What Are Security Breaches?

For many people, life’s most fundamental activities are now conducted online. From shopping, banking, and travel planning to entertainment and dating, people increasingly turn to the digital realm to facilitate their public and private lives. They trust their digital tools to keep personal information and data—and perhaps some of their secrets—safe, private, and protected. 

However, as online accounts, applications, and computer systems now store vast amounts of personal and financial information, they become prime targets for security breaches in which criminals seek to compromise systems to gain access to customer accounts and harvest data, opening the door for fraud and other cybercrimes. For businesses, breaches can also lead to regulatory fines, legal liabilities, reputation damage, and loss of customer trust. 

A security breach can result from a wide range of evolving threats and vulnerabilities, including weak passwords, malware, phishing, ransomware, and social engineering. Instituting data security measures are imperative for both individuals and organizations to protect personal privacy and safeguard sensitive data, because confidential information has great value to criminals. The dark web is a marketplace where usernames, passwords, credit card numbers, and other financial data can be bought and sold, and employed for the purposes of identity theft or fraud.

The threat of security breaches is real: According to Enterprise Apps Today, every 39 seconds a breach occurs somewhere in the world, with an estimated $6 trillion in damages caused by cybercriminals in 2022 alone.

Security breaches result when security controls are penetrated or otherwise circumvented; the world’s largest and most powerful companies are regularly targeted by cybercriminals. In fact, financial institutions, e-commerce companies, and government agencies are among the most commonly targeted entities due to the vast troves of personal and financial data that these sites maintain.

Individuals and organizations both large and small are at risk of security breaches and cyberattack. Hackers and cybercriminals, some with the backing of powerful national or corporate interests, are endlessly inventive and come up with new ways to penetrate existing security protections. This gives them the opportunity to steal sensitive information or personal data that they can potentially sell or manipulate for competitive gain, or to use to engage in fraud, identity theft, or spreading misinformation. 

According to the news site secureworld.io, the most significant data breaches of all time include the following:

• Yahoo (2013-2014), in which over 3 billion user accounts were compromised after attackers used phishing techniques to break into Yahoo’s network. Intruders gained access to sensitive information including names, email addresses, birthdates, phone numbers, and encrypted passwords. In addition to fines of $35 million from the Securities and Exchange Commission and $80 million in settlements from a federal securities class action suit, Yahoo was forced to reduce its purchase price by $350 million during its sale to Verizon in 2016. In March 2017, the FBI indicted four people for the attack, including two officers of the Russian Federal Security Service (FSB).
• Equifax (2017), in which attackers gained the personal information of 147 million consumers in the U.S., including names, Social Security numbers, birthdates, addresses, and in some cases, driver's license numbers. In addition to this personal information, the breach also exposed credit card numbers of around 209,000 customers. Attackers gained access to the Equifax network through a website application vulnerability,  and inadequate system segmentation allowed the infiltrators easy lateral movement within the system. The breach had severe repercussions, leading to a loss of consumer trust, legal investigations, lawsuits, regulatory fines, and congressional hearings. Equifax also paid an estimated $700 million to help people affected by the data breach. In 2020, the U.S. Department of Justice announced charges against four Chinese military-backed hackers in connection with the Equifax cyberattack. 
• Marriott International (2014-2018), in which approximately 500 million guest records were compromised, including names, addresses, phone numbers, passport numbers, email addresses, travel information, and, in some cases, payment card numbers. The attack initiated when Marriott acquired Starwood Hotels and Resorts in 2016 and integrated Starwood’s reservation system into Marriott’s. Starwood’s system had been compromised by at least 2014 (likely from credentials stolen from Starwood employees) and soon all properties in the Marriott International group were infected. The UK Information Commissioner’s Office (ICO) fined Marriott $23.8 million in penalties. U.S. officials claim the cyberattack was part of a Chinese intelligence-gathering effort; Marriott is the top hotel provider for American government and military personnel.
• T-Mobile (2022-2023), in which attackers manipulated an API to breach 37 million user accounts to obtain customer names, billing addresses, email addresses, phone numbers, account numbers, and birth dates. The attacker, who had unauthorized access to T-Mobile's systems for over a month before the breach was discovered, has not been identified. 

There are multiple types of security breaches, characterized by the methods used by the attacker to gain access to the system. 

