Financial company faces million-dollar data breach lawsuit

On Behalf of | Sep 4, 2020 | Negligent Security Defense |

Individuals who entrust their private data to a major New York financial service typically expect that company to provide them with reasonable security that protects their information. However, when that trust is broken by a data breach, the financial institution may face a lawsuit filed by its former customers.

When a company fails to reduce the risk of data breaches, it may also lose its reputation and a serious loss in business when people no longer trust their personal data is safe within its servers.

Discarded equipment leads to breach

Bank Info Security notes that a former customer of the financial company filed the lawsuit in a New York court as a liaison for over 100 others affected by the breach. The court document alleges that the business failed to properly scrub sensitive information from computers before disposing of them. Names, passport information and Social Security numbers allegedly remained on the discarded equipment, which led to a sizable security breach. This was one of two incidents contained in the lawsuit.

Lost and missing servers caused additional leak

The million-dollar lawsuit also alleges that the financial company failed to locate servers and information discs containing sensitive information related to its customers after replacing equipment and that the information is not encrypted. This could cause further data loss and security failures if the machinery is found by individuals who might not have difficulty accessing the information it contains.

Company may have delayed report

The plaintiffs in this lawsuit allege that the security breach at the financial company was not reported in a timely manner. The defendant claims that as of this time, affected customers’ information remains uninvolved in any fraudulent activity. It remains unknown if the company involved is actively searching for the missing servers and software.

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