Published 25 August 2022 12:00 AM
12 min. read

What Is a Data Breach and How to Prevent Data Leaks?

At a time when the digital industry is driving growth forward, the internet enters our lives in all possible ways. In the post-pandemic era, a growing number of companies promote their services and products through the web. Moreover, the majority of organizations, as well as individuals, store a significant amount of their data in the cloud. Whether users are online or offline, they may be under the threat of having their data compromised and stolen.

A data breach is a major threat that a government, business, or individual may face in the modern era. In this article, we will analyze the definition of a data breach, the reasons that can cause it, as well as how data breaches happen. Moreover, we will provide ways to prevent such incidents and explain how a business or a customer can face a data breach.

What Is a Data Breach?

In the digital world, a data breach is an incident that involves unauthorized access to and/or leaking of confidential data or sensitive and protected information. This can either happen accidentally from a user's side or deliberately as the result of a cyberattack. Usually, experienced hackers who specialize in cyber crimes are responsible for the majority of security breaches and information theft.

Those cybercriminals sometimes act as malicious insiders by gaining access to a user's data with a virus that can infect their personal computers. There are also more efficient ways that some talented hackers use to act as external attackers, exposing private information such as account numbers and banking codes, or even stealing someone's identity to take part in various fraudulent activities.

A data breach is a result of exploiting technological vulnerabilities or poor user behavior on the web. Most cyber threats take the form of spyware, phishing, or hacked access controls. Regardless of the type of cyberattack, data breaches are the result of the extensive use of the web and the constant increase in information that’s becoming available there.

Why Do Data Breaches Happen?

A data breach can be the result of an intentional cyberattack by an experienced hacker or an accidental act of the user. The constant transmission of sensitive data over the web has drawn the attention of cyber criminals, who intend either to use this information for their own interests or to sell it to others. One of the main reasons for such data leaks is poor security awareness.

Most of the time, a data breach can be traced back to an intentional act from an individual to take advantage of sensitive data. In the list below are some reasons that hide behind a data breach:

  • A malicious insider

A data breach from a malicious actor aims to expose the private information of an individual or company. A malicious insider can also be a trusted person who has access to the data but intends to use it in a nefarious way.

  • A malicious outsider

There are also occasions when a data breach is the result of a cyberattack carried out by experienced hackers who use different mechanisms to extract sensitive information from a network of organizations or individuals.

  • Card fraud

One of the most popular information leaks is through malicious e-mails, personal messages (SMSs), and special skimming devices. A skimmer can use the stolen data of a cardholder to proceed with unauthorized transactions and purchases.

A data breach can also be the result of an unintentional act of a user. Some examples include the following:

  • Loss of a device

Personal data can be stolen if a person loses his electronic device such as a laptop, smartphone, external hard drive, etc. If the device does not have a security code or the data is not encrypted, it is easy for attackers to gain access to the user's private information.

  • An accidental act of an employee

In big organizations, every employee has certain rights to the company’s information. Thus, if someone gains access to data that is not authorized, even if he does not have any intention of stealing it, that information is considered breached.

The Most Famous Data Leaks

Even though most of the biggest organizations, private or public, are aware of the dangers that a data breach can bring, cyberattack still happen and expose the personal data of the companies’ users. Listed below are some of the most infamous examples of malicious data breaches:

  • In May 2014, a major cyberattack took place on eBay where 150 million private records were stolen.
  • One of the biggest e-mail providers, Yahoo, became a victim of cyber-attackers between 2013 and 2014, losing 3 billion private records.
  • MySpace, a popular social media website, had a significant data breach, which resulted in the loss of around 360 million of its records.
  • In July 2014, a serious data breach shocked the financial world when one of the most important and popular investment banking firms, JP Morgan Chase, announced that its network had been breached. The bank claimed that 76 million of its consumer records had been stolen and another 7 million from small businesses. The damage was estimated at 83 million lost pieces of financial data of customers.
  • Dropbox, one of the most popular files sharing and hosting service providers was also a victim of a data breach in 2012. The company announced that around 65 million records were stolen.
  • In July 2019, a significant data breach took place at one of America’s largest bank holding companies, Capital One. The organization announced that approximately 106 million credit card holders were affected in Canada and the US. The attackers gained access to 140 thousand U.S. social security numbers, and 80 thousand linked bank account numbers.

Why Do Criminals Steal Data?

The main purpose of a cyberattack is to gain access to sensitive information from an organization or individual because the hacker believes that some of those compromised data may have significant value. Most criminals perform extensive research on the victim’s vulnerabilities and usually follow a specific pattern to take advantage of the weak points. A data breach may take up to five months to be detected, leading to an extensive data leak.

