Data Theft - Once you know, it’s too late!

We have progressed to a near fully digital work environment. Any employee with some computer knowhow has the potential to find themselves in a folder they should not be in and taking information out of it.

The reality is, even if you have a sophisticated security, monitoring and tracking system in place across all the computers and mobile devices in your business, you are unlikely to be able to prevent an employee, partner, consultant, or contractor stealing your data.

Big companies spend hundreds of millions of dollars to protect their data and they can’t even stop it. Job function more often than not requires you to provide access and even limited access won't stop a determined thief. So there’s little chance that SMEs will have the resources or access to knowledge about what they can realistically do.

So, the real issue in relation to data theft is to do the best you can to make it harder for someone to steal your data because you are unlikely to find out until it’s too late. And less than a minute after an event is too late. Data can be copied by an employee and gone from your business in literally seconds.

Some examples of data theft
A top sales person could take all your business leads and customer contact details to use when they commence work for another company. You might not find out about this until some of your existing customers don't renew their spend with you or when a good customer calls to let you know an ex-employee is trying to win their business.

An agent in your real estate business make take client and or rent roll information and the like and either set up on their own or, more likely move to a competitor.

A doctor or other health professional in your medical practice, who requires access to patient files as a part of their job function in fact by law has to have access, could copy all the information in the patient files, leave your practice and take your patients with them. When would you know? When he doesn't turn up for work the next day to see a waiting room full of patients? Or will it be a patient contacting your office about a change of address text or email they received 5 minutes after the doctor left your center after days work.

The value of Patients contact information is often underestimated. To an identity thief it is the most valuable of all personal data. Contractors and employees have walked away with their employers patient data just before their months pay was to hit their bank account. Why wouldn't they wait until they got paid before stealing the data? Because an opportunity to steal and leave with a valuable customer list presented itself and was worth risking not getting their pay.

A common response from all the above is that it’s illegal, the information is the company’s/firm/practice. Firstly its not illegal in Australia for an employee to steal data and do you really think the person stealing the information cares? In fact they probably feel entitled to some if not all of it.

In for a penny in for a pound
In a recent case a Chiropractor not only stole the contact information of patients he had treated he stole all of his work mates patient contact information as well, 10's of thousands of patients were effected. This ethically challenged individual provided a hacker with his login to get past the levels of security that had prevented him being able to even see let alone copy patients contact details. Now this would have to be illegal! You think! In Australia even this act of fraud is not illegal. How long had he worked for his employer? Over 12 years.

Ah, people say, we have non-compete clauses and other restrictive covenants and we can sue the person for theft, our clients/patients/customers would not leave. Guess what? Have you ever tried pursuing someone through the courts in relation to a breach of confidence, non-compete clause or theft? I have. It costs 10's of thousands just to launch an action and you won't get any change out of another hundred thousand dollars (very likely more) to run a case that may take between 1 and 4 years to get through the court process and then the outcome is not at all certain.

And guess what? The thief can ask the courts for you to provide surety over their costs and damages. In many cases and particularly in the health industry the theft of customer data has already affected your cash flow, you are not covering your business expenses and now you are having to fund a protracted court action. You can stop the thief using your data immediately with an injunction the lawyers will say. You can of if you've got a lazy $80k lying around. Add at least another $50k for surety over the thief's costs. This is big end of town stuff, small business cannot possibly afford these types of actions.

Meanwhile, under a new privacy amendment introduced in 2014 you as the business owner could also be liable for a hefty fine from the Privacy Commissioner and soon it may also be compulsory to notify every one effected by the theft, a huge resource taxing task on its own. The employee who stole the data in the first instance is not covered by the amendment or any other part of the Privacy Act. Yep, that's right they get away scot-free. You can blame ex Labor minister Ms Nicola Roxon and her bureaucrats for that added kick in the guts.

In an earlier post I described what happens when you notify your customers their personal data has been compromised. Your phones will run off the hook with customers ringing to see what information the thief got and most of the callers will be abusive because to them it was the company that didn't protect their information. Its a fickle world out there in consumer land. Many customers will follow the theif and many others will leave because you have bad security. If you couldn’t keep their records safe the first time round why should they trust you.

On top of all this if your business has been the victim of data theft you are also now facing another reality, particularly if you öwn a medical practice, "copy cat theft". I will cover this in a future post.

There are some things you can do to minimise the risks through employee contracts and your privacy "agreement" with customers. There are also things you can do using off the shelf security products and monitoring staff behaviour. I'll also be covering some these in future posts.

Experienced data theft in your business? Send us Your Story.

Who is a Data Thief?

So who’s the thief? Well the bad news is that it could be anyone and they certainly won’t be wearing dark glasses, a hoodie and sloping around your office – although some of your current employees may dress like this.

A data thief is anyone. Your business partner, senior executive team member, employee, tech-support person, contract sales person, a locum, the employed or contracted health care professional, the admin manager, cleaner, yes even the cleaner ‘could have dunnit.’ Anyone with authorised and unauthorised access to your computer system could steal information from it.

