According to a recent report, there has been almost a 50 percent increase in reported data security breaches at businesses, government agencies and educational institutions since 2007. The financial losses to affected companies also have increased.

Surveyed companies reported that average data breach response and business costs rose in 2008, with a cost to the affected company of some $202 per affected consumer, an increase of nearly 40 percent since 2005.

To counter this trend, many states have enacted or strengthened privacy laws that have regulated, among other things, the display of Social Security numbers, encryption of sensitive consumer information, secure disposal of consumer data and the scourge of malware.

Beyond legislation, merchants and certain financial institutions that handle credit card transactions must also comply with the Payment Card Industry Data Security Standards (or PCI standards), industry standards promulgated by the major credit card brands that are a baseline of important security controls to safeguard sensitive cardholder data.

Read the full article