UK firms gamble with customer data

Just under half of UK IT directors are breaking the Data Protection Act and putting customer data at risk, according to a study by IT management firm Compuware.

The report found that 44 of the 100 IT directors questioned use live customer information to test applications.

Such an action counts as 'using data for purposes other than those for which it was collected' and risks prosecution under the Data Protection Act.

As well as the legal implications, using live data also risks information being leaked to malicious sources.

"While 83 per cent of those surveyed are using non-disclosure agreements to control data usage when outsourcing, a lot of the time this doesn't mean anything to the outsourcers as it can be tough to communicate legal jargon to employees," said a Compuware spokesman.

"Selling confidential data can also pay a lot more than employees would normally earn in a month, so compared to the relatively small risk of being caught and prosecuted, a non-disclosure agreement is not going to mean very much."

Despite the Data Protection Act being passed in 1998, some 48 per cent of senior IT decision makers admitted to being only "vaguely familiar" with the legislation.

"Companies have had plenty of time to understand and implement robust data privacy measures since the Act was introduced eight years ago," said Ian Clarke, worldwide enterprise director at Compuware.

"Unless they have rigorous procedures in place, they run the risk of live data being leaked to third parties. This can have severe repercussions on customer confidence and company reputation, and will ultimately affect the bottom line."

Clarke pointed to laws in the US that force organisations publicly to d isclose when customer data has been leaked, and said that he expected similar legislation to follow in the UK at some point.

See also:

NHS slammed for ignoring mobile data security

Patient records and other sensitive data at risk  27 Jun 2006

Gartner warns multinationals over NSA data snooping

Consider ditching US service providers, says analyst  23 May 2006

Financial data theft up 410 per cent

Security firm reports huge surge in attacks over Easter weekend  22 Apr 2006

Novell targets data centre market

There's gold in big iron  13 Sep 2005

Mobile users clueless on data

Bad news for operators  07 Sep 2005

Home users rush for data protection

Opportunities abound in a growing market, reports analyst  30 Aug 2005

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