Fraud Risks: Lessons Learned From The NPD Data Breach
Data breaches continue to make headlines; however, the recent National Public Data (NPD) breach was one of the most damaging, highlighting the importance of protecting sensitive information through proactive cybersecurity. As one of the larger data breaches in recent years, it exposed personal data like social security numbers, home addresses, work history, and more. This gave the cybercriminal responsible for this attack enough information to carry out identity theft, financial fraud, and sell the data on the dark web.
This is an example of the risks faced by businesses when their cybersecurity efforts fall short, but it offers valuable lessons that we all can learn to better protect ourselves, employees, customers, and systems. In this blog, we will examine the NPD breach, the fraud risks that arose from this incident, and key strategies that every business leader should focus on to reduce exposure to similar risks.
Managed IT Services
Protect your company from a data breach with the help of an MSP partner. With access to a team of experts, advanced technology, and cloud services, your systems will remain secure.
What is the NPD Data Breach?
National Public Data (NPD) is a Florida-based company that compiles available information to perform background checks. It has created an extensive database that includes personal information like SSN, addresses, employment history, and more. A sister company of NPD, known as Records Check, provides similar services.
Unfortunately, the Records Check website was storing “plaintext passwords” – these are passwords that are not encrypted and can be easily read. These passwords were stored in a back-end database that was accessible from the website’s homepage. Hackers could easily access this information and infiltrate their system to gain access to all of the data being stored. Once inside, the cyber criminals obtained social security numbers, addresses, relationships, and employment history of over 170 million people.
What makes this particular breach different from others is the sheer volume of information that was leaked to the hackers and then made available on the dark web. Cyber criminals were able to leverage the information gathered to create scams, target individuals by impersonating past colleagues, relatives, or bosses, and ask for financial help.
5 Types of Fraud Risks Related to the NPD Breach
- Unauthorized purchases: Hackers with access to full names could open new accounts or make unauthorized purchases.
- Identity theft: Gaining social security numbers for millions of people allowed these criminals to open credit accounts, loans, or other financial activity.
- Physical threats: The breach exposed physical addresses, revealing where people worked or lived and enabling strangers to locate these addresses for further harm.
- Phishing attacks: When phone numbers were listed, scammers could perform phishing through text messages or calls to gather personal and financial details.
- Spam emails: Targeted phishing, account theft, unauthorized access, and an increase in spam emails resulted from hackers gaining access to email accounts through this breach.
As hackers become better at piecing together information they get through breaches, more people will fall victim to unexpected financial scams. Preventative measures can be taken to help businesses protect their employees and customers.
How to Reduce Financial Fraud as a Data Breach Victim
The NPD breach exemplifies the critical need for robust IT security. The exposed passwords and leaked data provide cyber criminals with opportunities to steal identities, craft fraudulent messages, or engage in other malicious activities.
Businesses should always be aware that something like this could happen to their system in the future. Taking precautions now will help reduce the risk and prevent damage to your employees or customers. If an incident like this threatens your business, these preventative steps could help lower the chances of hackers getting through.
7 Essential Cybersecurity Methods to Prevent Financial Scams
- Pressure test
Simulate real-world attacks like a data breach to assess whether your system is prepared to safeguard your infrastructure. Identify any gaps and consider implementing new control processes or technologies that will better protect your employees or customers who are likely to be affected. - Training and awareness
Educate your staff on data security and how they can help prevent future threats. Incorporate cybersecurity training into your onboarding process and hold annual sessions on phishing scams, multifactor authentication, and daily measures employees should take to protect the business. - Data encryption
Make sure all sensitive data is encrypted in transit and at rest to make it more difficult for cyber criminals to access and use the data within your system. Look into cloud storage programs and consider migrating to a tool that enforces encryption by default. - Tokenization
By tokenizing your information, a randomly generated unique identifier will reference the original data without ever exposing it. - Penetration testing and security audits
Proactively identify security gaps and vulnerabilities before hackers discover them. Conduct both internal and external testing annually, while security audits should be performed at a frequency that matches the level of risk your system faces. - Incident response
Develop and sustain a comprehensive incident response plan that outlines the steps to take during an attack or breach. This should also specify who is responsible for managing the situation, how to contain the breach, and how to notify anyone who may have been impacted. - Multifactor authentication requirements
Enforce multifactor authentication measures for everyone involved in the business and establish strict guidelines for what constitutes a strong password to ensure endpoints are secure.
Understanding the types of threats from a data breach is crucial for effective preparation. Implementing proactive measures, training your employees, and regularly testing your IT systems will reduce risks and minimize damage if a breach occurs.
Managed IT Services
Protect your company from a data breach with the help of an MSP partner. With access to a team of experts, advanced technology, and cloud services, your systems will remain secure.
Help Your Customers Avoid Fraud With Extensive Cybersecurity Measures
This large-scale breach highlights how a single weakness in your cybersecurity plan can have serious impacts on businesses and their customers. Protecting sensitive data requires a proactive, layered cybersecurity strategy. Working with a managed service provider allows companies to rely on IT experts for security, ongoing monitoring, and proper system setup to stay prepared against any threats that could compromise their infrastructure.
Don’t wait until an incident like this occurs in your business — contact us today to discover how our team at Applied Tech can strengthen your defenses, reduce risk, and protect your customers from fraud.
About Applied Tech
Applied Tech is a leading IT and cybersecurity services provider dedicated to helping businesses protect their digital assets. Our proactive and strategic services include cloud management, security, productivity, and IT growth strategy. With a team of experienced professionals, we provide unique solutions tailored to your IT needs.
Protect your business with Applied Tech’s fully managed IT services, co-managed support, and security assistance. With IT services focused on your business goals, keep your team productive and your data secure.