• Malware attacks are a common technique used by criminals to launch security breaches. Malware is often spread through malicious email attachments, often as part of a phishing attack that tricks recipients into clicking on links or downloading attachments that contain malware or lead to fake login pages. Malware can also be launched through contact with infected websites or compromised software downloads. Malware can be designed to perform various functions that lead to data breaches, including recording keystrokes or monitoring user activity, or creating “backdoor” access points that allow attackers to gain access to networks. Other types of malware can harvest saved login credentials or steal sensitive authentication data, which attackers can use to gain unauthorized access to accounts and systems. Malware can also perform exfiltration, sending stolen data to remote servers controlled by attackers, leading to unauthorized data leakage and potential exposure. Ransomware attacks can also lead to security breaches, as ransomware is a type of malware that encrypts a victim's data, rendering it inaccessible. During the encryption process, the attacker gains access to the victim's data, and in many cases, threatens to release the victim's sensitive data publicly or sell it on the dark web if the ransom is not paid. This turns the ransomware incident into a data breach, exposing the compromised information to unauthorized individuals.
• Social engineering attacks rely on psychological manipulation to deceive people into revealing sensitive information, performing actions, or making decisions that compromise security. In some cases, attackers may impersonate trusted individuals, such as colleagues, supervisors, or IT personnel, to convince victims to share sensitive data or reveal usernames, passwords, or other authentication credentials. Using this information, attackers can gain unauthorized access to systems, accounts, and sensitive data. Social engineering attacks often use phishing tactics to manipulate individuals into performing actions or revealing data that they normally wouldn’t.
• Software exploits take advantage of vulnerabilities or weaknesses in software, firmware, or system configurations to gain unauthorized access, manipulate data, or perform malicious actions within a computer system or network. Outdated or unpatched software is a common entry point for system exploits, but they can also be linked to privilege escalation attacks or remote code execution exploits.

The penalty for a data breach can be severe and far-reaching, and include:

• Financial losses, due to expenses related to incident response, legal fees and lawsuits, regulatory fines, and compensation to affected parties.
• Reputational damage, as publicly disclosed breaches can result in negative publicity and cause long-term damage to a brand.
• Loss of trust, as breaches can undermine confidence in the business's ability to protect data, making customers (and partners) hesitant to engage in commercial relationships, leading to loss of loyalty and customer attrition.
• Legal and regulatory implications, as businesses may face legal actions and regulatory fines due to non-compliance with data protection laws and regulations, such as the EU’s General Data Protection Regulation (GDPR) and the Health Insurance Portability and Accountability Act (HIPAA) in the U.S.

Recognizing the signs of a security breach early is crucial for minimizing potential damage and responding effectively. Following are common indicators that may signal a security breach is in progress. 

• Unusual network activity, such as sudden increases in network traffic, unusual data transfers, or unexpected spikes in bandwidth usage may indicate unauthorized access or data exfiltration.
• Unexpected system behavior, such as unexplained system downtime, slow performance, or frequent crashes might indicate the presence of malware or unauthorized activities. 
• Strange account activities, such as unfamiliar user accounts, unusual login times, or multiple failed logins can be signs of compromise or unauthorized access attempts. 
• Data anomalies and unauthorized access, such as missing or altered data and logs showing unauthorized access to critical databases or sensitive information, can suggest a security breach.

Preventing security breaches requires a proactive and comprehensive approach to cybersecurity, including the following best practices.

• Enforce strong password policies. Restrict the use of easily guessable information like birthdays, names, or common words and enforce the use of passwords which combine random strings of upper and lower-case letters, numbers, and symbols. Consider advocating the use of passphrases, which are longer and easy to remember but harder to crack.  
• Implement multi-factor authentication (MFA). MFA requires the user to present two or more verification factors to gain access to an application, resource, online account, or other service. In common practice, this often involves entering a one-time passcode from an email or text into a smart phone or browser, or providing biometrics such as a fingerprint or face scan.
• Regularly update software and systems. Keep operating systems, software applications, and security patches up-to-date to address known vulnerabilities. Develop a robust patch management process to apply security updates and fixes promptly.
• Implement network segmentation. Dividing a larger network into smaller, isolated segments can help enhance security and reduce the potential impact of security breaches by creating separate zones or subnetworks with controlled access. This practice helps isolate critical assets, reduces the attack surface, and limits lateral movement within the network to help contain breaches.
• Employ encryption and data protection. Encrypt sensitive data both in transit and at rest to protect against unauthorized access. Enforcing data protection policies such as strict access controls and least privilege principles reduce the risk of unauthorized data access.
• Inventory APIs and third-party scripts. Dynamically discover API endpoints and third-party integrations to ensure they are captured in risk management processes and protected by appropriate security controls. 

