5 Ways Cybercrime Can Destroy Your Business
Clients who avail our IT Security solution can be assured that they will enjoy lesser cyber security attacks and their serious effects upon network compromise. But you should also know that there is definitely no 100% assurance you will not get compromised – you can just set up extraordinary protections that will decrease the odds of cyber theft, secure data and make it recoverable, and show your team, customers and legal officers that you WERE responsible and not negligent.
Realize that we are systematically assessing ALL our customer network systems, and recommend NEW protections that we thing you should set up.
1. Reputational Damages
What’s more reprehensible than a cyber attack? Attempting to cover it up. Companies like Yahoo! discovered this lesson in a difficult way. When they knew about the hacking, they DID NOT promptly disclose it to their clients, thus, they were confronted with multiple class-action lawsuits. Tools such as those used in the dark web can easily track the source where the data was stolen from. So, you cannot hide a cyber theft.
When hacking occurs, do you think your customers or patients will give you consolation? Have compassion? News will break out fast and non-parties may feast on it especially in social media. Clients will be disgruntled and will insist for answers: “Have you been responsible? What protections did you put into place(Which we outlined in this article)? Or you’ll just tell your customers, “Sorry, we think this kind of cyber hacking won’t happen to us,” or “We don’t want to spend extra cash.” These are not enough to appease them.
2. Government Fines, Legal Fees, Lawsuits
Most of the lawmaking activities today revolve around data security. The government is enacting and enforcing more stringent guidelines and imposing heavier penalties on computer breaches. The courts DO NOT FAVOR you if you compromise customer data.
Don’t assume that this only applies to large businesses: ANY private enterprise, whether big or small, that gathers client data will be obliged to inform clients in case of cyber compromise. Truth be told, 47 states and the District of Columbia each have their respective data breach statutes – and they are getting severe through time.
In case you are healthcare of financial services provider, you have extra obligations under the Securities and Exchange Commission (SEC), Health Insurance Portability and Accountability Act (HIPAA), and the Financial Industry Regulatory Authority (FINRA).
In case you’re in medical care or financial service industries, you have extra notice prerequisites under the Health Insurance Portability and Accountability Act (HIPAA), the Securities and Exchange Commission (SEC), and the Financial Industry Regulatory Authority (FINRA). In addition, HIPAA specifies that if a medical-related business encounters a data breach above 500 clients, it should inform a media agency about the occurrence. The SEC and FINRA likewise require financial service providers to reach them about cyberattacks, like any other government agency.
As an IT consultant and provider, we make sure that our clients stay compliant and have the proper protections in place.
3. Expenses, Damages, and Avoidable Losses:
A single ransomware attack, data hack, or rebellious employee can cost you unnecessary expenses, damages, and losses that could have been prevented in the first place. On top of that, there are operations interference, network downtime, delays, and piling of work. Loss of deals. Investigation and legal fees will devour your income just to figure out what sort of breach occurred and what information were compromised. IT restoration costs, if possible, to put back your operations again.
Cyber hackers may demand ransom from you, usually through a cryptocurrency deposit, and maybe – just maybe – you will get your data back. Then, there are expenses for litigation, attorneys, and expenses for reaching the media. Your income will be deeply disturbed, and your financial structure will implode. A few states give compromised businesses mandatory credit observation for a year and expect that more entities will follow accordingly.
The assessed cost per stolen client record ranges between $150 to $225 each. This is after IT recovery, lost income, downtime, fines, and legitimate charges are computed. How many employees and customers do you have? Multiply that by $50 on the conservative side and you’ll begin to get a feeling of the damages that a breach can bring to your organization. (Note: The highest cost per data breached belongs to the healthcare industry)
4. Banks are Not Liable by Law to Reimburse You
If your bank deposits were hacked, the bank is NOT liable by law to reimburse you. Here’s the true story of Verne Harnish, best-selling author and CEO of Gazelles, Inc., a prominent and notable counseling firm. One of his famous books is The Rockefeller Habits.
A True Bank Hacking Story Where the Money was Never Returned
Hackers were able to access the PC Harnish, intercept the email correspondence with his assistant, and stole a whopping $400,000 from his account. The hackers, believed to be from China, tricked Harnish’s assistant telling her to send money to 3 different locations. For the assistant, it was all a normal procedure since she was tasked to actively assist in financing a number of real estate ventures. Communicating under disguise, the hackers assured her that they are “Mr. Harnish” until she ultimately agreed to wire the funds. The hackers proactively erased the bank alerts sent automatically to the owner. Harnish also didn’t notice them because of his tight work schedules. He wasn’t able to get that money back, and the bank was not responsible and was legally protected.
Do you still believe that one single is not capable of one single error that could compromise the whole organization? Do you still keep rehearsing in your mind, “NOT ME, NOT my business, NOT my employees?” Can one small poor decision take away all of what I built for? In the same logic, nobody believes they will be in a car crash when they leave their house each day, and yet they put the safety belt on. You don’t anticipate a deadly accident every day, yet you still put your seatbelt on. What if?
5. Using YOU to Breach Your Clients
Some programmers won’t steal your money or hostage your data for ransom. There are some that will take advantage of the vulnerabilities of your network, server, or website to spread viruses to and compromise your clients.
Once they hack into your system, they can use it to transfer spam, launch ransomware, develop bots, build link farms, or promote their political or religious agenda.
This is also why it is better to install web gateway security, spam filtering, endpoint security, SIEM (Security Information and Event Management), and other items we detailed in this article.