Protect Your Data So You Can Focus on Your Jewelry

Courtesy of Jewelers Mutual Insurance Co.

When you think about theft within your business, protecting your inventory is probably the first thing that comes to mind. Unfortunately, that isn’t the only theft that can harm a business: data theft and fraud can have an even greater financial impact on your bottom line.

If you’re storing records electronically, taking payment via credit card, or paying employees, you’re working with personally identifiable information—which includes details beyond already public knowledge, such as social security, financial account, and even driver’s license numbers. When that information is breached, it can be big news and cause serious damage to your reputation and your bottom line. 

In the United States, 66 percent of all organizations surveyed said they had at least one data breach in 20121—an error that can be expensive both financially and in terms of reputation. In fact, in the United States, data-breach incidents cost companies, on average, $194 per record—for a total cost to companies of $5.4 million in 2012.2

So how can you keep something you can’t really see or touch safe? Start with these tips from Jewelers Mutual:

• Limit what’s portable.One lost laptop can unveil a plethora of personal data, from employees’ social security numbers to customers’ credit card numbers. Set a password on your computer, and store your records on an encrypted hard drive.

  While some hackers have gotten around encryption, it’s more difficult to access encrypted than unencrypted data. Another benefit to using encryption is that, in some states, you’re only required to report breaches to customers if the data was unencrypted.3

• Keep your eye on employees. When you’re thinking about data breach and cyber-related security issues, it’s not just some faraway hackers you need to worry about. Nearly 47 percent of recorded breaches are due to malicious attacks, which is the combination of hacking and insider theft.4That’s why it’s important to limit the number of employees who have access to sensitive data.

  And an internal breach isn’t always intentional. A flash drive or file-sharing music software and access to the files is all it takes for an employee to create a data breach. Nearly two-thirds of data breaches are due to human errors and systems glitches.5 Even if the breach is accidental, the information trusted to your business could be in criminals’ hands.

• Shred your files. As with most types of traditional crime, jewelers are at special risk for data breach. Invest in hiring a reputable secure shredding and disposal service to protect any printed copies of information with which you work on a daily basis.

• Clear your copier’s hard drive.When you make a physical copy of sensitive data, that information doesn’t necessarily disappear when the paper is shredded. Nearly every copier contains a hard drive, which means it stores a copy of every document you scan, print, copy, or fax.

  If you decide to sell or stop using a copier, make sure you clear its hard drive first. Also, consider purchasing security or encryption for your copier, which are available from most manufacturers. 6

• Keep your software up to date. Hackers focus on weak spots in software. When the companies who make software uncover the weaknesses, they release software updates, also known as patches, to fix them. Keeping your software updated can reduce your vulnerability.
• Limit your data. Don’t collect information unless it’s essential to your business, and—when you have critical data—limit the number of places where you store it. Purge the data when you no longer need it.

• Don’t be the victim of fraud.When thieves steal bank account or credit card information, they typically work fast so that they can make purchases before the account is shut down.

  Be alert when you accept credit card payments. If someone from out of state tries to purchase merchandise over the phone or online and pushes for speedy shipment, it’s good to be suspicious. Ask the credit card company or bank to contact the account holder to verify the transaction.

  If you accept checks for payment, always require two forms of identification including a photo ID. If you’re not selling in an area known for tourism, consider accepting only local checks. If someone gives you a certified, cashier’s or personal check after hours or on weekends—when you can’t verify the funds at your bank—think twice about accepting it.

• Speak with IT. E-commerce provides opportunity for your business, but it also increases your risk of data breach and cyber related security issues. Be sure that your IT department or e-commerce providers have sound security protocols in place. Ask them to create data breach emergency response plans if they don’t already have one in place, and stress your concern about protecting personally identifiable information.
• Make sure you’re covered. If a data breach occurs, it’s not something you can keep quiet. Currently 46 states require you to notify customers—and a simple “I’m sorry” letter might not be enough to satisfy them. Ensure you’re prepared for the public relations headaches, credit monitoring, and legal expenses that could be involved with a data breach by exploring data-breach and cyber-related protection insurance coverage options.

To learn more about data breach and cyber-related protection, visit Jewelers Mutual’s website at JewelersMutual.com.

MJSA exclusively endorses Jewelers Mutual Insurance Company’s commercial and personal jewelry insurance products. To learn more about Jewelers Mutual’s coverages and to find an experienced insurance agent in your area, contact Jewelers Mutual at 1-800-558-6411.

1. Ponemon Institute and Thales e-Security, 2012 Global Data Encryption Trends Study (Traverse City, MI: Ponemon Institute, February 2013), www.verisec.com/sv/wp-content/uploads/sites/2/2013/03/Global-Encryption-Trends-Study-eng-ar.pdf.

2. Ponemon Institute and Symantec, 2013 Cost of Data Breach: Global Analysis, (Traverse City, MI: Ponemon Institute, June 2013), https://www4.symantec.com/mktginfo/whitepaper/053013_GL_NA_WP_Ponemon-2013-Cost-of-a-Data-Breach-Report_daiNA_cta72382.pdf.

3. “Data Breach Prevention Tips,” accessed September 18, 2014, www.krollcybersecurity.com/resources/data-security-resources/data-breach-prevention-tips.aspx.

4. Privacy Rights Clearinghouse, A Chronology of Data Breaches: Security Breaches 2005 to the Present, last modified December 2013, accessed September 18, 2014, www.privacyrights.org/data-breach.

5. Ponemon and Symantec, 2013 Cost of Data Breach, (Traverse City, MI: Ponemon Institute, June 2013), https://www4.symantec.com/mktginfo/whitepaper/053013_GL_NA_WP_Ponemon-2013-Cost-of-a-Data-Breach-Report_daiNA_cta72382.pdf.

6. Keteyian, Armen, “Digital Photocopiers Loaded with Secrets,” (CBS News, 19 April 2010), www.cbsnews.com/news/digital-photocopiers-loaded-with-secrets/.