In the fast-moving world of technology, data breaches have become far more common and far more sophisticated. When a data breach occurs, beyond the basic inconvenience and cost associated with it, for many organizations, there is a regulatory impact. For those organizations, regulatory agencies take over to get to the bottom of the issue, and they will consider many factors when determining an appropriate fine. These factors include the severity of the breach, the number of individuals affected by the breach, the response and remediation efforts by the organization, and the organization’s compliance history, as well as factors like evidence of intentional misconduct or negligence.
So, what is there to worry about? If you work in an industry or organization subject to regulatory authority, plenty. Here is a summary of from whom you can expect to hear, as well as the regulatory fines.
Personal Information Protection and Electronic Documents Act (PIPEDA):
- Jurisdiction: Canada
- Applies to most organizations doing business in Canada
- Compliance is crucial for establishing trust with consumers
- At this time, businesses and organizations can be fined up to $100,000 CAD for each violation.
General Data Protection Regulation (GDPR):
- Jurisdiction: European Union
- Applies to organizations processing personal data of EU residents
- Fines for non-compliance with GDPR provisions, including data breach notifications
- Imposes fines of up to 4% of a company’s global annual revenue or €20 million, whichever is greater.
California Consumer Privacy Act (CCPA):
- Jurisdiction: California, USA
- Applies to businesses collecting personal information of California residents
- Provides specific rights to residents and imposes fines for non-compliance, including data breaches
- Fines of up to $7,500 per violation.
Health Insurance Portability and Accountability Act (HIPAA):
- Jurisdiction: United States
- Applies to entities handling protected health information (PHI)
- Imposes fines for non-compliance with HIPAA provisions, including data breach notifications
- Fines of up to $1.5 million per year for violations.
Federal Trade Commission (FTC):
- Jurisdiction: United States
- Imposes fines under Section 5 of the FTC Act for unfair or deceptive acts related to data breaches
- Legal actions taken against organizations violating privacy rights or failing to maintain security
- The FTC may bring civil actions for civil monetary penalties of up to USD 40,000 per violation of the FTC Act or COPPA. Each day that non-compliance continues is considered a separate “violation” for purposes of the law. In 2019, for example, the FTC fined Facebook $5 billion for its role in the Cambridge Analytica scandal.
Payment Card Industry Data Security Standard (PCI DSS):
- Developed by major credit card companies
- Designed to protect credit and debit card transactions from data theft and fraud
- Compliance is expected for companies handling card transactions, though PCI SSC itself lacks legal authority
- $5,000 to $100,000 per month for PCI compliance violations.
ISO 27001 vs SOC 2:
- Compliance with ISO 27001 and SOC 2 is not legally mandated in the United States
- No direct penalties for non-compliance
- Compliance may help reduce fines and penalties in the event of a data breach
The bottom line: for many organizations, adroit cybersecurity can pay tremendous dividends, if only in avoided costs and fines. It is absolutely essential for every organizations to be aware of, and comply with, appropriate regulations to protect sensitive data and avoid potential fines.
And that’s where Stratix Systems can help.
Stratix Systems delivers a full suite of effective cybersecurity and compliance services –multi-layer protection to prevent cyber threats from damaging your network, applications, data, and confidential information. There is also Backup and Disaster Recovery, which saves you time and money with simple, secure and affordable backup solutions for company data, financial records, administrative materials and so much more.
Whatever your organization’s needs for cybersecurity, Stratix has the experience, people, resources, practices, and technologies to help you protect your systems and information and take your organization to the next level. Visit https://stratixsystems.com/managed-it/cybersecurity/ to learn more.