The personal data that is extracted with a data breach is used for two main reasons:

  • Personal use of the cybercriminal

Depending on the importance and the nature of the information that is stolen, hackers may use it for their benefit. Thus, if a cybercriminal has stolen the bank codes or credentials of a cardholder, he may use them to issue a new card under the victim's name. As a result, the criminal can proceed to make unauthorized purchases and high cash withdrawals, or even take out health insurance and get expensive medical treatment.

  • High-value information can be sold through the dark web

A data breach of an important and powerful organization can give cybercriminals access to high-value information, such as social security numbers, bank accounts, credit card numbers, etc. This data can be sold on the dark web for a considerable amount of money.

What Methods Are Used to Breach Data?

Black hat hackers use different methods to break the security walls of a network and exploit its vulnerabilities. They usually concentrate on quick profit from governments, organizations, and individuals. Listed below are some of the methods that a cybercriminal may use to take advantage of a network weakness and steal sensitive information.

  • One of the most popular techniques is by leveraging commonly used or easy-to-break passwords. Most people tend to keep the passwords that were there by default on their devices. They usually consist of a specific pattern that makes them easy to breach.
  • Hackers usually take advantage of popular applications or commonly used devices, turning them into malicious entities that are detrimental to users and exploit the vulnerabilities of their systems.
  • A popular reason for data breaches is malware. Cybercriminals can develop, buy, or even rent such malicious software to infiltrate networks or computer systems and exploit data. The most common way a virus can infect a user’s system is through an e-mail containing a link, fake lotteries, online ads, etc.
  • A social engineering attack is another method that cybercriminals use to harvest sensitive data from secure business or private networks. This method includes different types of psychological manipulation by scammers and fraudsters to gain access to a safe network, bypassing any kind of security measures.

What Is the Target of the Data Leak?

In a cyberattack, hackers usually aim to exploit vulnerabilities and weaknesses of a network or a computer system. A data breach is the result of low or no security measures, which may compromise the user's data. One of the most common reasons for data leaks is connected with brute force attacks that aim to steal users’ credentials. This is because a vast majority of people use simple and easy-to-break usernames and password combinations.

Another reason for data leaks is stolen credentials. It is very common for hackers to use phishing attack techniques to harvest personal information and utilize them for unauthorized actions or sell them to malicious third parties. Moreover, most organizations use low to medium security software, making them vulnerable to malware attacks that can easily bypass the majority of authentication steps.

What’s more, a data breach can occur due to a lack of network security awareness. Nowadays, people should pay more attention when they make transactions and purchases online since there are insecure web pages that may be exploited by third parties. The goal of such criminals is to steal sensitive information such as bank accounts and card information.

What Are the Risks of Data Breach?

Depending on if a data breach happens to governmental organizations, businesses, or individuals, the level of risk varies accordingly. An information leak can have serious consequences for the reputation or the finances of a victim. Moreover, depending on the importance of the data that was stolen, the risk can be from insignificant to extremely high.

If there is a serious data leak in a government organization, the level of risk and the significance of the consequences is high. Stolen data that concerns health care issues, classified military information, financial reports, and crucial political dealings, are kinds of data that are essential for national security and defense. Thus, the risks of a potential data leak from governmental institutions are very high and may have a great impact on national infrastructure.

A data breach may have a dramatic impact on a business organization’s reputation and economic state. Depending on the nature of the company, a potential loss of its clients’ sensitive information may lead to a loss of their trust in the company. Thus, the risk of losing clients or even facing bankruptcy can be high and devastating.

Furthermore, there are serious risks from a data breach to individuals’ personal networks or computer systems. Hackers can use the stolen data for identity theft to proceed with illegal acts, such as issuing a credit card with the identity of the victim, taking advantage of social security numbers, etc. More information about the dangers of a data breach can be found in the following video:

How to Prevent a Data Breach

There are many steps businesses can take to prevent data breach attacks or leaks. For example, encrypting data is an important step, but if employees are not properly trained in how to use encryption tools, the data is still at risk. Thus, employee education is critical. In addition, companies should have strong password manager policies in place and make use of multifactor authentication whenever possible. Firewalls and intrusion detection systems can also help to prevent unauthorized access to a company network. By taking these and other steps, businesses can help to protect their data and reduce the risk of a costly breach.

