Today’s modern world is, undoubtedly, not a safe haven for any business. Make no mistake, even running a small-time operation or setting up a niche venture can become challenging. But surprisingly enough, the major brands like Sony or top cryptocurrency exchanges such as Binance aren’t under the greatest threat - criminals and hackers mostly see their prey under a much lower grade. Network security is one of the stumbling stones for businesses of any scale nowadays. Digital age fraudsters rarely engage in assaulting the top corporations - the largest chunk of their bounty comes from the companies that would never make it to the Forbes list.
A specific strategy of countering the possible threats in the digital arena must be designed, implemented, and followed through with on a constant basis. It is vital for business owners and their employees to be active when it comes to preventing cyber breaches.
Why your business is not secure
And this is certainly not a question. The latest study completed by Small Business Trends (SBT) indicated that almost half of the total of all cyber attacks (43%) targeted small businesses. So what’s the catch? Criminals follow a specific strategy and often attack smaller companies, since they rarely invest in a proper digital protection software or lack of efficient tools set up. In case something unusual happens and your business will be disrupted, insurance will only save you from bankruptcy.
More research data suggests that 60% of such companies go out of business for good within just six months after a cyberattack took place. The fact is, 48% of data security breaches are performed with malicious intent. Moreover, half of the companies have experienced a cyberattack involving customer and employee information being stolen in the past 12 months. In the aftermath of such incidents, these companies spent an average of $879,582 because of the damage or theft of IT assets. In addition, disruption to normal operations accounted for an average of $955,429.
Digital hackers and criminals can damage your brand in many ways:
- Snatch valuable information, such as financial data and social security numbers
- Acquire access over email addresses, bank account data, and personal information to target particular people
- Take over a user’s present accounts or even open up new ones in order to succeed in making fraudulent charges
- Perform phishing operations to lure our valuable data
- Tricky and experienced criminals use human-factor flaws to their advantage. Most people are prone to fictitious, obsolete operating browsers and social-engineering scams.
Data breaches statistics & history
With the increasing use and reliance on digital data by many corporations and small-time companies, data breaches have become fairly common in the past decade. The statistics speak louder than words - following the Statista data on the biggest online data breaches worldwide as of May 2019, the number of data breaches in the U.S. increased from 157 million in 2005 to 781 million in 2015, while the number of exposed records jumped from around 67 million to 169 million during the same time frame!
Meanwhile, Identity theft is the most common type of data breach incident in the world. A few years ago, identity theft accounted for more than 50% of all global data breaches, and about 40% of all compromised records that year. The services sector had the highest number of identities exposed that year – nearly 260 million. This figure accounted for just over 60% of all identities that were exposed through data breaches in 2015.
The financial sector is also highly affected by cybercrimes: financial access data theft is the second most common type of data breach, accounting for 22% of all data breaches. In 2015, this sector had a total of 120 million identities exposed. The costs of cybercrimes are rather high for the financial services sector.
Global cyber crimes caused, on average, an annual loss of 13.5 million USD for the financial services industry, the highest average amongst all industries.
Famous data breaches
In 2011, Sony's PlayStation Network and Qriocity music service were attacked by hacking collective Lulzsec. The PSN was offline for more than 43 days, and 77 million user data records were stolen
In August 2016, a 2014 hack of online platform Yahoo was uncovered, affecting at least 500 million user accounts
In December 2016, Yahoo revealed another hack dating back to 2013, which affected 1 billion users. The impact of the second reported Yahoo hack was updated in October 2017, when the company revealed that 3 billion accounts had been affected, making it the largest data breach in history.
Outracing the thieves
As we have seen, due to ongoing insights, small businesses are heavily unprotected. One has to put a well-designed plan in place in order to manage the data breach possibility. Ensuring a step-by-step strategy for small and medium businesses is the key to survival in the ocean full of cyber sharks.
Some steps you can take are:
- Update all operating systems regularly
- Purchase and utilize professional firewall software that will hold viruses, spyware, and phishing attacks at bay
- Encrypt your wireless network
- Set up restrictions and administrative rights to ensure that nothing can be installed on company computers without proper authorization
- Block access to restricted websites to prevent employees and hackers from uploading data to storage clouds
- Remove or disable USB ports to prevent malicious data from being downloaded
- Implement strict password policies
- Encrypt everything that contains sensitive data - drives, folders, and files
- Use the specific software from reliable KYC providers when working with digital assets
- Business owners should consult and hire security professionals
A digital shield for your business
Organized cyber crime can render significant damage to your business. However, it is not only imperative to attempt preventing a cyber breach, but to ensure that whenever such a thing happens, your company becomes aware of it on short notice. When it comes to your organization’s security, time is absolutely of the essence.
By utilizing specific KYC procedures, data-loss prevention, fraud prevention, and risk-assessment software, it is possible to reduce the data breach possibility to the lowest rate.
The top companies providing KYC nowadays include Fenergo, OrboGraph, SILO Compliance, GetID, Single Source, and many others - each company having their own solutions and features.
New developments, such as the blockchain, are becoming more widely used in many industries, and security is one of the main concerns for DLT-based projects. Crypto exchanges and trading operations have a severe problem with malicious cyber breaches and money laundering, but there is always a way to counter any issue.
Not only is it vital to build efficient systems for KYC, but you must work to eliminate the very possibility of any fraudulent action; and there are already several successful examples of this. For instance, idCredit has implemented a KYC aggregator within its flagship product, GetID.
The main focus is fraud prevention, making such examples as onboarding fake clients and utilizing money laundering schemes with fake documents impossible. The company is also working toward creating a unique digital ID to exclude the need for KYC procedures in every single service, which requires users to download tonnes of documents and lose a lot of time.
Conclusion
No matter what direction you choose for your business, it is vital that you protect your venture with a strong strategy and the latest technologies. Speaking of the digital asset industry, a decent KYC procedure will save you the trouble as you can be certain that money is not being laundered through your platform and that the proper authorities will not come for you one day to close the whole thing down, resulting in you and other users losing money overnight - such as what happened to the infamous BTC-E.