The biggest data breach fines, penalties and settlements so far

Hacks and data thefts, enabled by weak security, cover-ups or avoidable mistakes have cost these companies a total of nearly $1.45 billion and counting.

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British Airways: $230 million

Despite all threats and scare-mongering about the potential size of fines, the first 12 months of the EU’s General Data Protection Regulation (GDPR) had relatively little in the way of punitive action. Fines issued by data protection firms across mainland Europe that related to data breaches had been in the tens or relatively low hundreds of thousands of euros and generally were in line with the kinds of finds companies were receiving under prior regulations. With a lot of money being spent on compliance efforts and seemingly light punishment for failure, there was a growing worry that GDPR might actually be something of a damp squib.

That quickly changed after BA was fined a record £183 million [~$230 million], the highest data breach penalty to date and surpassing the $148 million Uber paid out in 2018. British Airways was fined by the UK’s data protection authority, the ICO, after the Magecart group used card skimming scripts to harvest the personal and payment data of up to 500,00 customers over a two-week period.

The ICO said its investigation found “poor security arrangements at the company” led to the breach. The BA fine shows that the regulation does have real teeth and the data protection authorities aren’t afraid to exercises their powers. Given that the GDPR has been one of the main drivers for pushing security higher up the agenda with boards, this will give CSOs and privacy/compliance offers renewed impetus to strengthen their security programs further.

Uber: $148 million

In 2016 ride-hailing app Uber had 600,000 driver and 57 million user accounts breached. Instead of reporting the incident, the company paid the perpetrator $100,000 to keep the hack under wraps. Those actions, however, cost the company dearly. The company was fined $148 million in 2018 — the biggest data-breach fine in history at the time — for violation of state data breach notification laws.

Marriott International: $124 million

GDPR fines are like buses: You wait ages for one and then two show up at the same time. Just days after a record fine for British Airways, the ICO issued a second massive fine over a data breach.

Marriott International was fined £99 million [~$124 million] after payment information, names, addresses, phone numbers, email addresses and passport numbers of up to 500 million customers were compromised. The source of the breach was Marriott's Starwood subsidiary; attackers were thought to be on the Starwood network for up to four years and some three after it was bought by Marriott in 2015. 

According to the ICO’s statement, Marriott “failed to undertake sufficient due diligence when it bought Starwood and should also have done more to secure its systems.” Marriott CEO Arne Sorenson said the company was “disappointed” with the fine and plans to contest the penalty.  

The hotel chain was also fined 1.5 million Lira (~$265,000) by the Turkish data protection authority — not under the GDPR legislation — for the beach, highlighting how one breach can result in multiple fines globally.

Yahoo: $85 million

In 2013 Yahoo suffered a massive security breach that affected its entire database, about 3 billion accounts — almost the entire population of the web. The company, however, didn’t disclose this information for three years.

In April 2018, the U.S. Securities and Exchange Commission (SEC) fined the company $35 million for failing to disclose the breach. In September, Yahoo’s new owner Altaba admitted that it had settled a class action lawsuit resulting from the breach to the tune of $50 million.

A total bill of $85 million for 3 billion accounts works out to around $36 per record. 

Tesco Bank: $21 million

Tesco Bank, the retail banking arm of the UK supermarket chain, was hit with a £16.4 million ($21.2 million) fine in 2018 by the UK’s Financial Conduct Authority (FCA) after just under $3 million was stolen from 9,000 customer accounts in 2016. The FCA accused Tesco’s of “deficiencies” in the design of its debit card, financial crime controls and in its Financial Crime Operations Team.

Target: $18.5 million

In 2017, retail giant Target agreed to a $18.5 million settlement with 47 states and the District of Columbia relating to a breach in 2013 in which some 40 million credit and debit card accounts were stolen during the post-thanksgiving Black Friday sales rush. Later investigations found names, addresses, phone numbers and email addresses for up to 70 million individuals were also taken. Total costs associated with the breach reach over $200 million.

Anthem: $16 million

U.S. health insurer Anthem suffered a breach in 2015 that impacted 79 million people. The breach included names, birthdates, Social Security numbers and medical IDs. In October 2018 the company was fined $16 million by the US Department of Health and Human Services for Health Insurance Portability and Accountability Act (HIPAA) violations. That fine was in addition to the $115 million the company had to pay out in 2017 to settle a class-action lawsuit relating to the breach.

1&1 Telecom: $10.6 million

It's not just the UK's ICO which is handing out large GDPR fines. German web hosting company 1&1 was fined €9.55 million ($10.6 million) by Germany's Federal Commissioner for Data Protection and Freedom of Information (BfDI) for not taking "sufficient technical and organizational measures" to prevent unauthorized persons using its customer service department to gain access to customer data. Its poor authentication processes meant that callers could obtain information on other customers by simply providing the name and birthdate of the person they wanted information on. 

Other large GDPR fines for non-breach related reasons include an €18 million fine against the Austrian postal service for processing the political affiliation of data subjects and €14.5 million against German property company Deutsche Wohnen for retaining customer data after it was no longer needed.

Google: $7.5 million

More normally associated with fines around monopolies and anti-trust, 2020 saw Google agree to pay $7.5 million to resolve a class-action lawsuit over two Google+ incidents. The search giant originally announced it planned to shut down its Google+ social network in October 2018 after revealing a bug in a Google+ API that allowed developers access to data marked as private. Though Google claimed there was no evidence this bug was exploited, it acknowledged that over 400 applications used this API and potentially affected over 500,000 accounts.

