David Koch

What can small business owners learn from the Latitude Financial hack?

- March 28, 2023 2 MIN READ

Well, another week, another major financial institution that has been hacked. Yesterday, Latitude Finance publicly announced that the data of more than 14 million customers had been breached, and that’s bad news for everyone, but could it have been prevented? asks small business and financial expert, David Koch.

Astonishingly, approximately 7.9 million driver’s license numbers and 53,000 passport numbers were stolen in the attack. The company, which offers financial services to shoppers of various stores such as JB Hi-Fi, The Good Guys, and Harvey Norman, revealed that many records go back as far as 2005.

Millions and millions of Australians have had their data compromised… The ramifications of this data breach are still be revealed. But the big question is, could it have been prevented? And are our financial institutions and government regulators doing enough to ensure our data is safe?

And if the big guys can’t get it right, what hope is there for the rest of us? The Latitude attack is a great lesson for all of us in our own small business that making sure you have the right etiquette and protocol in protecting data of customers has got to be pushed right up the priority list. Why? Because the reputational damage, let alone any fines that you may receive for not keeping data of customers safeguarded, is just enormous.

How can you keep your customer’s data safe?

Keeping your customers’ confidential information safe may seem like a monummnetal task but it starts with asking the right questions. Investigate what safeguards you already have in place and find out what you can do better.

Make a simple checklist to ask your IT consultant about whether the firewalls are strong enough, whether you back up your data in the right way, and that you are ticking off their housekeeping so that you can, hand on heart legitimately say, I have IT processes that are, to the best of my knowledge, adequate to protect your database. The onus is on you. Because blaming the cyber crims and their sophistication really doesn’t cut it anymore.

How can the government help?

It’s not just small businesses, big businesses, or the banks that need to get this right. The government must as well. I think the biggest challenge for governments is to come up with an alternative way for us to prove our identities without having to offer up all our credentials like our passports, driver’s licences and bank account numbers. We’ve got to come up with a better way.

But it all starts with you protecting your database of customers, and we’ve got to put pressure on our business associations to take that debate higher to the government so we can come up with some decent regulations and strategies to stop this from happening.

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