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Uber Fined $148m for Breach Cover-Up

Attempting to cover up a data breach was a failed mission for Uber, who yesterday announced that it has agreed to a $148m settlement. The fine for its 2016 data breach and cover-up sends a strong message not only to Uber but to organizations across all sectors that data breaches – whether disclosed or not – come at a hefty price.

Companies can no longer get away with poor cybersecurity and sweeping incidents under the carpet,” said Rob Shapland, principal cybersecurity consultant at Falanx Group. "I would expect many companies will have tried to hide the fact that they’ve been breached, especially given the size of the potential fines. This case, and Uber’s punishment for not revealing that the breach had occurred, will hopefully give companies further warning of the risks posed by cyber-attacks, so that they take the security of the data they hold more seriously.”

In November 2017 Uber shocked the cybersecurity community when it confessed that it had indeed attempted to hide the fact that data of 57 million users was stolen. In response to the settlement news, Tim Erlin, VP at Tripwire, said, “There’s no doubt that the cover-up behavior was impactful in how this settlement played out. It’s a good reminder to all organizations of how a good breach response plan can help avoid poor decision making in the midst of an incident.

The fine is huge, which has some commentators wondering whether it is intended to set a precedent in order to deter other organizations from attempting to cover up future breaches.

“Trying to keep [a breach] quiet will of course be an idea by some senior ranked employees. However, this is inevitably the wrong thing to do, and Uber is surely being made an example of what not to do,” said Jake Moore, security specialist at ESET.

“Being open about customer data breaches at the earliest opportunity is not only ethically the right thing to do, but helps protect people from a multitude of other attacks which could follow as a result.”

Moreover the fine speaks to the financial risks of compliance mismanagement. That a breach of such magnitude was able to happen was problematic enough, but paying the hackers $100,000 to delete the data and keep the breach quiet, rather than report the incident, was “A blatant disregard for governance and compliance, putting customers at risk,” said Pravin Kothari, CEO of CipherCloud.

“The takeaway lesson is that it is incumbent upon all of us to foster a culture in our companies such that our employees understand the ethical necessity of full disclosure and transparency. Protecting our customers and their data is not optional.”

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