What is data theft and how to prevent it

FACT: The average cost of a data breach is USD 4.45 million.

FACT: 60% of small businesses that suffer a breach go out of business within six months.

Data theft can have detrimental consequences on your business.

In this post, we’ll cover what data theft is, why it matters, how it happens, and what you can do to prevent a breach.

Table of contents:

What Is Data Theft?

Data theft is the unauthorized access of sensitive information, often with the intention of using it for malicious purposes.

The following types of data are often targeted:

• personal details (e.g., names, addresses, and social security numbers)
• financial data (e.g., credit card numbers and bank account information)
• credentials (employee, customer, and vendor)
• intellectual property (e.g., source code and algorithms)
• customer and employee data
• trade secrets and internal company documents

Why data theft matters

Data theft matters for several reasons, as it can have a wide range of consequences for individuals, organizations, and society as a whole:

• Financial Impact: Data breaches often result in significant financial losses for organizations. This includes costs related to investigating the breach, legal fees, regulatory fines, and expenses for notifying affected individuals. Additionally, there can be indirect costs, such as loss of business and decreased revenue due to reputational damage.
• Reputational Damage: As mentioned before, a data breach can severely damage an organization’s reputation. Customers may lose trust in the organization’s ability to protect their data, leading to a loss of business and potentially long-term damage to the brand.
• Legal and Regulatory Consequences: Organizations are often subject to data protection regulations, such as the General Data Protection Regulation (GDPR) in the European Union or the California Consumer Privacy Act (CCPA) in the United States. Failure to comply with these regulations can result in significant fines and legal action.
• Operational Disruption: Responding to a data breach can be time-consuming and resource-intensive, leading to operational disruptions. Organizations often need to allocate significant resources to investigate the breach, implement security measures, and manage the fallout, which can divert attention from regular business activities.
• Loss of Intellectual Property: Data theft can result in the loss of intellectual property, such as trade secrets, proprietary information, and competitive advantages. This can have long-term implications for an organization’s competitiveness and market position.
• Impact on Stakeholders: Data breaches can affect not only the organization but also its employees, customers, partners, and investors. The loss of sensitive information can lead to identity theft, financial fraud, and other personal consequences for individuals, which can further erode trust in the organization.
• National Security Risks: In some cases, data theft can pose risks to national security, especially if it involves the theft of classified or sensitive government information.

How does data theft happen?

Attackers use various methods and techniques to gain unauthorized access to data. Some common ways in which data theft happens include:

1. Credential Stuffing: Malicious users exploit stolen usernames and passwords from one breach to gain access to accounts on other platforms, exploiting the fact that many people reuse passwords across multiple services.
2. Malware: Malicious software, such as stealer malware, viruses, ransomware, or spyware, are used to infect systems and steal data as well as credentials. Malware can be introduced through email attachments, infected websites, or removable media.
3. Vulnerabilities: Attackers exploit vulnerabilities in software to gain unauthorized access to data. This can include attacks such as SQL injection, cross-site scripting, or exploiting unpatched software vulnerabilities.
4. Phishing: Cybercriminals use deceptive emails, messages, or websites to trick their victims into revealing sensitive information, like passwords or financial details. Social engineering attacks often mimic legitimate messages from trusted sources.
5. Insider Threats: Employees or other insiders with legitimate access to an organization’s systems may intentionally or unintentionally leak or steal data. This can occur due to malicious intent, negligence, or social engineering.
6. Physical Theft: Data can be stolen through the physical theft of devices such as laptops, smartphones, external hard drives, or USB drives that contain sensitive information.
7. Third-Party Vendors: Attackers target third-party services or vendors that have access to your organization’s data. Supply chain attacksexploit weaknesses in vendors to gain unauthorized access to their systems and, by extension, the data of their clients.

Examples of data theft

Data breaches are constantly in the news. It’s an issue that affects both small businesses and large enterprises. Here are a few notable examples:

• Equifax (2017): The credit reporting agency Equifax experienced a massive data breach that exposed the personal information of approximately 147 million people. The breach included names, Social Security numbers, birth dates, addresses, and in some cases, driver’s license numbers.
• Yahoo (2013-2014): Yahoo disclosed two major data breaches that affected its users. The first breach, which occurred in 2013, impacted all 3 billion Yahoo accounts, while the second breach, in 2014, affected 500 million users. The stolen data included names, email addresses, phone numbers, birthdates, passwords, and security questions and answers.
• Target (2013): The retail giant Target suffered a data breach during the holiday shopping season, affecting 41 million customer payment card accounts and up to 70 million individuals' personal information, including names, addresses, phone numbers, and email addresses.
• Home Depot (2014): Home Depot experienced a data breach that affected 56 million credit and debit card numbers and 53 million email addresses. The breach occurred due to a malware attack on the company’s point-of-sale systems.

Tips for preventing data theft

There are a number of steps you can take to reduce the risk and impact of a data breach. While there’s no silver bullet, the following steps will help protect your sensitive data:

• Segment the network: Divide your network into segments to make it harder for an attacker to move laterally across the entire network and access sensitive information
• Access controls: Use role-based access controls (RBAC) to ensure employees only have access to the data and systems necessary for their roles.
• Enforce strong authentication: Implement multi-factor authentication (MFA) to ensure only authorized users can access sensitive data and systems. In addition, mandate the use of a password manager to generate and store strong passwords throughout the organization.
• Encryption: Encrypt sensitive data both at rest and in transit.
• Maintain an accurate asset inventory: Ensure you have a complete and updated list of all assets associated with your organization. You can’t patch what you don’t know exists.
• Regular Software Updates: Keep all systems and software up-to-date with the latest security patches.
• Endpoint Protection: Secure all endpoints (e.g., computers, mobile devices, personal devices) that access the company network with appropriate security measures to prevent unauthorized access and data leakage.
• Secure Configuration Management: Ensure that all systems (including cloud-based assets) are securely configured and regularly audited for compliance with security policies and standards.
• Employee Training: Educate employees about the importance of data security and common threats like phishing and social engineering. Regular training can help prevent accidental data leaks.
• Incident Response Plan: Have a well-defined incident response plan in place to quickly respond to and mitigate the impact of a data breach.
• Vendor Management: Assess the security practices of your third-party vendors to ensure they meet your organization’s security standards. Regularly monitor and audit their compliance.
• Physical Security: Implement physical security measures to prevent unauthorized access to premises and devices, such as locks, security cameras, and restricted access areas.
• Dark web monitoring: Continuously monitor the dark web for leaked employee or customer credentials and session tokens. Stolen credentials are often the easiest way for malicious users to gain initial access to their targets.

Need visibility into the dark web to find your leaked data? Book a demo to see how Breachsense enables security teams to identify and mitigate leaked data before it’s exploited.