Unauthorised access? In a data theft case in 2010 a Sydney massage therapist used the receptionists login to download the medical centres patient list to a disc after she had asked him to watch the front desk while she went to the the bathroom. He had worked at the centre for over 6 years and was highly regarded by his peers. He used the stolen patient information to start a massage therapy practice less than 75 metres from his employer. He was reported to Police and the ATMS. Nothing came of those reports because he had authorised access to "the premises".

Data Thieves only need the desire, some knowledge of the systems, most times the password/s (many people still use the word ‘password’ as their password), the opportunity and the time to plan their move. In a very recent case a graduate Osteopath, contracted as a locum, collected business cards or mobile phone numbers from the medical centres patients. After compiling a large list he used it to secure a position with a competitor and then contacted the patients in a series of change of address txts. Two days after sending out the txts he resigned from his former employer. According to a Judge in the Supreme Court this behaviour is acceptable and found in the Osteopaths favour.

The reality is, there is such a thing as a typical data thief and some common traits that can provide some, and I mean some, insight to who might be a data thief.

Research shows that a data thief will usually feel entitled to the information and are disgruntled for some reason. They might feel entitled because they helped to create it, therefore they have some ownership of it or entitlement because other people in the company are doing it, or because they know the company won’t be able to find out it was them or even if they did won't have the financial means to go after them.

They also might have ambitions of their own. They might want to start their own business, in which case planning the data theft probably started weeks or even months before they walked out the door. De-risking a start-up is one of the most common reasons for data theft particularly by healthcare professionals. It takes many years, a huge investment in cash and resources to build a medical practice to the critical mass required to be profitable.

Stealing the patient list and sending a change of address series of emails and txt's is a very quick way of ensuring the data thief will have patients when they open the doors of their new practice. Most patients will just think the emails and txt's are a courtesy to inform them the practitioner they have been seeing has moved to a new location and will not be aware of the restrictive covenants covered by most healthcare professional employment and sub-contractor agreements.

The ‘typical data thief’, will most likely be a current employee, male, in their mid 30s and requires access to meet their job-function. Interestingly, in 75% of reported cases, the data thief had authorised access to the data – so you can forget trying to report them to Police or any other authority.

This last point is where the cleaner comes in. If the cleaner has authorised access to the floor/office your computers are in and steals data only from those computers you’ll be hard pressed getting Police or any other authority involved because he had authorised access to the premises. Perhaps this is where the true meaning of the phrase, ‘being taken to the cleaners’ comes from.

Data Theft - Some Facts

One of the really interesting things about data theft is that it largely goes unreported. What company in their right mind would want to publicise that their customer data has been stolen? How would you feel if your GP called (as they will have to soon do under Australian law) to let you know that all your medical and contact information had been stolen? Not very good.

In fact when we notified effected patients their information had been compromised by ex-employees our reception staff received hundreds of abusive phone calls (and txt's) in the weeks following the theft. Under the guidelines of the OAIC we notified patients within 2 hours of the theft. All the notification did was drive patients away from the medical centre.

These employee data thieves provided their login to a hacker to access and steal sensitive patient information, however, as far as patients were concerned, we had let them down. Reporting the data theft and those responsible to Police, OAIC, APHRA and the HCCC was an absolute waste of time. They did nothing except respond that it was a "commercial matter" and would need to be sorted out in the civil courts. A recent civil case took over three years to get to a hearing in the Supreme Court and over 14 months to get judgement. Civil courts is not a solution nor is it a deterrent that will stop insiders stealing your customer lists or IP.

Getting stats about data theft is quite hard, and there’s hardly any for Australia. But there is some information and it’s pretty shocking.

It is estimated that data theft costs $250 billion in the USA.

• 14% of breaches were perpetrated by insiders with 7% involving multiple parties
• 20% of data theft hit information and professional services firms
• 50% of companies surveyed by the Carnegie Mellon Software Engineering Institute experienced at least one data breech by an insider in the previous year.
• 59% of employees who quit or leave admitted to taking confidential or sensitive information
• 62% of employees think it’s acceptable to transfer corporate data to their PCs, tablets, smartphone or cloud sharing application without seeking approval.
• 90% of IT employees indicated that they would take sensitive data if they were fired.

Now I don’t mean to disparage IT employees specifically or employees generally but the facts are clear. Data theft is rife and it’s happening across all businesses at much higher rates than anyone is really aware because it’s so hard to find the information. Verizon releases a data breach investigations report annually, as do a range of other institutions and organisations.

So, don’t kid yourself that it’s not happening much, or not happening much in your business sector, or to your type of business. The simple fact is, that it is and you need to understand it in order to minimise your risk.

There are some pointers on my website to some of the basic things you can do to minimise your risk so have a look.

If its happened to you, send us your story.

APHRA | HCCC | OAIC