Sensitive data exposure is a critical issue that poses significant risks to individuals and organizations alike. With the increasing digitization of personal, business, and classified information, the potential for this data to be accidentally or maliciously exposed has grown substantially.
Understanding what constitutes sensitive data, how it can be vulnerable, the consequences of its exposure, and how to protect it is essential for maintaining trust, complying with regulations, and safeguarding against severe financial and reputational damage.
What is sensitive data?
Sensitive data refers to confidential information that, if disclosed or accessed without authorization, could potentially harm individuals, organizations, or both. This type of data requires limits to collection and processing, and special protection measures due to its sensitive nature and the potential consequences of its exposure.
Regulated vs unregulated sensitive data
Sensitive data can be broadly categorized into two categories.
Regulated sensitive data is controlled by specific laws and guidance that dictate how it must be handled. For example, health information is protected under HIPAA in the United States, while financial data falls under the Payment Services Directive (PSD2) in the EU.
In addition, there’s unregulated sensitive data that might not be governed by specific legal frameworks. However, it still needs to be protected according to organizational policies and best practices. Examples of this kind of data include job applications or employee contracts.
What are the different types and examples of sensitive data?
Additionally, there are three main types of sensitive data that are particularly vulnerable to exploitation by hackers and malicious insiders. These are:
- personal information
- business information
- classified information
Let’s explore each of these types in more detail.
Personal information
Personal information refers to data that can identify an individual. This category includes Personally Identifiable Information (PII), such as:
- full name
- Social Security number
- date of birth
- home address
- phone number
- email address
Also included is Protected Health Information (PHI):
- medical records
- health conditions
- treatments
- health insurance information
Business information
Business Information encompasses data that is critical to an organization’s operations and competitive edge. This includes:
- Trade secrets: Confidential business information that provides a competitive advantage
- Intellectual property: Creations of the mind, such as inventions, literary and artistic works, designs, and symbols used in commerce
- Proprietary business information: Internal data that is vital for a company’s strategy and operations
- Financial information: This includes bank account numbers, credit/debit card data, credit history records, tax filings
Classified information
Classified information is primarily associated with government and military data and is restricted due to its sensitive nature. This category includes:
- Classified government documents: Information that is restricted by the government to protect national security
- Military secrets: Confidential information related to national defense and security
It’s important to note that these categories often overlap, and the classification of sensitive data can vary depending on the context and applicable regulations. Organizations typically implement data classification systems to categorize information based on its sensitivity level, ranging from public to highly restricted
Sensitive data under regulations
Protecting sensitive data is not just a best practice, it is often a legal requirement.
For example, under the General Data Protection Regulation (GDPR), sensitive data includes categories such as:
- racial or ethnic origin
- political opinions
- religious beliefs
- trade union membership
- genetic and biometric data
- health information
- sex life or sexual orientation
Companies handling sensitive data must obtain explicit consent before processing it unless there is a valid alternative legal basis. They need to implement security measures to protect against unauthorized access and breaches and ensure they only collect and retain the minimum necessary information.
Even under state privacy laws that use an opt-out consent model, i.e. not requiring prior consent before collection and processing in most cases, data categorized as sensitive does still typically require prior consent.
When transferring sensitive data outside the European Economic Area, it’s crucial to ensure the receiving country provides adequate protection. Conducting a Data Protection Impact Assessment (DPIA) helps identify and mitigate privacy risks, particularly in large-scale or high-risk scenarios, by assessing potential threats and ensuring compliance with data protection standards. Data privacy laws typically outline the circumstances under which DPIAs are required, or just recommended.
In addition, the California Consumer Privacy Act (CCPA) and its amendment, the California Privacy Rights Act (CPRA), define sensitive personal information as data that reveals an individual’s:
- Social Security number
- driver’s license number
- financial account information
- precise geolocation
- racial or ethnic origin
- religious beliefs
- union membership
- genetic data
- biometric information
- health information
- sexual orientation
The CPRA requires businesses to obtain opt-in consent before collecting or processing sensitive personal information. Under the CPRA and many other US state-level laws, data belonging to children is categorized as sensitive by default.
Brazil’s Lei Geral de Proteção de Dados (LGPD) also recognizes sensitive data as a special category requiring additional protections. Similar to the GDPR, the LGPD generally prohibits processing sensitive data without explicit consent or unless specific exceptions apply.