As more and more of our lives move online, it is becoming increasingly important to protect our personal information. While large companies have a responsibility to safeguard our data, there are also things that we can do as individuals to reduce the risk of a data breach. One of the most important things we can do is to be aware of the risks. Phishing scams, for example, are becoming more and more common, and they can be very sophisticated. Be careful about opening emails or clicking on links from unknown senders, even if they look legitimate.

Another thing you can do is to use strong encrypted passwords and never reuse the same ones across multiple accounts. Hackers can sometimes gain access to one account and then use that information to break into other accounts. Finally, you should keep an eye on your credit report and watch for any strange activity. If you see something that doesn't look right, it could be a sign that your personal information has been compromised. By taking these simple steps, you can help to protect yourself from a potentially devastating data breach. If you want to learn more about data breach prevention, you can check the following video:

Best Practices for Businesses

Infosec teams that consist of tech and cybersecurity researchers are continuously trying to find effective ways to secure businesses against any type of cyber threat. Some steps that a business can follow to secure against data breaches are:

  • Encrypt all sensitive data.
  • Limit the access control to employees, ensuring that everyone has the exact amount of access to do their job.
  • Deploy efficient web security solutions using a web application firewall (WAF).
  • Use network security applications such as firewalls, DDoS protection, data loss prevention (DLP), etc.
  • Keep both the security software and hardware updated.
  • Train and educate your employees on cybersecurity issues.

Best Practices for Customers

Not only big companies and organizations should try to find ways to prevent a data breach, but also individuals. Here are some of the most important steps that a consumer should follow:

  • Implement a unique password on each electronic device.
  • Use multifactor authentication to secure the most sensitive information.
  • Insert personal data and bank information only on HTTPS websites, since they are considered safe.
  • Always try to keep software and hardware updated.
  • Avoid installing applications or opening shared files that may contain suspicious contents and are not from reputable sources.
  • Use high encryption to secure any information on hard drives and prevent an attacker from reading the stored files.

Conclusion

A data breach is a security event that results in unauthorized access to protected data. Data breaches can occur through a variety of means, including hacking, malware, phishing, and user error.

The consequences of a data leak can be devastating for both organizations and individual users. Thus, it’s important to take precautionary steps to eliminate such situations, or, if a data breach has already occurred, take measures to contain the leak and minimize further damage. For businesses, this may involve deploying advanced software solutions, encrypting information, implementing new security measures, etc. For individuals, steps to protect personal information may include changing passwords and monitoring credit reports for suspicious activity. Only by taking proper precautions can both businesses and individuals protect themselves from the potentially damaging effects of data breaches.

FAQ

What does a breach of data mean?

A data breach is an act of accessing the sensitive, confidential, or private information of an organization or individual. It is an incident where the victim may face great financial damage, and it may be harmful to a company's reputation and the trust of its customers.

What are the 3 types of data breaches?

A data breach can be done through various means, but there are three primary types of data breaches: external, internal, and accidental. An external breach is initiated from outside the company, and an internal breach occurs when an employee or contractor with authorized access to the system misuses their privileges. Finally, an accidental data breach can occur when an employee inadvertently discloses sensitive information.

How can data breaches be prevented?

There are several steps someone can take to prevent data breaches. Encrypting sensitive data is an effective tool when combined with limiting access to only those who need to see it. Additionally, it is important to keep your security software up to date. Finally, make a regular backup of your data so that even if a breach does occur, you will not lose all your information.

What is data breach risk?

Causing a data breach can have serious consequences for individuals and businesses alike. Individuals may suffer financial loss or identity theft, while businesses may face damage to their reputation and legal liability. To protect against data breaches, companies should implement security measures such as firewalls, password protection, and encryption.

Why is it important to avoid data breaches?

It is important to avoid a data breach since sensitive information such as social security numbers or credit card numbers may fall into the wrong hands. Moreover, it can be used to steal someone's identity, leading to financial problems. Data breaches can also damage a company's reputation and result in the loss of customers. Thus, both individuals and businesses need to take steps to protect themselves from data breaches.

How do hackers steal data?

One common tactic is known as phishing, in which cyber criminals send emails that appear to come from a legitimate source. Another common technique is SQL injection, in which hackers insert malicious code into web forms to gain access to sensitive data. Hackers also use different types of malware to infect computers and devices, allowing them to remotely access and control the systems.

How does data get leaked?

There are many ways that data may get leaked. For example, an employee may accidentally leave a USB drive containing sensitive information in a public place. Or, a hacker may gain access to a company's computer system by using stolen passwords or other personal information. By taking precautions, companies and individuals can help to protect their most valuable asset: their data.