Ponemon Survey: Securing Outsourced Consumer Data

Survey reveals 56 percent of respondents acknowledged incidents when their organizations did not act on a vendor’s data breach

February 28, 2013

3 Min Read


Costa Mesa, Calif., Feb. 26, 2013 -- A new study, Securing Outsourced Consumer Data, commissioned by Experian Data Breach Resolution and conducted by the Ponemon Institute reveals that many organizations (46 percent) do not evaluate the security and privacy practices of vendors before sharing sensitive or confidential information.

The survey polled nearly 750 individuals in organizations that transfer consumer data to third-party vendors. The goal of the survey was to increase understanding of data breach frequency when consumer data is outsourced, to determine what steps are taken to ensure vendors' data stewardship, and to evaluate privacy and security practices between companies and outsource vendors.

"Many companies have higher standards for their in-house data security practices than they have for vendors that they enlist to hold customer information," said Michael Bruemmer, vice president at Experian Data Breach Resolution. "The standards should be consistent, because not adhering to the same policies leaves companies vulnerable."

When sharing sensitive and confidential consumer information, nearly half of respondents (49 percent) said that they do not monitor -- or are unsure whether their organization monitors -- vendor security and privacy practices. Additional key findings from the survey include:

· Outsourcing consumer information demands oversight -- Survey results indicate that organizations that transfer or share consumer data with vendors experience data breaches more often than not

o Sixty-five percent of respondents said their organization had a data breach involving the loss or theft of their organization's information, and the majority (64 percent) report that it has happened more than once

o Sixty-four percent of respondents reported their organization has experienced more than one data breach

· Training is essential to protect against data breaches -- Causes for data breaches can be reduced significantly through enforcement of policies and effective training

o Forty-five percent of respondents reported negligence as the root cause of third-party data breaches

o Forty percent of data breaches were the result of lost or stolen devices

· Security and control procedures need improvement

o More than half of respondents (56 percent) said their organization learned about a data breach accidentally

o Only 27% said the organization's security and control procedures uncovered the incident; only 23% said the vendor's security and control procedures alerted the organization to a breach

"It is imperative that businesses and organizations place a priority on evaluating a vendor's ability to secure sensitive data," said Dr. Larry Ponemon, chairman and founder of the Ponemon Institute.

To access the full report, Securing Outsourced Consumer Data, visit http://www.Experian.com/ConsumerDataStudy.

For more information, visit http://www.experian.com/databreach.

About Experian Data Breach Resolution

Experian® is a leader in the data breach resolution industry and one of the first companies to develop products and services that address this critical issue. As an innovator in the field, Experian has a long-standing history of providing swift and effective data breach resolution for thousands of organizations, having serviced millions of affected consumers. For more information on the Experian Data Breach Resolution division at ConsumerInfo.com, Inc. and how it enables organizations to plan for and successfully mitigate data breach incidents, visit http://www.experian.com/databreach.

About Experian

Experian is the leading global information services company, providing data and analytical tools to clients around the world. The Group helps businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making. Experian also helps individuals to check their credit report and credit score, and protect against identity theft.

For more information, visit http://www.experianplc.com.

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