How to Handle the Legal Implications of a Data Breach Effectively

Under GDPR, businesses must know how to respond to a security breach involving personal data.

As the processing of personal data becomes more commonplace, the number of opportunities for data breaches grow.

Incidents of this kind are likely to have significant consequences for businesses. The average cost of a data breach is rising each year, with UK companies alone having experienced a 10.56% leap since 2014.

This amount now stands at £2.99 million on average. This is just one of the reasons why it is vital for companies to know how to respond to a security breach correctly and protect your business and sensitive information.

General Data Protection Regulation (GDPR) states that companies must follow strict data breach policies and procedures when it comes to personal information.

The loss of privacy data has implications that may seriously damage your business long term. Not only will your reputation be at risk, but you will face significant legal challenges from which you may not recover.

For advice on valuable data breach and cyber security incidents, contact the solicitors at Nolan Whitehurst.

Four steps you can take to handle the implications of a data breach effectively

1. Provide information to the relevant parties

Data security auditing is handled by the ICO (Information Commissioner’s Office), as is the regulation of adherence to GDPR.

This body is among the first you should inform of any data breach occurences. You must also inform the subjects of the compromised data.

Depending on the circumstances, it’s likely that you’ll also need to inform:

Your insurersOther companies to which the data relatesThe police

You must report the breach to the right people within 72 hours to follow data protection law.

2. Plan and carry out a response

The results of a breach can vary in severity. You must swiftly and effectively assess the damage that this breach is likely to cause. You should then take steps to reduce it if possible.

These steps may range from changing all staff passwords to preventing access to the entire system until the source of the breach is isolated and fixed.

You should also arrange a means by which to communicate with and respond to queries from:

The subjects of the compromised dataYour partners and contractorsThe pressInsurersThe ICOThe police

It may be necessary to make a public statement detailing what occurred and what you are doing to put it right.

You will also need to prepare for an investigation by the ICO and the police.

3. Analyse the incident and plan for the future

Once the incident is under control and you have reported the matter to the correct bodies, you must undertake a review.

Identify areas in which your procedures and security methods may have been insufficient. Discuss how this may have made the breach possible, and how it can be improved to prevent another cyber attack of this kind.

Draw up new policies and, where necessary, arrange for staff training to fix gaps in your security. Test these new approaches rigorously where you can.

We recommend that you seek specialist legal advice before beginning this process. Expert GDPR solicitors will be able to audit your current practices and help you to revise your procedures in the most effective manner.

4. Respond to legal action or investigations from regulatory bodies

Most data breaches have legal consequences. If your company has fallen victim to a breach, it is likely that you will face investigation by the ICO and even the police. They will seek to determine what caused the breach, the identities of the perpetrators and your level of liability.

You may also face litigation from regulatory bodies, from customers and clients or from business partners.

You must be able to prove that you had implemented all necessary security measures steps under GDPR. If your policies and procedures are deemed inadequate, you may face penalties.

For a minor data breach, fines may extend to €10 million or 2% of your company’s annual turnover (whichever is larger). More significant breaches may result in penalties of €20 million or 4% of your turnover.

At this stage, your business may not only suffer in a financial sense but also in terms of reputation. For this reason, we recommend that you seek quality legal representation.

Good data protection solicitors can help to build a strong legal defence and argue that you should not be held liable for a breach.

They may also be able to commute any sentence or penalty by proving that you had sufficient protection in place, or that you have made significant progress since the incident.

How to prevent security breaches

One of the best ways to ensure your company can handle a breach is by having solid security processes in place from the beginning.

You can do this by:

Providing all staff members with full data protection training and instruction
Informing all stakeholders and customers of your approach to GDPR and identity theft
Ensuring that you have proper consents for the processing of data
Protecting your systems with sophisticated cybersecurity software
Developing a comprehensive set of documents and policies to safeguard against data breaches.

GDPR documentation may include:

Detailed privacy notices to share with stakeholders or when asking for data subject consent
tA full GDPR compliant data processing agreement
Secure records of consent
Comprehensive data controller-data processor contracts
Data protection and retention policies
A step by step GDPR breach notification procedure

Remember, private data doesn’t need to reach the public sphere for a breach to have occurred. Something as simple as unauthorised access qualifies as a failure to follow GDPR regulations and may see you prosecuted.

Developing a comprehensive set of documents and policies will help you to ensure that data is only handled and shared by those with the correct authority, under the right circumstances.

The GDPR solicitors at Nolan Whitehurst can help you to develop all the material you need to comply with GDPR.

Data breaches can have serious consequences. If your company falls victim to one, you must:

Report the breach to the ICO and other relevant parties within 72 hours
Investigate the details and respond accordingly, in a timely manner
Perform a full analysis and work to improve your policies and security to avoid future breachesPrepare for the consequences and seek legal support

Nolan Whitehurst can help you to develop watertight policies and documentation to help prevent a breach. We can also assist you in responding to a breach and represent you throughout any investigation or matter of litigation that may follow.