Many privacy laws mandate that organizations implement security measures, including encryption and access controls, to protect sensitive data. Additionally, some regulations require appointing a Data Protection Officer (DPO) and conducting DPIAs for large-scale processing.
Given the complexity of these regulations, companies should research which laws apply to them based on their location, the nature of their data processing activities, and the locations and demographics of their customers.
What is sensitive data exposure?
Sensitive data exposure is the unintentional or unauthorized release of confidential information, such as personal details like names and addresses, financial data, or health records. Exposing personal information can happen due to external threats, but also internal mistakes. And this exposure typically occurs due to inadequate security measures, such as weak passwords, lack of encryption, errors in data storage and sharing practices, or other human error.
What’s the difference between data exposure and data breach
While the terms “data exposure” and “data breach” are often used interchangeably, they have distinct meanings.
Sensitive data exposure refers to the unintentional revelation of sensitive information, often due to misconfigurations or human error. It does not necessarily imply that the data has been accessed by malicious actors.
In contrast, a data breach involves intentional, unauthorized access to sensitive data, typically through malicious means.
It’s important to understand these differences to react appropriately to data exposure.
Sensitive data exposure example
Sensitive data exposure is a pressing issue that can have serious ramifications for individuals and organizations alike. Large companies are often at the greatest risk of data exposure. Here are a few notable examples that illustrate the impact of sensitive data exposure.
In 2017, Verizon partner Nice Systems accidentally exposed the personal data of millions of Verizon customers through a misconfigured Amazon S3 storage bucket. The exposed information included names, addresses, account details, and PIN codes. This sensitive data was publicly accessible to anyone who knew the web address of the cloud server, potentially putting millions of customers at risk of identity theft or fraud.
A year later, in 2018, a bug in Google+’s API potentially exposed private profile data of up to 500,000 users. The exposed data included names, email addresses, occupations, and birthdates. While there was no evidence of data misuse, the exposure existed for three years before its discovery.
In 2021, a misconfiguration in Microsoft’s Power Apps portal service led to the exposure of 38 million records across 47 organizations. The exposed data included COVID-19 contact tracing information, job applicant data, and employee information. This incident occurred due to a default setting that made data publicly accessible unless manually set to private.
Sensitive data often gets exposed due to lapses in data management practices. These examples underscore the importance of vigilance and proper configuration to safeguard sensitive information in our increasingly connected world.
Ways in which sensitive data can be exposed
Sensitive data can be exposed through various channels, often due to vulnerabilities in security practices. Organizations must be vigilant in protecting their valuable information assets from unauthorized access or disclosure. Here are some common ways sensitive data can be exposed.
- Misconfigured databases: Poorly configured databases can inadvertently expose sensitive data to the public by accidentally allowing open access, failing to patch regularly, and other security issues.
- Unencrypted data transmission: Transmitting data without encryption leaves it vulnerable to interception by unauthorized parties.
- Insider threats: Employees with access to sensitive data can pose a risk, even if unintentional. This can involve mechanisms as mundane as email.
- Device loss or theft: Laptops or mobile devices containing sensitive information can be easily lost or stolen, leading to exposure.
- Weak access controls: Insufficient access controls can allow unauthorized users to access sensitive data.
- Outdated software vulnerabilities: Failing to update software can leave systems open to exploitation by attackers.
How to safeguard and manage sensitive data within your organization?
Protecting sensitive data is crucial for every organization. Whether you’re a small business or a large company, implementing sensitive data protection measures to avoid data vulnerability is non-negotiable. To help organizations tackle this challenge, the Open Web Application Security Project (OWASP) offers expert insights and actionable best practices for enhancing software security.
Let’s break down some practical steps you can take to keep your sensitive information safe, incorporating OWASP’s guidelines along with other industry best practices.
Identify and classify sensitive data
OWASP recommends creating a comprehensive inventory of all sensitive data processed, stored, or transmitted by your systems. This may include:
- customer information
- financial records
- intellectual property
- employee data
Once identified, classify this data based on its level of sensitivity. This classification will help determine appropriate security measures for each category.
Implement strong access controls
Restrict access to sensitive data on a need-to-know basis. For example, to limit sensitive data exposure, OWASP emphasizes the principle of least privilege, advising organizations to limit access rights to the minimum necessary for users to perform their jobs. They also recommend implementing strong authentication methods, such as multi-factor authentication, for accessing sensitive data.
