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Data breaches can bring complex legal matters

It is no longer enough to lock the doors of your business at night and expect your valuables and confidential information to remain secure. If you use any kind of digital communications, store information on computers with online access or transact business digitally, your company is at risk.

No matter what industry your business serves, you must be aware of the danger and be proactive to prevent data breaches.

Whether you are a large, established corporation or a small business just starting out, you may be vulnerable to cyber-attacks if you fail to take the proper precautions. This includes minimizing authorization for accessing certain information and training your staff to use care when retrieving that data. It may also help you to understand the legal matters concerning the protection and privacy of your clients' information as well as your company's financial data.

Taking steps to protect your company and its clients

Data breaches are not simply an IT issue. Some security analysts suspect that every business in Ontario and across Canada has experienced a security breach of some kind, but many have not yet discovered it. This can result from a cyber-attack, but more often from a mistake by an employee who mishandles the personal and financial details of your customers, such as credit card accounts and identifying information.

If this describes your business, you may be placing the wellbeing of your clients in jeopardy. Repairing such a breach can ultimately cost your company dearly – including fines, settlements with affected clients and public relations expenses to repair your company's reputation. Some steps you can take to reduce the chances of a data breach include:

  • Establishing a multi-step login process
  • Updating software patches regularly
  • Creating a protocol for recognizing and responding quickly to data breaches
  • Maintaining an active role in the security of your business's accounts
  • Seeking the advice of professionals who can offer sound guidance for the protection of your business

It may be easier to leave cybersecurity to the software you install to protect your business, but this is not always enough. You will want to create a system of checks and balances and react quickly if a client or accountant raises questions about the data. Additionally, you may find it helpful to seek legal counsel to assist you in establishing company policies for handling confidential information – and to minimize your company's liability, if a breach occurs.

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