Company Profile: A manufacturer with 400 employees
The Internal Revenue Service discovered that hundreds of fraudulent tax returns were filed on behalf of employees that work for the same manufacturing company. They notified the FBI, and the FBI alerted the manufacturer. The investigation determined that the personnel files of 298 past and current employees had been accessed.
According to the NetDiligence® Data Breach Cost Calculator the estimated costs of the 298 lost records for the manufacturer could be:
|Incident Investigation Costs:||$180,000|
|Customer Notification and Crisis Management Costs:||$29,000|
|Fines & Penalties:||$6,000|
According to the Ponemon 2015 Cost of Data Breach Study, an average event of this type impacts 28,000 records, driving the average cost to a business to $1,728,000.
|Legal Settlement Costs:||$558,000|
Risk Management Tips:
- Establish an information retention policy and include guidance on what types of information should be retained, how long it should be retained and procedures for destruction of unneeded data.
- Establish new hire training and regularly scheduled refresher training courses in order to instill the data security culture of your organization.
- Create, implement and test an incident response plan.
As Tim Francis likes to remind business owners and risk managers, all businesses are vulnerable: “It’s not a matter of if, but when.” Be sure to review your insurance coverage with your agent, broker or carrier to understand what cyber coverage you have and what you might need.
Read part 1 of Hacked! The cost of a cyber breach – Retail Industry
Read part 2 of Hacked! The cost of a cyber breach – Healthcare Industry
Read part 3 of Hacked! The cost of a cyber breach – Financial Industry
Read Part 4 of Hacked! The cost of a cyber breach – Technology Industry
by Rosalie L. Donlon, Property Casualty 360