Review data security after LinkedIn hack

Last week, hackers stole more than six million passwords from LinkedIn.

And it was easy, reports the New York Times.

“The most negligent thing a company can do with users’ passwords is store them in plain text,” the paper says. Yet that’s what LinkedIn did.

“What has surprised customers and security experts alike is that a company that collects and profits from vast amounts of data had taken a bare-bones approach to protecting it. The breach highlights a disturbing truth about LinkedIn’s computer security: there isn’t much.”

And now, companies worldwide are reviewing their data security protocols. Advisors should, too. After all, a data breach can devastate your practice, but clients rarely raise the issue with advisors.

“Clients don’t typically ask the data security question,” says Olivia Woo, senior portfolio manager with the private client team at Mawer Investment Management in Calgary. That’s because they assume you have it covered.

Yet a data leak will shatter that faith. According to the latest Unisys Security Index, up to 85% of customers would go elsewhere if a financial firm lost their personal information, and half would take legal action.

To find out how to protect yourself, read Don’t lose client data, by Christopher Mason.

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.