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The Dangers of Using Unsecured File-sharing Methods and How to Avoid Them

In today’s digital age, the ability to share files quickly and efficiently is a crucial part of many organizations’ operations. However, it is also essential to ensure that the process of sharing files is secure to protect sensitive information and prevent data breaches.

77% of businesses have experienced a data breach as a result of insecure file-sharing practices. (Symantec, 2017)

This article examines the dangers of using unsecured file-sharing methods and how best to avoid them. Watch a short, animated story from Kitetoons about unsecure file sharing and how it can cost companies a fortune.

What Is Unsecured File-sharing Methods?

Unsecured file-sharing methods are methods of sharing files that require adequate security measures to protect the transmitted data, but instead, have little to no security applied to the transmission. Unsecure methods may include sending files via standard email or unencrypted file-sharing platforms.

Why Are Unsecured File-sharing Methods Dangerous?

88% of businesses believe their current file-sharing methods are secure, but only 44% have tested their security. (Ipswitch, 2018)

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There are several risks associated with using unsecured file-sharing methods:

1) Data Breaches: When an unauthorized party accesses, discloses or steals sensitive, confidential, or protected data, an organization or an individual has suffered a data breach. It can occur through various means, such as hacking, phishing attacks, a lost or stolen device, or malware.

Here is an example of a data breach:

Nearly every organization stores its customers’ personally identifiable information (PII), such as names, addresses, and credit card numbers, in a database. Suppose one day a hacker manages to access this database and steals customers’ PII, the hacker then sells this PII on the dark web or uses it to commit identity theft or other fraudulent activities.

This is a prime example of a data breach, as the hacker accessed and stole sensitive data they were not authorized to access. The organization that suffered the data breach is now confronted with several issues. It will likely face penalties and fines by regulators for violating data privacy laws. The organization will also likely lose customers to more secure competitors, impacting its revenues, profits, and brand recognition. Last, but certainly not least, the organization will be the subject of several lawsuits filed by customers, citing financial hardship and other claims.

2) Loss of Control: Loss of control occurs when the organization can no longer function efficiently. It can occur in various contexts, such as the loss of control over personal data, the loss of control over a project or process, or the loss of control over a physical asset.

63% of employees use unapproved file-sharing methods, such as personal email or consumer-grade file-sharing services, to share business files. (Verizon, 2018)

Here is an example of loss of control:

Imagine that a company has a fleet of delivery trucks that it uses to transport goods to customers. One day, the company discovers that one of its delivery drivers has been using the vehicle for personal errands, such as picking up groceries or driving to the beach. The company has a policy prohibiting this behavior, which could lead to wear and tear on the truck and increase the risk of accidents.

Despite the company’s efforts to stop the driver from using the truck for personal purposes, the driver continues to do so. In this scenario, the company has lost control over the use of the truck and its driver for not following the company’s rules and policies. This loss of control could lead to various, costly problems, such as damage to the truck, increased maintenance costs, and potential liability in the event of an accident.

3) Noncompliance With Regulations: Noncompliance with regulations refers to the failure to adhere to laws, rules, or standards that have been put in place by a governing body or authority. Noncompliance can have various consequences, such as fines, legal action, and damage to an organization’s reputation.

Here is an example of noncompliance:

Many companies must store customer data securely, according to industry regulations like HIPAA and GDPR. Suppose a company decided to keep this data on an unencrypted server, believing it would be more convenient for its employees. Now suppose a hacker manages to gain access to the server and steal the customers’ data, like credit card numbers or bank account information. The company failed to store the data securely as required and is therefore in noncompliance with the relevant regulations due to the data breach. The company will very likely face fines, legal action, and damage to its reputation due to its noncompliance.

4) Reputational Damage: Damage to reputation refers to the negative impact that a situation or event can have on an individual’s or organization’s reputation or image. It can occur from negative publicity, customer complaints, litigation, or, of course, a data breach. Reputational damage can have significant financial consequences, including customer loss, litigation, canceled contracts, and more.

69% of businesses have experienced data loss due to employees using unapproved file-sharing methods. (Verizon, 2018)

Here is an example of reputational damage:

Suppose a company is known for producing high-quality products and providing excellent customer service. However, one day the company releases a new product that doesn’t work the way it was intended or breaks after limited use. The company receives many negative reviews and customer complaints, and the media widely covers the issue. The company’s reputation is damaged due to the faulty product and the negative publicity, leading to decreased sales and customer trust. The company may also be sued and found at fault for the problems with the product. In this scenario, the company’s reputation has been damaged, and the consequences have a short- and long-term impact on its business.

78% of businesses have experienced a data breach due to team member error, such as sharing files with the wrong person or using weak passwords. (Symantec, 2017)

There are several steps organizations can take to avoid the dangers of using unsecured file-sharing methods. Here are a few examples:

  1. Use Secure File-sharing Platforms: There are many specific file-sharing platforms available that offer a range of security measures, such as encryption, password protection, and the ability to set up secure file links with expiration dates. Using these platforms, you can protect the files containing your most sensitive information whenever they’re shared.
  2. Encrypt Your Files: If you need to share files via email or other unencrypted methods, you can still encrypt the files to add an extra layer of security. Many tools are available for encrypting files, and most modern operating systems also have built-in encryption capabilities.
  3. Use Strong Passwords and Multi-factor Authentication: Strong passwords and multi-factor authentication (MFA) can help to protect your accounts and prevent unauthorized access to your files. Make sure to use unique, complex passwords for all your systems and applications, and consider implementing MFA to add an extra layer of security, especially when sending sensitive files outside your organization.
  4. Train Your Employees: It’s essential to ensure that all employees in your organization know the importance of secure file-sharing practices. Regular training on strong password use and the dangers of sharing files via unsecured methods can help ensure that all employees follow the best rules.

In conclusion, secure file sharing is essential for protecting sensitive information and preventing data breaches. When organizations use secure file-sharing platforms, they protect their data during the sharing process. They also have likely adopted robust security protocols, such as encryption and multi-factor authentication, for further protection.

By taking these steps, organizations can protect their sensitive data and maintain the trust of customers, partners, and other stakeholders.

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