Data losses up over last year
A survey into the costs of online crime against businesses has found the cost of data breaches rising fast.
The survey, carried out by the Ponemon Institute, a privacy and information management research firm, looked at all financial consequences of data breaches involving consumers identity details. It found data breaches cost companies an average of $182 per compromised record, a 31 per cent increase over 2005.
‘The burden companies must bear as a result of a data breach are significant, making a strong case for more strategic investments in preventative measures such as encryption and data loss prevention,’ said Dr. Larry Ponemon, chairman and founder of The Ponemon Institute.
‘Tough laws and intense public scrutiny mean the consequences of poor security are steep and growing steeper for companies entrusted with managing stores of consumer data.’
According to the non-profit Privacy Rights Clearinghouse, more than 330 data loss incidents involving more than 93 million individual records have occurred since February 2005. The Ponemon study analysed 31 different incidents, with costs for each ranging from less than $1 million to more than $22 million.
‘Once again, the Ponemon survey illuminates the high costs companies will incur for failing to protecting their customers’ data,’ said Andrew Krcik, vice president of marketing for PGP Corporation, which commissioned the research.
‘The report shows companies must spend prodigiously to recover from data breaches. In fact, 72 per cent of respondents indicated that the cause of the data breach was because digital information was not properly protected.’