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June 26, 2017

Anthem Agrees to Largest Data Breach Settlement in History

A settlement has been reached in the class action lawsuit against Anthem Inc. for a 2015 data breach that impacted almost 80 million Americans. In the breach, hackers stole customers’ Social Security numbers, addresses, birthdays, income data and employment information.

Both parties have agreed for Anthem to pay $115 million in damages, making it the largest data breach settlement in history. The funds will be put toward credit monitoring services and customer reimbursement.

At this point, the settlement is pending court approval. A hearing will take place in August to discuss the next steps.

Unfortunately for Anthem, the case is far from over as there are still many questions that need to be addressed about the company’s cybersecurity history and knowledge about the incident.

It’s a reminder that data breach investigations can last for years. They don’t disappear overnight. And they can hurt a business in a variety of ways, including:

Negative press: Consider the long term damage that comes with a data breach. Once a data breach is announced, it becomes a major news item. And as the above example shows, it refreshes every time there is an update.

Wasted resources: According to CyberScoop, Anthem will have to pay $38 million in attorneys’ fees. This money could have otherwise been allocated into programs that spur business development.

Backtracking: A data breach investigation requires a great deal of digging for information, internal questioning and stress. It can get very messy, too, especially once fingers start getting pointed and someone needs to take responsibility. Ultimately, it’s a giant distraction that can eat into team morale and divert attention away from the business’s most important goals.

Anthem, it should be noted, isn’t the only company that has had to deal with these types of issues.

For example:  

CoPilot: On June 15, CoPilot Provider Support Services agreed to a settlement with the New York attorney general for $130,000 in penalties following a 2015 breach.

Neiman Marcus: On June 21, Neiman Marcus Group LLC agreed to a class action settlement for $1.6 million after a 2013 data breach.

Target: After a massive data breach in 2013 that spanned across 47 states, Target Corp ultimately agreed to a whopping $18.5 million settlement.

So as you can see, a data breach is a serious incident that can forever scar a brand’s reputation. Businesses are strongly advised to take precautionary measures to avoid this type of costly experience.

Apex Technology Services is a managed services provider (MSP) offering comprehensive cybersecurity assistance to businesses in the greater New York City area and beyond. Apex can provide security audits, ongoing maintenance, guidance and support and rapid-response troubleshooting.

To learn more about Apex, click here.

A new breed of hacktrepeneurs has awoken and they have little to fear and everything to gain by infecting as many companies as possible and extorting money from them. Apex Technology Services stands ready to protect your company regardless of whether it’s located in New York CityWhite Plains, New York; Connecticut; Australia; Europe; or anywhere else. Our full suite of cybersecurity and IT support services is at your disposal, enabling you to spend less time worrying about and more time growing your business.

To ensure your security, consider one of our most popular services — Auditing & Documentationwhich pinpoints vulnerabilities in your infrastructure, process flow and internal security procedures.

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