Has Data Breach Legislation actually impacted ID Theft?

According to a recent paper published by Sasha Romanosky, Rahul Telang and Alessandro Acquisti of the Heinz School of Public Policy and Management at Carnegie Mellon University, the data breach legislation instituted from 2002 thru 2006 has had little effect on reducing ID theft.
While the legislation has not reduced ID theft cases the debate is still ongoing if has slowed the rate of increase. It seems the rate of increase is the same in states with legislation and in those without legislation.

A fascinating study showing how the legislation has made companies more aware, vigilant and proactive, but the net result is just plain lacking. Some of the more intersting findings from the paper were:

1. 44% of consumers ignore data breach notices, Choicepoint indicated that only 10% of consumers opted for the free credit watch services.
2. Most companies under estimate the costs associated with a data breach. Choicepoint reported a cost of $26 million related to their data breach and TJ Max reported a cost of 178 million related to their data breach.
3. The impact of a data breach on a companies overall performance, sales and stock performance are temporary typically lasting less than 4 quarters.
To read more on this article go to: "Do Data Breach Disclosure Laws Reduce Identity Theft?".

“We value and secure your private data”

The article from SCMagazineUS.com “Clothing retailer settles with FTC over credit breach” by Dan Kaplan may seem routine. It discusses the missteps the FTC believed the company Life is Good had taken and it outlined the corrective actions. But take a minute to reread the statement by Dan Kaplan; “The FTC said the merchant deceived customers by stating on its website that it valued and secured private data.” Wow, that got my attention. How many retailers take that statement for granted on their website?

Takeaway items:
· If you say you are doing something related to consumer data, you better being doing it.
· Data security issues can still damage your brand and your sales, even if nobody is defrauded. Mr. Kaplan stated in his article that there was no documented case of actual fraud from this breach of over 10,000 accounts.

To read the full article from SCMagazineUS.com “Clothing retailer settles with FTC over credit breach” by Dan Kaplan go to : “Clothing retailer settles with FTC over credit breach”