United States Companies and the Cyber Attack Aftermath

The United States has been the favorite target of cyber attacks; this is due to Fortune 500 companies and other large firms chose the US as their headquarters. Compromised records, stolen information and phishing expeditions, the cybercriminals are making a lot of fortune from the weakness of the IT infrastructure of many companies. IBM and the Ponemon Institute released last July a comprehensive 2018 Cost of a Data Breach Study: Global overview, which details on how big target the United States has become and the mitigations that can be applied in order to remedy the problem.

On the average, the United States-based company’s cost to recover from a data breach stands at $7.91 million per incident. This is double the global average of just $3.86 million; it becomes harder to recover from a controversial data breach if the brand is popular. The report came from the result of a Ponemon’s survey of 2,200 IT leaders from 477 companies that were involved with a cybersecurity issue.

The survey also covered firms from 15 countries, overall 7% of the organizations that joined the survey are retailers in their respective countries. The survey concluded its study and enumerated the following components of the cost of a security breach:

1. Brand damage, and the cost of recovering it
2. The estimated cost of lost customer trust
3. The Missed opportunity of acquiring new clients after the data breach
4. Operation disruption and the time required before restoring normal operations
5. Cost of isolating the damage
6. Fines (especially GDPR, if applicable)
7. Attorney’s fees (when dealing with lawsuits)
8. Added cost of help desk
9. Damage control in the form of customer appeasement (discounts, rebates and etc.)
10. The hiring of IT experts to fix the issue
11. Notification cost in order to communicate with the victims of the breach.
12. Cost of forensic experts to find the true origin of the breach and the creation of a program to prevent a future breach.

The United States-based companies also have a higher number of recorded individual data breaches, averaging 31,265 stolen records compared to the global average of just 24,615 records per incident. The bigger the number of records stolen through a security breach, the harder the recovery and the higher the spending. The IBM report also broke down the statistics of where the security breach originated. The three most common costs were system glitch (25%), negligence/human error (27%) and done by cybercriminals or malware (48%).

The first action of a firm against a cyber attack is the identification that the company was indeed at the receiving end of one. Under the report, it mentioned that on average time to identify a cyber attack was 197 days after it actually happened. The US statistics are much worse, 201 days were needed to identify that a cyber attack took place. IBM also measured the average time until the cybersecurity problem is fixed, globally it is 69 days after the discovery of the breach. The US statistics slightly fared better at 52-days, but spending 201 days in the dark before a breach was detected is already death wish for any company.