In this digital age, hackers are always trying to get into businesses and take advantage of weak spots in their systems. The financial effects on the companies harmed are one of the most important and far-reaching effects of these kinds of breaches.
In this article, we'll look at a few real-life examples of big data breaches and talk about how they have cost businesses not only money, but also in the form of legal problems and damage to their reputations.
The Equifax data breach is a stern warning of how bad things can get for a business when private data gets into the wrong hands. Equifax was hit with a huge $575 million fine in July 2019 because the personal and financial information of almost 145 million customers had been stolen. This was one of the biggest fines ever for a data leak.
A researcher had told Equifax about the weakness, but the company didn't tell its customers until after the breach was found. This made the breach even worse. This shows how neglecting cybersecurity can cost you money in A big chunk of the fine—$300 million—was used to give affected users free credit monitoring services. the long run.
In 2013, Yahoo! had a huge security breach that affected its whole database and about 3 billion accounts, which is almost the whole internet at that time. It's shocking that the business didn't share this information for three years. The U.S. Securities and Exchange Commission (SEC) fined Yahoo! $35 million in April 2018 for not telling anyone about the breach. Altaba, Yahoo's new owner, also paid an extra $50 million to settle a class action case in September of the same year.
If companies don't tell the public and regulatory officials about data breaches quickly, they could face financial problems. This case shows how important it is to do so.
Someone got into 100 million accounts at Capital One in the US and 6 million accounts in Canada in 2019. Paige Thompson, a former Amazon Web Services software worker, took advantage of a configuration flaw in the company's web application firewall to break in. Because of this, the Office of the Comptroller of the Currency was going to fine Capital One $80 million.
Fined because Capital One "failed to establish effective risk assessment processes" when moving operations to a public cloud environment and then not taking quick action to fix the problems that were found. This case shows how ignoring cybersecurity steps during changes in technology can result in big fines and problems that last for a long time.
The 2016 Uber data breach, in which the accounts of 57 million users and 600,000 drivers were hacked, took a strange turn. Uber paid the hacker $100,000 to keep the hack a secret instead of telling anyone about it. This choice cost Uber a record-breaking $148 million in fines in 2018 for breaking state laws about telling people about data breaches.
The Uber story shows how important it is to be open and honest about a data breach in order to lessen its effects. Trying to hide these kinds of problems not only gets the company fined a lot of money, but it also hurts its image with customers and government agencies.
In the middle of 2022, a huge data breach happened at Alibaba, a Chinese online store that had 1.1 billion people. Names, ID numbers, phone numbers, real addresses, criminal records, and online papers of sensitive customers were made public by the breach. The hacker said they got more than 23 terabytes of data on Alibaba's cloud hosting computers and first told people about the breach on online forums.
The breach not only hurt customers' trust, but it also led to a lot of criticism for Alibaba and its founder, Jack Ma, because they didn't protect important computers at all. This event showed what could happen if you don't keep sensitive information safe, and it had big effects on both the company and its people.
On a Dark Web site in June 2021, information about 700 million LinkedIn users was put up for sale. The shocking number of 756 million LinkedIn users who were affected by this exposure is 92%. The hacker, who goes by the name "God User," said he could sell a list of 700 million LinkedIn users. The data was leaked in two waves.
This breach showed that even well-known platforms can be broken into, and it also showed how harmful it is to businesses that don't protect user data. Not only did LinkedIn have to deal with immediate consequences, but its reputation could also be hurt in the long run, which could hurt user trust and engagement.
The above examples show that data breaches have long-lasting effects on businesses that go beyond the instant financial penalties. A company can be in trouble with the law, lose customers, and have its image hurt for years. Nowadays, data is a valuable tool, so putting cybersecurity first is not only the law, but also a key part of keeping a strong and reliable business.
As a business that cares about keeping our clients and their info safe, we know how serious these examples are. To keep your information safe, Vudu Consulting puts strong cybersecurity steps at the top of our list of priorities. Get in touch with us to talk about how we can help protect your business from possible threats and make sure it will be successful in the long run.