Businesses have a responsibility to keep their data safe from potential cyber attacks, according to data regulators. However, in the event of a data breach, businesses must also notify their clients within a certain time frame.
As proof of their efforts, they must provide the necessary documentation. Although different regulations have established different requirements for breach notifications, the principle remains the same.
It’s a common misconception that ransomware attacks don’t involve data theft. However, no organisation that has been victimised by ransomware has been able to provide evidence to support this. Nevertheless, compliance regulations require businesses to notify their customers if their data is in jeopardy.
When it comes to alerting stakeholders about ransomware and data breaches, many businesses, however, frequently operate in a “grey area.”
In this blog post, we’ll explain why this approach can be counterproductive and why your company needs to adopt a comprehensive strategy that combines the best elements of compliance and cybersecurity.
Inspired IT provides our clients in Perth, WA with the technology, security, and support they require to succeed in the long run. We believe in assisting businesses in prioritising cybersecurity to ensure long-term success.
Contact our team at Inspired IT to learn more about our cyber security services.
Taking the “Grey Area” Approach
Because not all hackers can decrypt the data they’ve encrypted, many businesses appear to believe that not all ransomware attacks must be reported. They believe that hackers only can decrypt, exfiltrate, and misuse data during highly technical attacks.
These businesses only acknowledge that a breach occurred and that it is necessary to report it in such circumstances. However, this assumption can be risky and even dangerous for two reasons:
- With improved ransomware-as-a-service tools readily available on the market, even a novice hacker can catch you off guard and cause havoc.
- Regulatory agencies have different perspectives on the situation. What’s valid in one agency may be considered a violation in another.
For example, the US Department of Health and Human Services has advised companies to assume that ransomed data contains Personal Health Information, even in “low probability” cases, by HIPAA’s Privacy Rule.
Some data breach notification laws require businesses to notify customers even if the breach is caused by “unauthorised access.” There is no requirement to prove that personal information was stolen.
Why Some Companies Choose Not to Report Breaches
Accepting a data breach can be difficult for any business to access and own up to. Especially when the potential financial and repetitional consequences are considered. However, there are other reasons why businesses may choose to ignore these incidents.
Inability to Notify of Data Breach as Required
Although they are widely considered a fundamental requirement, most businesses are unable to follow the breach notification standards established by numerous regulations around the world.
Even if a company chooses not to report a ransomware attack, regulators may still take harsh action if the company fails to promptly notify its customers or clients.
The GDPR, the European Union’s data privacy, and protection regulation have established a 72-hour deadline for reporting the nature of a breach and the estimated number of data subjects affected. The clock starts ticking the moment a company’s IT team determines that a breach has occurred.
Would your Perth, WA business be able to comply with such regulations if they were required?
Perception of “Victim versus Victimiser”
Assume a company reported a ransomware breach to its stakeholders and the appropriate authorities. On the one hand, law enforcement agencies looking into the case would see the company as a victim, even if it paid the ransom.
Regulators, on the other hand, may view the company as a victimiser of its customers for failing to protect their data.
If an audit reveals that the company is not in compliance with the necessary security mandates, the regulators will take punitive action after considering several factors.
Reputational Risk
Customers are more likely to stop engaging with a brand after a data breach has been made public. After all, a business that fails to keep its house in order is not deserving of its business or confidential information.
Having said that, your company may be able to recover from the financial damage caused by ransomware-induced downtime. However, rebuilding its reputation and regaining the trust of its customers is a time-consuming, tedious, and often futile process.
This is one of the primary reasons why businesses do not report a ransomware attack.
You Need to Keep Risk at a Minimum
Unfortunately, there is no foolproof strategy for avoiding cybersecurity attacks like ransomware. Your company can still prove that it is committed to stopping security lapses or data loss incidents.
This is exactly what compliance regulators and your important stakeholders are looking for: how proactively your company can reduce risk and deal with the fallout from a breach while also abiding by the law.
Adopting a comprehensive strategy that incorporates the best cybersecurity and compliance practices is always a positive step.
Your company will gain a lot from working with a seasoned MSP like Inspired IT. We have a track record of safeguarding businesses from sophisticated cybersecurity threats and non-compliance risks.
Feel free to reach out to us right away for a consultation. Let us assist you in anticipating and addressing all of your compliance and cybersecurity needs.
