£80,000 Fine For London Estate Agency Highlights Importance of Due Diligence in Data Protection

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The issuing of an £80,000 fine by the Information Commissioner’s Office (ICO) to London-based estate agency Parliament View Ltd (LPVL) highlights the importance of due diligence when keeping customer data safe.

What Happened?

Prior to the introduction of GDPR, between March 2015 and February 2017, LPVL left their customer data exposed online after transferring the data via FTP from its server to a partner organisation which also offered a property letting transaction service. LPVL was using Microsoft’s Internet Information Services (IIS) but didn’t switch off an Anonymous Authentication Function, thereby giving anyone access to the server and the data without prompting them for a username or password.

The data that was publicly exposed included some very sensitive things which could be of value to hackers and other criminals including addresses of both tenants and landlords, bank statements and salary details, utility bills, dates of birth, driving licences (of tenants and landlords) and even copies of passports.  The ICO reported that the data of 18,610 individual users had been put at risk.

Hacker’s Ransom Request

The ICO’s tough penalty took into account the fact that not only was LPVL judged to have not taken the appropriate technical and organisational measures to prevent unlawful processing of the personal data, but that the estate agency only alerted the ICO to the breach after it had been contacted by a hacker in October who claimed to possess the personal data of LPVL’s, and who had requested a ransom.

The ICO judged that LPVL’s contraventions of the Data Protection Act were wide-ranging and likely to cause substantial damage and substantial distress to those whose personal data was taken, hence the huge fine.

Marriott International Also Fined

The Marriott International hotel chain has also just been issued with a massive £99.2m fine by the ICO for infringements of GDPR, also related to matters of due diligence.  Marriott International’s fine related to an incident that affected Starwood hotels from 2014 to 2018 (which Marriott was buying).  In this case, the ICO found that the hotel chain didn’t do enough to secure its systems and undertake due diligence when it bought Starwood.  The ICO found that the systems of the Starwood hotels group were compromised in 2014, but the exposure of customer information was not discovered until 2018 and by this time, data contained in approximately 339 million guest records globally had been exposed (7 million related to UK residents).

What Does This Mean For Your Business?

We’re now seeing the culmination of ICO investigations into incidents involving some large organisations, and the issuing of some large fines by the ICO e.g. British Airways and Marriott International, and also some lesser-known, smaller organisations – LPVL. These serve to remind all businesses of their responsibilities under GDPR.

Personal data is an asset that has real value, and therefore, organisations have a clear legal duty to ensure its security.  Part of ensuring this is carrying out proper due diligence when e.g. making corporate acquisitions (as with Marriott), when transferring data to partners (as with LPVL), and in all other situations.  Systems should be monitored to ensure that they haven’t been compromised and that adequate security is maintained.  Staff dealing with data should also be adequately trained to ensure that they act lawfully and make good decisions in data matters.

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