How To Prepare Your Small Business For An Inevitable Data Breach

[Audrey McNeil <audrey () riskbasedsecurity com>]

http://www.forbes.com/sites/adamlevin/2014/02/13/how-to-prepare-your-small-business-for-an-inevitable-data-breach/

If some in the small business community thought to themselves, "better them
than us," after hearing that hackers had breached mega chains Target,
Neiman Marcus and (possibly) Michaels, their bliss was short-lived. Reports
surfaced last week that the cyber-intruders accessed Targets' systems by
first hacking one of their (comparatively) small regional contractors,
Fazio Mechanical Services.

Fazio, though, is in good company: a list of the 91 breaches reported in
the first 43 days of 2014 compiled by the Identity Theft Resource Center
shows not just trusted brands - Home Depot HD +0.12%, Walgreens, TD Bank -
but a variety of small medical offices and other small businesses whose
owners perhaps never thought they'd be targets, too.

That is the crux of the problem facing America's small businesses and
consumers: they may not think they'll be targets of hackers looking for big
scores... but all of them probably will be. It's just too easy and too
lucrative for hackers to gather and utilize people's personal information
for anyone to be safe - including small enterprises with databases that
seem at first blush to be of limited utility.

Reality check: hackers will always go after the weakest link. If they
determine that the big guys have toughened up, they're just going to go
after easier targets, like small businesses.

So what is a small business owner to do? Instead of throwing up your hands
and assuming you can't afford the technology that big companies use, make
the 3 Ms your mantra: Minimize, Monitor and Manage. Make yourself a harder
target TGT +0.25% and know what to do when you become one anyway.

Minimize Your Risk of Exposure

The most important step you can take is to be proactive about your own
security, rather than waiting until it's breached. Some specific steps
include:

- Determine the right security technology and processes for your business,
regardless of its size or complexity.
- Train your employees about security - which includes not falling for
spear-phishing emails, not checking personal email or social media on
company systems, and not leaving unsecure devices or files unattended.
- Limit access to important systems and databases to only those people who
need it, assign each employee a discrete password and never allow them to
share passwords for systems - social media or administrative.
- Use two-factor authentication on everything you can, and require that
your employees do so as well.
- Put your financial systems, like payroll and banking access, on a
separate computer than the one you use for other functions.
- If you and your employees bring your own devices for work - like
cellphones, tablets and computers - establish security protocols for those
devices connected to your system and procedures for protecting them.
- Make sure you have the right physical security for your business.
- Require complete destruction of any documents or computers you no longer
need.
- And, finally, have frequent outside security reviews to ensure that you
are as safe as you think you are.

Monitor Your Security

Don't rely on a system you set up last year to work next year. On an
ongoing basis, make sure that you:

- Use a reputable firm to do periodic penetration testing of your network
to ensure that no unauthorized user can gain access - and fix the problem
immediately if someone can.
- Set up automatic alerts for unusual activity on your networks, so that
any such activity results in an email or text message to someone empowered
and able to fix any such problem.
- Designate a compliance officer who constantly checks that your employees
adhere to your security policies and procedures.
- Install all security updates for software and operating systems in a
timely fashion on all devices, even those brought in by your employees.
- Scrutinize your vendors as you do your own employees: vet them and
require them to engage in the same testing as you.

Manage the Damage

Make no mistake, everyone will probably experience some sort of breach in
the coming years, if they haven't already, so don't rely on best practices
to prevent future problems. Create a plan before you have an issue in order
to make sure you can deal with it. Some ways to develop such a plan include:

- Contact your insurance agent or your financial institution to see if they
offer cyber liability coverage or a damage control program. You may be
pleasantly surprised to learn that you are already protected. If not, find
out what you need to do and do it.
- Determine whether that plan covers all the costs of a data breach - like
the expense of notifying customers or employees whose data was exposed -
and whether the plan will help you and/or your customers navigate the
aftermath.
- Make sure you understand what, if any, time-sensitive reporting
requirements are mandated after a breach in order to maintain your coverage.
- Decide how you will deal with any post-breach media: will you designate
someone internally to be your company's public face, or will you hire a
company to do it for you (and which company will you want to hire)?
- Have a plan in place for how to deal with post-breach phone calls from
affected employees and/or customers.
- Decide what you will do for those individuals affected by your breach.
Though it's now standard to offer credit monitoring, that often isn't
enough for many people: you may need to contract with a company or person
to guide victims of your breach through the reporting and resolution
process, or do the work for them.

The dangers you face from a data breach often go far beyond penalties,
fines, regulatory interactions and litigation. Depending upon the public's
perception of the urgency, empathy and transparency you demonstrate, you
could face a devastating loss of trust by business partners, clients and
consumers alike.

To even begin to prevent that kind of damage, start by being as protective
of the customer and employee data you gather and store as you are with your
own trade secrets or intellectual property.

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