Cloud Backup Can Help with Stricter Data Protection Legislation for Financial Businesses

Tue, 04/10/2016 - 11:02
Data Backup

This just in: the reports that as part of the Brexit strategy, the new information commissioner (of the UK’s ICO) wants data protection laws similar to that of the EU’s General Data Protection Regulations (GDPR). Since many businesses across the globe have their headquarters in England, it’s safe to say that there will be far-reaching consequences to stricter data protection oversight. By being part of the EU, the UK would have had to adopt the GDPR anyway but it seems it isn’t going to get left behind when it comes to providing data security to its citizens.

It’s a Global Affair

If that’s not enough, the EU is working on their Cybercrime Directive. It’s largely aimed at companies in high risk industries, such as the financial sector, to publicly disclose data security breaches. Public humiliation notwithstanding and a terrible knock to one’s reputation, fines of up to 2% of global annual turnover can be instituted for failure to comply.

Moving further afield, also remember that the EU-US SafeHarbour Agreement was recently ruled to be invalid. This gives the GDPR higher priority for multinational companies in Europe that keep their cloud backups and cloud storage within US borders.

It Protects Everyone

Better legislation and monitoring is there for everyone’s safety. It protects both the individual and the company in case of a data security breach. Yes, it’s easier to get penalized but it also becomes easier to protect your customer once data protection measures have been put in place.

There’s Good Reason for It

The 2016 KPMG Fraud Barometer for the UK shows that financial institutions are worst affected by data theft and data loss – contributing 38% of incidents (government is second with 26%). The scale falls as it gets to the individual and small business. It’s also interesting to note that, even from 2010, data loss of financial services affected 8.4 million people globally. The global scale differs slightly in that health services are next on the scale with 3.8 million people being affected.

The Data is Worth It

So with fines and court cases, class action lawsuits and reputational damage, the stakes are high for companies to do their best to mitigate these risks. The Cyber Risk Survey Report of 2015 shows that for those companies that haven’t estimated the impact of a cyber attack the cost escalates almost exponentially compared to those who have taken precautions.

Cloud backups are the key failsafe to protecting against data loss – especially in the financial industry where data travels between continents and data sovereignty is to be respected. The reasons for cloud backup are simple and the benefits far outweigh the cost and consequences of losing data.

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