Data leaks: What they are, and why they matter

What is a data leak?

A data leak refers to when sensitive information is exposed to those who shouldn’t be able to access it. An information leak like this can lead to personal data landing in the hands of cybercriminals. Threat actors can then use that information to threaten your company with extortion, launch phishing attacks, and commit several other crimes.

But what’s the difference between a data leak and a data breach? The terms are often used interchangeably, but if you’re going to protect data from cybercriminals, it’s important to understand what each term means.

Data leak vs. data breach

A data leak is when sensitive data exposure comes from an internal source, while a data breach is a cyberattack that comes from outside the organization. One way to remember this is that leaks come from the inside and move outward, and breaches come from the outside and then move inward. Data leaks are also usually accidental, whereas data breaches are intentional, malicious attacks.

In this article, we’ll be discussing how to prevent data leaks, not data breaches.

How do data leaks happen?

Data leaks can happen in several ways. Here are some of the most common methods:

• Technological weaknesses. Sensitive data can be exposed online due to an improperly configured network infrastructure with the wrong settings. Software vulnerabilities can allow cybercriminals to access personal data.
• Human error. Human error is responsible for a large number of data leaks. Policy violations like weak passwords, improperly handling confidential information, accidentally downloading malware, and falling for social engineering scams can all lead to unintentional exposure of sensitive data.
• Old data. Over time, companies can lose track of data like customer lists. Sometimes, infrastructure changes expose old data that an unauthorized person can swoop in and profit from. 

Why data leaks matter

A data leak is not merely some tiny annoyance you can ignore. It’s a serious problem that you should work to prevent rather than waiting for one to come to you. Here are some of the potential consequences of data leaks:

• Financial loss. Data leaks can cost affected businesses millions of dollars. Apart from funds stolen directly from company bank accounts by malicious actors, legal fees from resulting lawsuits and regulatory compliance fines may also arise.
• Reputation damage. A data leak is a disaster for your company’s reputation. Your current and potential customers will be wary of trusting your company with their confidential information in the future. Reputation damage can also occur when an individual’s compromising data is leaked online.
• Identity theft. When hackers have personal information like your login credentials and bank account numbers, they can commit identity theft. They can open various accounts in your name, make fraudulent purchases, and access medical services. In a data leak, employees and customers can suffer identity theft.
• National security risks. When information leaks in a military or government agency, military strategies, and intelligence reports can be made public. It could reveal details about our country's defense vulnerabilities and put national security at risk.

What information do cybercriminals target in data leaks?

To defend yourself and your company, awareness of the types of information cybercriminals look for is key.

• Personally identifiable information (PII). PII includes data like social security numbers, home addresses, phone numbers, and email addresses. Basically, any bit of information that can be traced back to a person’s identity qualifies as PII. Cybercriminals use this type of information to commit identity theft.
• Financial information. Financial information includes credit card numbers, bank account information, and other financial data. Hackers use this kind of information to steal funds directly from personal and corporate accounts or use it to start new accounts in your name.
• Health information. In data leaks, cybercriminals also target health information. This includes health insurance data, medical records, and personal information. Hackers can use this type of information to get free medical services using your name and extort individuals by threatening to release sensitive medical data.
• Credentials. Hackers target login credentials like email account usernames and passwords to gain access to a company’s network or system. After this kind of leak, cybercriminals can open online accounts, access a company’s cloud storage, steal money, and commit other crimes.
• Intellectual property. Intellectual property refers to sensitive information like trade secrets, designs, and confidential business plans. When information like this is made public, companies often have to change their plans

What are the common data leak examples?

Now, it’s time to tackle some real-life examples of how a data leak might occur. Here are some common scenarios:

• Lost devices. Now that so many employees at least partially work from home, they often carry their work laptops, mobile phones, and other devices with them. It’s risky to allow this since confidential data could be exposed if an employee does something like leave their laptop at a coffee shop.
• Poor password policies. Due to how difficult it is to remember passwords, employees often have their passwords written on Post-its or use the same password for multiple accounts.
• Outdated software. Companies can often be lax about encouraging employees to consistently update their outdated systems. Software updates often correct security vulnerabilities, so not updating them puts you and your company at risk.

How to prevent data leaks

You may be concerned about data leaks at this point, but you can take many proactive measures to prevent them.

• Strong password policies. It is essential that every employee has strong passwords. Using capital letters, numbers, and special characters will help to strengthen them. Multi-factor authentication (MFA) can also add an extra layer of protection to your accounts.
• Regular security audits. Regular security audits identify potential vulnerabilities and weaknesses in an organization. It is a proactive way to address potential data leaks before cybercriminals can exploit them.
• Employee training. In employee training, a security team trains employees in security policies to prepare them for the possibility of a data leak. The team can field security questions from employees so they’re properly informed. They can also formulate a recovery plan if a leak does occur.
• Data encryption. Data encryption involves transforming sensitive data into an unreadable format that only a decryption key can access.
• Firewalls. Firewalls monitor and filter network traffic, allowing only authorized users to connect and blocking suspicious activity that could lead to data leaks.
• Incident response plan. An incident response plan outlines a course of action for employees to take in case of a data breach or link, preparing them how to respond.
• Regular software updates. An unpatched infrastructure is a common way data leaks occur. Make it a policy in your company to install each new software update immediately. Lengthy updates may slow work down for a bit, but they’re worth it in the long run.
• Network security. A network security system helps organizations to effectively prevent, detect, and deal with data leaks. It uses various security measures to stop cybercriminals from gaining unauthorized access, committing data theft, and causing financial, operational, or reputational damage.

Data leaks are a real threat, but you can defend against them. Cybersecurity awareness is crucial, and by using the knowledge and tools from this article, you can help prevent data leakage from happening at your company.

If you’re still apprehensive, you could use a data leak checker. A data leak checker will scan online databases to see if your personal details have been exposed in a data leak or breach. For extra peace of mind, NordVPN offers Dark Web Monitor, which continuously scans the dark web for any of your personal information and alerts you if it’s found.