• Recognize phishing attempts. Be sure employees learn to recognize phishing emails and malicious links, reducing the likelihood of falling for phishing scams that can lead to data breaches.
• Educate about strong passwords. Teach employees the importance of strong passwords and robust password hygiene practices. 
• Report suspicious activities. Teach employees to promptly report suspicious activities or potential security incidents, enabling faster response and mitigation. Regular training keeps employees updated about emerging risks and how to recognize them.

• Regularly assess your organization's security posture. Use penetration testing, vulnerability scanning, and security audits to identify and address weaknesses in your systems, applications, and networks before attackers can exploit them. Vulnerability assessments also help identify misconfigurations that could lead to security breaches if left unaddressed.

• Develop an incident response plan. This can play a significant role in mitigating security breaches by providing a structured and proactive approach to identifying and responding to potential cybersecurity incidents.
• Identify stakeholders and roles. Be sure to identify stakeholders and determine roles and responsibilities, and develop a clear chain of command for reporting and escalating incidents. Develop detailed step-by-step procedures to contain and mitigate breaches, and regularly test the plan to identify weaknesses and improve responses.
• Develop business continuity and disaster recovery (BCDR) strategies. BCDR plans help ensure the continuation of critical business operations in the face of disruptions, such as security breaches. An essential element of BCDR plans is regular data backups to ensure that data can be restored to a previous, clean state in case of a data breach or data corruption. All BCDR plans must be regularly tested through drills and exercises to confirm their effectiveness, and to allow businesses to identify weaknesses and refine response strategies..

Artificial intelligence offers powerful new tools and capabilities that can be leveraged to detect and prevent security breaches. In particular, AI-powered bot defense can maintain resilience no matter how attackers try to circumvent defenses through durable telemetry collection, behavioral analysis, and shifting mitigation strategies. AI algorithms detect anomalies that can indicate breach activity, such as users accessing sensitive data at unusual times or from unfamiliar locations, as well as attempts to spoof signals and use compromised data from the dark web. 

These systems can be directed to automatically block or flag suspicious activities, and can automate some elements of incident response plans, such as initiating predefined response actions or isolating compromised systems to help minimize the spread of breaches. Because AI-based security systems learn from new data and adapt to changing threat landscapes, their accuracy at detecting breaches improves over time and evolves to stay relevant in dynamic threat environments. 

AI technologies can also analyze large volumes of data and detect anomalous patterns in real time, enabling these systems to respond faster and with more accurate threat identification than manual or rules-based threat detection programs.

While AI-driven security solutions offer significant benefits for threat detection and prevention, they work best in conjunction with human expertise to validate alerts and interpret complicated data or inputs. AI security models can produce false positives and false negatives, which require the vigilance of human judgement and oversight, particularly when responding to complex and novel threats. 

The Federal Trade Commission (FTC) provides guidance on incident response measures that organizations should consider when faced with a security breach. These steps are designed to help organizations effectively respond to and manage security incidents. An overview of FTC guidance for addressing a security breach includes the following actions:

• Secure your operations. Move quickly to secure your systems and mobilize your breach response team right away to prevent additional data loss. This might involve isolating affected systems, disabling compromised accounts, and taking other measures to prevent further unauthorized access.
• Fix vulnerabilities. Work with your forensics experts to identify and address the vulnerabilities that allowed the breach to occur. Patch and update software, systems, and configurations to prevent future incidents. Analyze who currently has access to the network (including service providers), determine whether that access is needed, and restrict access if it is not.
• Notify appropriate parties. Notify law enforcement to report the situation and the potential risk for identity theft. Depending on the nature of the breach, inform affected individuals, customers, or clients about the incident. Provide clear, accurate, and transparent information to affected individuals about what happened, what data was exposed, and what steps they should take to protect themselves.