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Many Companies Underestimate Data Breach Threat

Most not prepared for the associated costs

Tuesday, November 20, 2012
Many Companies Underestimate Data Breach ThreatIn recent years, many businesses have learned the hard way that cutting corners on data security can end up costing them far more in the long run if they suffer a data breach, but the concept seems not to have sunk in yet for most companies.

While the majority of small businesses say that the chances of credit card or check fraud affecting their company is either "likely" or "very likely," it seems that most don't take cyber threats seriously enough, according to a survey from the Ponemon Institute. For instance, 64 percent of those polled said they thought the primary barrier to being more secure was a lack of people resources, while 62 percent identified regulatory complexity as the primary hurdle.

"Results indicate that companies tend to seriously underestimate the potential damage to brand and reputation, revealing a great data breach perception gap," said Larry Ponemon, founder and chairman of the Ponemon Institute. "Misconceptions about the consequences associated with a data breach are preventing organizations from implementing the necessary financial tools, in house-expertise and technologies to achieve cyber readiness."

Ondrej Krehel, chief information security officer for IDentity Theft 911, has a blog about data breaches.

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