Two months later Google announced a second incident involving Google+ and was shutting down four months earlier than originally stated after another API issue gave developers access to private profile information on 52.5 million users. (Again, the company said it didn’t think there had been any exploitation of this bug.)

Two class actions suits were filed in 2018 but later consolidated into one, and January 2020 saw a settlement agreed that would allow all users with Google+ accounts between January 2015 and April 2, 2019, whose non-public information was exposed to receive between $5 and $12 each.

The University of Texas MD Anderson Cancer Center: $4.3 million

In June 2018 a judge upheld the decision to fine the University of Texas MD Anderson Cancer Center $4.3 million for HIPAA violations. The cancer center suffered three data breaches between 2012 and 2013, which resulted in the loss of health information ofover 33,500 individuals. In one case an unencrypted laptop was stolen from an employee’s residence. The other two breaches involved the loss of unencrypted USBs.

Fresenius Medical Care North America: $3.5 million

HIPAA failures strike again. In February 2018 Fresenius Medical Care North America (FMCNA) was slapped with a bill for $3.5 million after suffering five separate breaches at different company locations between February and July of 2012. An investigation by the Office for Civil Rights found FMCNA had failed to “conduct an accurate and thorough risk analysis of potential risks and vulnerabilities to the confidentiality, integrity, and availability of all of the health information it was storing across its different entities.”

These failures include not preventing unauthorized access to facilities and equipment, failing to encrypt health data, not governing the removal of electronic media holding health data, and having a lack of security incident procedures.

Cottage Health, Touchstone Medical Imaging, and University of Rochester Medical Center (URMC): $3 million each

2019 saw three large HIPAA violations; $3 million each for Cottage Health & Touchstone Medical Imaging.

Cottage health was fined for two breaches — one in 2013 and another in 2015 — resulting in electronic protected health information (ePHI) affecting over 62,500 individuals being leaked. Both incidents involved servers holding ePHI being accessible over the internet.

Tennessee-based Touchstone Medical Imaging was fined after leaving the protected health information (PHI) of over 300,000 patients available online through an exposed FTP server. Touchstone was notified about this exposure by the FBI in 2014 but claimed no patient PHI was exposed.

The US Department of Health and Human Services (HHS) found that Touchstone “did not thoroughly investigate the security incident until several months after notice of the breach from both the FBI and OCR.” In addition, the HHS said that notification to individuals affected by the breach was “untimely,” that Touchstone “failed to conduct an accurate and thorough risk analysis of potential risks,” and the company “failed to have business associate agreements in place with its vendors.”

In November 2019 The University of Rochester Medical Center (URMC) was also fined $3 million for failing to encrypt mobile devices. The center, which includes the School of Medicine and Dentistry and Strong Memorial Hospital, lost an unencrypted flash drive in 2013 and had an unencrypted laptop stolen in 2017. URMC was fined for failing to properly protect personal health information despite previously reporting a breach through an unencrypted drive in 2010.

Jackson Health System: $2.15 million

Another large HIPAA violation, this time for Miami nonprofit academic medical system Jackson Health System (JHS), which runs a number of hospitals and care centers in Florida. JHS was fined $2.15 million by DHS over several incidents between 2013 and 2016.

Although JHS did report the loss of paper records on 756 patients to DHS in 2013, it failed to report the loss of an additional three boxes of patient records after an internal investigation. In 2015 JHS discovered two employees had accessed a patient’s electronic medical record without a job-related purpose. In 2016 JHS reported a breach after finding that an employee had been selling patient data totaling 24,000 patients' records since 2011.

Equifax, Facebook, DSG Retail Limited, and Cathay Pacific: $650,000 each

Four companies in the UK can count themselves lucky. In 2018 the UK Information Commissioner’s Office fined Equifax and Facebook or data failures under the pre-GDPR Data Protection Act, in which the highest possible fine is just £500,000 (~$650,000). Under GDPR, the penalties could have been much higher. Facebook was slapped with the bill in October over the Cambridge Analytica data scandal, while Equifax was handed the maximum penalty in September for its 2017 breach.

In early 2020 – almost two years after the introduction of GDPR – the regulator fined two more companies under the old DPA. UK retailer DSG Retail Limited (DSG) received the fine after point-of-sale malware was discovered on over 5,000 machines at its Currys PC World and Dixons Travel stores. However, as the attack started in July 2017 -- before the implementation of GDPR – the company was fined the old maximum of £500,000 despite the fact the attackers were reportedly still collecting information until April 2018, after the implementation of the new regulations.

The attack enabled unauthorized access to 5.6 million payment card details and personal information of approximately 14 million people, including full names, postcodes, email addresses, and failed credit checks from internal servers. The ICO claimed the company had” poor security arrangements” and failed to take adequate steps to protect personal data, including inadequate patching, absence of a local firewall, lack of network segregation, and no routine security testing. The ICO had previously fined DSG’s Carphone Warehouse £400,000 [~$520,000] for similar failings in January 2018.

Chinese airline Cathay Pacific was fined the DPA maximum in March 2020 for "failing to protect the security of its customers’ personal data." The ICO ruled that between October 2014 and May 2018 Cathay Pacific’s systems "lacked appropriate security measures," leading to customers’ personal details being exposed.

Copyright © 2020 IDG Communications, Inc.

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