people work remotely, the threat of man-in-the-middle attacks is becoming increasingly real.”
What sort of damage can data leaks cause?
As if it’s not bad enough having your data stolen or leaked in the first instance, there can be more damage you’ll have to deal with, including:
- Financial loss
When many people think of data leaks, they think of the financial impact to the business, which could be devastating.
T-Mobile, who have recently suffered their second data breach of 2023, said it may ‘incur significant expenses’ as a result. The breach saw PINS, phone numbers and full names of customers exposed, which also leaves them in a vulnerable state.
Remember that companies complying with regulations such as GDPR will also have to pay up to 20 million euros or 4% of their global turnover - whichever is higher - if their business is hit by a data leak.
- Reputational loss
A 2019 Aon report found that reputational damage is the no. 1 risk to businesses after a cyber attack, due to the lasting impact it can have on the company.
Within the report, they cited Capital One’s data breach that incurred a loss of 6% on the company’s share price, showing the decline in confidence for the brand.
- Loss of trade
In Deloitte’s ‘Beneath the Surface of a Cyber Attack’ report, the huge impact on the loss of trade was revealed.
The devaluation of their trade name cost a health insurer $230m and lasted for 5 years after the incident, as customers chose to put their cash with competitors. It’s important to keep in mind that the impact of a cyber attack is unlikely to go away quickly.
- Disruption to business
Within the same report, a US technology manufacturer experienced disruption to business following a data leak that cost them a massive $1.2billion as sales were halted and their security features were put under the microscope.
Afraid that a competitor might have stolen their IP, they re-evaluated 15 product lines, slowing them down even more when it came to turning a profit.
- Identity theft
If a company holds PII, and that data is leaked, it may not just be the company that feels the effect.
A customer could have their data stolen and sold on the dark web, resulting in identity theft or fraud. This can have financial implications, as well as emotional and psychological consequences too.
- Legal consequences
As well as dealing with financial and reputational damage, you may have a lawsuit brought against you by an official body, or individuals who have had their data leaked.
This is particularly apparent when companies fail to disclose the details of the data leak within the allotted time, and try to cover it up instead. It’s always best to be honest from the get-go with these things, and work with authorities to figure out what went wrong.
How can you prevent data leaks?
There are a few ways you can prevent data leaks and it starts by being proactive, rather than reactive.
Sheree Lim, Head of Product at Metomic, says, “Implementing multi-factor authentication to limit access to sensitive data is a great starting point, and helps your employees understand the importance of restricting access to only the relevant people.”
You should also make sure you have a strong data security posture all round, and that it’s constantly being reviewed and updated to deal with new threats that are coming up.
Finally, you should minimise the amount of data you store in the first instance by using a data security software like Metomic that helps you redact information on autopilot, without getting in the way of your employees. That way, if you are exposed to a data leak, the amount of data exposed will be minimal.
Get peace of mind with Metomic
If you’re looking to minimise the risks of data leaks as much as possible, Metomic might be the perfect solution for you.
Read about how James at TravelPerk got results in just a few days by using our platform.
