How secure is your data – and your reputation?

Aaaagh – my debit card has been ‘cloned’ for the second time in as many years! Thank goodness for the anti-fraud procedures in place at my bank. 

However, my attention, once heightened to all things identity and data-related, was then drawn to other banks and financial institutions that are being fined for ‘losing’ customers’ personal details in all sorts of situations. Recently one of the largest insurance companies was fined over £2m by the Financial Services Authority for losing 46,000 customers’ details (and not noticing for 12 months!).  It is only 12 months since the world’s largest global bank was fined a similar amount for losing a CD containing the details of 180,000 insurance customers.  These penalties sound pretty big to me, but are they severe enough for these major institutions? 

Well, if we start to consider the resulting impact on the organisation’s reputation and brand then the penalties may be much higher.  There are many different measurement systems out there now that look at tracking brand and organisational reputation, and one key area is stakeholder perceptions.  This loss of personal data is exactly the sort of crisis that shapes stakeholder perceptions and I imagine a number of opinions were shaken when news of these losses of data became known.

I was also interested to see the image that the newly opened Metro Bank was putting across recently.  They offer ‘Unparalleled levels of service and convenience’. They obviously feel that, in spite of the way that other retail banks try to portray themselves, there is a gap in the market that they can fill with this retro approach! 

Did I really just write that excellent customer service is retro???

Of course, it is not just the financial sector that is guilty in this respect – there have been cases of NHS files as well as data from government bodies going missing.

Do you know if your activities are legal in terms of data you store and use in your marketing activities? How big is the risk that you might lose customer data?

There is some useful information at www.cim.co.uk/legislation on how you can avoid some of these security issues in your organisation. Have a look at the articles and factfiles on Data Protection and Marketing and the Law. The website of the Information Commissioner’s Office is also a useful source of information www.ico.gov.uk .