Data Privacy And Security Risks

by Michael Volkov
Contact

imagesCA0GPX63If there is one issue which causes sleepless nights for business executives, it has to be data privacy and security.  While the laws are still being updated and drafted for new technologies and new threats, businesses need to address these issues now.

Financial and healthcare companies already face legal requirements for protecting consumer data.  These have been in place for many years but federal and state agencies are increasing regulation and enforcement actions.  Data breach and customer notification laws are in place in every state.  A federal uniform standard has not been enacted.

The plaintiffs’ bar is quickly latching onto class actions and other private enforcement actions to seek redress for consumers who have suffered privacy invasions.  With new technologies and new ways to capture and use personal information, the risks are increasing and lawmakers will be forced to respond by passing more legal strictures and regulations around such data.

In the big picture, companies face three basic types of risks: (1) external; (2) internal; and (3) human error.imagesCAJXUF02

External risks for data breaches occur when someone outside the organization “breaks into” the organizations information network to try to secure items of value – such as financial information, credit card numbers, personal codes and other information of value.  External actors obtain the information to sell to others in the “information black market” or use the information themselves to carry out fraud schemes.  For example, one of the important tools for healthcare fraud is Medicare and Medicaid identification numbers which are commonly sold in the information black market.

Internal risks for data security focus on when an organization’s employees or authorized users access the information network to secure personal information for their own benefit.  The employees or authorized third parties will steal the personal information for their own benefit to sell to other criminals or carry out their own schemes.

The third, and perhaps most overlooked risk, is human error.  Many times a security breach is the result of human error or security lapses.  An information security network may be improperly designed or implemented leaving some employees at risk for error and causing harm to the organization.  Even if network security controls are in place, employees or authorized affiliates or third parties can make mistakes.

It is obvious to point out that not all data breaches are alike.  Whatever the cause, poor planning and security steps can have a devastating impact on an organization.  The clean up process, the notifications and remedial steps can hinder an organization for years.  Civil lawsuits and possible state and federal enforcement actions are increasing and can result in fines and penalties.

imagesCADND47HEven aside from these obvious consequences, organizations can suffer serious reputational harm.  Public disclosure of data breaches is more common today.  Consumers, however, are taking greater account of these infractions because of increased sensitivity to the protection of personal information.

Information security does not mean adoption of a boilerplate policy with no change in network security protocols or systems.  As usual, information security starts with an assessment of existing security and identification of deficiencies and risks.  Once that is done, organizations need to determine what information needs to be secured and what types of rules and protections are needed to protect that information.  A holistic approach enables an organization to allocate information security resources to areas of greatest need based on a ranking of deficiencies and risks.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Michael Volkov, The Volkov Law Group | Attorney Advertising

Written by:

Michael Volkov
Contact
more
less

The Volkov Law Group on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.