MANAGING RISK: Tech Takeovers
Information breaches and identity theft can pose a serious problem for dealers.
BY ANDY CARLO
Target recently acknowledged that it ignored last year’s security alerts pointing to a data breach. By ignoring the red flags, Target suffered one of the largest debit and credit card information thefts when more than 100 million of its customers’ data was compromised smack in the middle of the holiday shopping season— and just weeks before Christmas.
The Minneapolis-based mega retailer said it spent as much as $61 million in the fourth quarter of 2013 purely on the data breach. Target executives have also said they expect those charges to continue to escalate.
News of the breach left many shaking their heads and raising their eyebrows— particularly when Target already had a $1.6 billion security system in place designed for identifying hacking and cyber attacks.
Chances are, if you’re reading this story right now, you’re a dealer with a system that cost nowhere near the price of Target’s system and any type of mass hacking or identity theft scam could place your business on the brink of disaster.
Data compromise and identity theft are two threats that keep dealers awake at night, according to Jack West, national account executive at Federated Insurance.
When data is breached at a business, it can lead to damages in reputation, lost productivity and capital spent investigating the damage while alerting customers impacted by the breach.
“Information can be stolen inside the corporation and outside the corporation,” West says.