Encrypt sensitive data
Encryption is a powerful tool for protecting sensitive information. OWASP stresses the importance of using up-to-date and strong standard algorithms for encryption. They advise encrypting all sensitive data both at rest and in transit and implementing proper key management practices. Additionally, consider end-to-end encryption for highly sensitive communications.
Secure physical and digital storage
Protect your data wherever it resides. This means using secure, encrypted storage solutions for digital data and implementing physical security measures for onsite servers and paper documents. Lastly, regularly back up data to secure, offsite locations or encrypted cloud services.
Train employees on data security
Your employees are your first line of defense. Therefore, don’t forget to conduct regular cybersecurity awareness training. This involves educating staff on identifying phishing attempts and other common cyber threats, establishing clear policies on data handling, and ensuring all employees understand their responsibilities.
Keep systems updated
Maintain the security of your IT infrastructure. This entails:
- Regularly updating all software, systems, and applications.
- Using a patch management system to automate updates and fix security vulnerabilities.
- Implementing firewalls and antivirus software, keeping them up to date.
Monitor and audit data access
Keep track of who accesses sensitive data and when. To do this, implement logging and monitoring systems to track data access and usage. Conduct regular audits to detect any unauthorized access or suspicious activity. And use data loss prevention tools to monitor and control data movement.
OWASP also recommends independently verifying the effectiveness of configurations and settings. This includes testing all cryptographic modules to ensure they’re operating correctly and verifying that security controls are properly configured and working as intended.
Develop an incident response plan
If your company handles sensitive data, you need to be prepared for potential data breaches. Therefore, create a comprehensive incident response plan that defines roles and responsibilities for handling security incidents. Then regularly test and update your plan to ensure its effectiveness.
Secure third-party relationships
You want to be sure to protect your data when working with external partners. To keep your sensitive data safe, assess and monitor the security practices of vendors who have access to your data. Consider implementing strong contractual agreements regarding data privacy and security. But also, limit vendor access to only the data they need. When working with third parties that are in other countries, there are additional requirements for security regarding international data transfers, too.
Implement a consent management platform (CMP)
To enhance your data protection and compliance, consider implementing a consent management platform. This collects and manages user consent for data processing activities, maintains detailed records of consent for compliance purposes, and provides users with easy-to-use interfaces to manage their privacy preferences.
A CMP like Usercentrics CMP is easy to integrate across your organization’s systems and platforms and helps you comply with data protection regulations like the GDPR and CCPA.
Compliance fines for sensitive data exposure
Compliance fines for sensitive data exposure are a growing concern for businesses globally as more and more data privacy laws are passed, and when penalties for sensitive data exposure or breaches can be even higher than baseline ones. With information exposure frequently in the news, regulators are enforcing strict penalties to ensure companies prioritize data protection.
Under the GDPR, organizations can face fines of up to EUR 20 million or 4 percent of global annual turnover (whichever is higher) for improper handling of sensitive data, including unauthorized exposure. These fines apply even if no breach has occurred, as the regulation has a higher penalty tier for more egregious or repeat offenses, and focuses on the principles of data protection and privacy by design.
In the US, the FTC can impose penalties of up to USD 40,000 per violation for unfair or deceptive practices related to data security, which can include improper exposure of sensitive information. Each day of noncompliance may be treated as a separate violation, potentially leading to substantial cumulative fines.
For US healthcare organizations, HIPAA violations related to improper exposure of protected health information can result in fines of up to USD 1.5 million per year. The exact amount depends on factors like the nature of the exposure and the organization’s compliance history.
Fines are typically determined based on factors such as the sensitivity of the exposed data, the duration of the exposure, the number of individuals affected, and the organization’s response and remediation efforts. Regulatory bodies also consider whether the exposure was due to negligence or intentional actions.
To avoid these penalties, organizations should implement data protection measures, conduct regular security assessments, and ensure proper handling and storage of sensitive information at all times.
Put in place measures to protect your sensitive data
Protecting sensitive data is not just a matter of regulatory compliance. It’s a crucial aspect of maintaining trust and security. From understanding the various types of sensitive information to implementing robust security measures and staying informed about regulatory requirements, organizations must be proactive in preventing data exposure.
By taking these steps, you can minimize the risk of data exposure, protect your organization from costly fines, and maintain the privacy and safety of your customers and employees.
