Here at LibertyID, we like to remind our readers, clients, and community that the current cybersecurity climate dictates that a data breach will almost certainly affect every organization out there at some point. It’s no longer a matter of if but when this will happen. Believing that your business is somehow immune from this ongoing threat can set the stage for digital disaster.
With that ever-ominous public service announcement in mind, data breach planning is an indispensable tool for businesses of every size across all industries. Lasting success can be secured or squandered on this preparation alone. Even more, new data privacy regulations result in the need for ongoing compliance that many owners and insiders remain unaware of.
Importance of Data Privacy
Data is not so quietly becoming one of the most valuable global commodities. Personal information gets most of the attention relating to cybersecurity issues, and rightfully so, but there are various other elements involved in data privacy. Too often, privacy issues and concerns are only discussed after a security issue or data breach has occurred. This can create a problematic portrayal of how a business is addressing privacy concerns in consumers’ eyes.
Taking a forward-focused approach to data privacy can flip the script and demonstrate active attempts by your organization to stay ahead of the curve. A cybersecurity plan is essential to protect a business’s best interests, but the benefits extend beyond office walls. Informing customers, clients, and even employees of what steps are being made to address data security can increase trust and show that efforts exist with their ongoing wellbeing in mind.
This approach doesn’t need to be complex – transparency with how personal data is being managed and what steps are in place in the event of a breach can be all that is needed to boost consumer confidence.
The Rise of Regulations
Two significant data privacy regulation policies have been established in recent years, setting a precedent for how all businesses handle cybersecurity policies and data breach incidents now and in the near future.
The California Consumer Privacy Act (CCPA) is the first data privacy law to hit the books in the US. It went into effect at the beginning of 2020 to give consumers increased control and awareness of how businesses gather and use personal information (PII). Key aspects of the CCPA include granting to consumers the right to opt-out of the sale of PII, the right to know how a business collects and uses PII, and the right to delete PII that has been collected.
These rights are exclusive to California residents. However, the rules apply to any for-profit business that does business in California with an annual gross revenue of over $25 million or earns 50% or more of its annual income from selling the PII of California residents, among a few other parameters.
The General Data Protection Regulation (GDPR) established by the EU in 2018 sets a series of rules intended to protect the processing of personal data while establishing rules concerning the free movement of this data. This was the first major data privacy regulation to be put into action anywhere in the world, and the GDPR aims to increase consumer awareness of how their data is used, managed, and gathered.
The regulations established by the GDPR pertain to all countries and citizens of the European Union. This extends to any business that collects data on citizens of the EU, meaning that any company that provides a service or sells goods to people in Europe falls under the scope of the GDPR’s legal jurisdiction.
The US doesn’t currently have widespread data privacy regulations on a federal level that are as encompassing as the GDPR. However, there is an increasing number of laws in place that deal with specific types of data, such as the Health Insurance Portability and Accountability Act (HIPAA), the Fair Credit Reporting Act (FCRA), the Gramm-Leach-Bliley Act (GLBA), and the Children’s Online Privacy Protection Rule (COPPA). Increased public demand for data rights seems likely to push lawmakers to establish more extensive regulations that bundle many of the issues brought to light by the rules and acts above.
Compliance is Critical
The benefits of increased data privacy regulation are apparent for the general public. They also represent progress for personal cybersecurity concerns. Businesses need to understand the scope of these regulations to ensure that they remain in compliance to support consumer demands while also limiting the chance for legal and financial ramifications.
The CCPA establishes a harsh penalty of $7,500 for intentional violations of the act for each customer involved in a data privacy issue. It doesn’t take an accounting team to see how quickly these fines can add up if an incident involves thousands or millions of consumers, the size of which is often seen with larger data breach incidents. Penalties of up to $2,500 per customer are possible for unintentional violations, and consumers can also file private lawsuits for actual damages between $100 and $750.
Penalties established by the GDPR dictate that companies can be fined up to €20 million or four percent of global turnover (i.e., revenue) for the previous financial year, whichever is higher. Amazon made headlines earlier in the summer when a record $877 million was imposed because of how the company dealt with cookie tracking issues. Google was fined $56.6 million for a murky privacy notice and the Marriott hotel chain was hit with a $23.8 million fine because of a data breach.
Every business must establish protocols to follow established data privacy regulations. Doing so will make the process more easily navigable when future related laws are put into place while also demonstrating to consumers that their data rights and security are being taken seriously. Data breach and cybersecurity planning are essential to limit risks to your organization and its customers. This preparation is also critical to staying compliant, avoiding damaging fines, and remaining in trusted standing with consumers.
LibertyID is the leader in identity theft restoration, having restored the identities of tens of thousands of individuals without fail. If you retain personal information on your customers, now is the time to get data breach planning and a response program in place with our LibertyID Business Solutions data breach preparation program. With LibertyID Enterprise you can now add value to existing products, services, or relationships by covering your customers, employees, or members with LibertyID’s fully managed identity theft restoration service – at a fraction of our retail price – with no enrollment and no file sharing. We have no direct communication with your group members – until they need us.
Call us now for a no obligation proposal at 844-44-LIBERTY (844) 445-4237.