Can Your Clients Survive a Data Breach?
7 Main Street Cyber Breaches with Record Settlements.
We’ve all heard of the flashy newsworthy cyber incidents. There are lessons to be learned from those incidents but that is a topic for another day.
But what about the main street businesses?
Do they need cyber? Short Answer Yes!
Today we are going to dive into 7 smaller businesses that got hit with expensive cyber breaches.
To start, let's jump into a California insurance agency and what led to their $10.5M cyber settlement.
I have no affiliation or connection to them but reviewing the facts, it seems this agency like most insurance agencies wanted to grow. They decided to use automated technology to get more clients. Sounds harmless right? Records prove it was anything but.
In this process, this agency violated the Telephone Consumer Protection Act and got themselves into a lot of hot water for using robo dialers and pre-recorded voicemails.
This was back in 2013, we all know now that robocalls aren’t OK now but what about whatever technology is next?
Like maybe SMS?
A charter bus company in New York used automated SMS to solicit new customers in 2013 and got themselves into hot water to the tune of $49M. I am sure they also started with the best of intentions and by no means intentionally violated the TCPA. But it happened and resulted in a $49M settlement from a federal judge.
Those incidents had a common trend, actions taken by the business that resulted in damages. But in-action can also result in large settlements.
A regional New England grocery store chain failed to update its servers and as a result, had malware installed on it by hackers. This lead to customers credit cards being stolen and a final settlement of $252M
Ignorance is not always bliss when an Ohio church lost $1.75M due to a phishing scam. Long story short, the church sent payments to the hacker instead of the contractor building the new cathedral. It was only discovered money went to the wrong account when the contractor called to follow up on payments.
Sometimes it’s just the simple things that lead to a cyber incident.
Like in the example of a California junkyard that was hit with a $195,000 settlement for violating FACTA by simply having too much information on the printed receipt that was given to the customer.
Or the Pawnshop in Texas that was charged with a $600,000 settlement for improper document handling. In short, they were tossing records in the dumpster out back instead of properly shredding them. A minor incident some might say, but a heft penalty.
Or worse, it’s the unknown that can cause an issue like a dentist office in Missouri that had $205,000 transferred out of its corporate bank accounts using their own online banking logins.
Cyber coverage is inexpensive compared to even the most minor of these incidents. Yet, only 21% of small businesses have cyber coverage.
Interested in learning more about Cyber?
Download the RPS Cyber Handbook Here.
Or schedule a call and we can chat about it.
Views expressed are mine and don’t necessarily reflect those of my employer.