small business

Cyber Attacks on Small Businesses Leave Lasting Damage

NBC 7 Responds looked at the impact of cybercrimes on small businesses

NBC Universal, Inc.

Cyber attacks are all too common in our modern world. There are hundreds reported each year, some of which leave devastating impacts on small businesses.

"This is not just affecting an individual or individual business," said Eva Velasquez of the Identity Theft Resource Center. "This is affecting our entire economy and our entire society."

Companies with fewer than 500 employees are considered small businesses by the Federal Government and the ITRC got hundreds of responses for their survey.

"Everybody is susceptible to it," said Tanya McAnear who owns Bad Madge & Company in South Park. "I think anybody can be hacked."

The data shows 58% of small businesses reported cyber or related security breaches. Of those businesses that had been hit, 75% had been hit at least twice.

McAnear says her business credit card has been hacked twice.

"This is very disturbing to us," said Velasquez.

The ITRC says the breaches hit small businesses very hard because they often don't have the money to put into good privacy practices. So when they are attacked, the recovery cost can be very expensive.

"It could be completely detrimental and could shut us down possibly," said McAnear. "That would be horrible."

Forty-four percent of small businesses said they paid between $250,000 and $500,000 to cover the losses after a breach. Another 16% paid between $500,000 and $1 million.

That's one reason why McAnear uses Square for customer purchases. Part of each transaction goes to pay for privacy protections.

"They either reduced resources or even reduced staff," said Velasquez. "WE have people who are losing their jobs over this issue."

Velasquez says businesses should take a look at what data they are storing. In most cases, it's employee data that was compromised. The ITRC says sometimes, businesses are storing too much information.

"Know what you have and then make decisions," said Velasquez. "Ask is it valuable for me to have this so I can provide assistance to my customers. If the answer is no, stop collecting it."

McAnear says small businesses need to stay alert at all times for cybercriminals.

"There are constantly people trying to do these scams all the time," said McAnear. "People want you to click a link and I never do that. I delete it immediately, block the caller. I even did that this morning."

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