What Are the True Costs of Data Breaches?

Cyber security and protecting customer data continues to be top of mind for not only banks, but retailers, software firms, and any company that stores valuable data. These days it seems like not a week goes by without a report of another high-profile data breach.

P.F. Chang's became the latest retailer to be targeted at the point-of-sale with credit card information being targeted at 33 locations, it was revealed this month. This followed several high profile attacks that affected Target, Neiman Marcus, and other major retailers in late 2013 and early 2014.

Of course, financial data can be targeted at more than just retail POS systems. Websites that store valuable data are targeted on a near-constant basis. Most recently, this week news broke that a Russian gang of computer hackers stole 1.2 billion usernames and passwords, exposing vulnerability in some 400,000 websites.

While data breaches are costly for retailers and for banks that have to reimburse customer losses due to fraud, there is also a significant cost to consumers as well. Overall, the true cost of data breaches is significantly higher than one would think, according to multi-factor authentication provider Authentify. The firm estimates each breach costs about $5.4 million for the affected companies.

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