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Retrieved Nov 04, 2009 | 07:03 PM
By Tim Wilson
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CorporateBreaches Increase Chances Of Consumer ID Theft, Study Says
When their data is leaked by abusiness, individuals are four times more likely to suffer identity theft,Javelin study says
Consumers who have received data breach notifications within thepast year are at a much greater risk for fraud than typical consumers,according to a new study.
According to a report published last week by Javelin Research,individuals whose personal information has been compromised in a corporatebreach are four times more likely to suffer identity theft or fraud. Thisresult runs contrary to the common mantra among breached companies, which oftensay that they have no indication that the compromised data has been used bycriminals.
“Data breach notifications are intended to help consumerstake protective action,” said Mary Monahan, managing partner and researchdirector at Javelin. “Notification is critical because consumers are overfour times more likely to encounter actual fraudulent transactions if theyreceive a data-breach notification.”
But the Javelin study also indicates that most consumers don’t seea direct relationship between breach notifications and identity theft.
“During each of the past three years, an average of 11percent of consumers received a breach notification,” Javelin said.”Slightly more than 33 percent of breach victims experienced exposure oftheir Social Security numbers, and 15 percent of breach victims had their ATMPINs compromised. [But] despite 19.5 percent of breach victims suffering somekind of fraud in the past year, only 2 percent attribute their fraud to thebreach.”
The Javelin report, “Data Breach Notifications: Victims FaceFour Times Higher Risk of Fraud,” is based on multiple years of data andincludes updates on 2009 data breaches. The report also presents a timelineoverview of the most recent and egregious data breaches in U.S. history, withrecommendations for how individuals and companies can increase safety.