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Costs of data breaches continue to rise

Published 19th June 2015

Regardless of the industry, a data breach is something that needs to be avoided at all costs. Whether it leads to private candidate information leaking into the public or significant amounts of revenue disappearing, businesses of all shapes and sizes need to understand the risks at play.

While a data breach can bring a lot of reputation damage, the financial cost can sometimes be a lot greater. This was the topic of a recently released study titled ‘2015 Cost of Data Breach Study’ from IBM and the Ponemon Institute.

The Ponemon Institute polled 350 businesses across 11 countries, including Australia, asking how significant their individual data breaches had been to the organisation. Spanning between 2,200 and 100,000 compromised records, the average cost of a data breach was estimated to be $3.79 million over the past two years. This is an increase of 23 per cent since 2013. 

Statistics from the report also show that the average cost per stolen record rose by six per cent, from $145 to $154 over the same period.

Types of data breaches

For recruitment businesses, it is important to remember that data breaches can come through various channels. As such, the study found 47 per cent of all breaches were caused by malicious or criminal attacks, 29 per cent were caused by system glitches and 25 per cent were attributed to human error.

Larry Ponemon, founder and chairman of the Ponemon Institute explained that there are three major influences on data breaches globally.

“First, cyber-attacks are increasing both in frequency and the cost it requires to resolve these security incidents. Second, the financial consequences of losing customers in the aftermath of a breach are having a greater impact on the cost,” he said in a May 27 media statement.

“Third, more companies are incurring higher costs in their forensic and investigative activities, assessments and crisis team management.”

How to avoid costly data breaches

Data breaches can strike at any time, but it is the mark of a professional organisation to put processes in place prior. If the system is built to secure data and information, businesses will be able to expand their customer base and become an industry-leader.

This is where Oncore Services can be of assistance. Our state-of-the-art payroll and invoicing system is crafted to protect the details of your IT contractors and ensure you pay them through trusted channels.