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UK’s watchdog ICO is all set to fine British Airways more than £183m over a customer data breach. In September last year, British Airways notified ICO about a data breach that compromised personal identification information of over 500,000 customers and is believed to have begun in June 2018. ICO said in a statement, “Following an extensive investigation, the ICO has issued a notice of its intention to fine British Airways £183.39M for infringements of the General Data Protection Regulation (GDPR).”

Information Commissioner Elizabeth Denham said, “People’s personal data is just that – personal. When an organisation fails to protect it from loss, damage or theft, it is more than an inconvenience. That’s why the law is clear – when you are entrusted with personal data, you must look after it. Those that don’t will face scrutiny from my office to check they have taken appropriate steps to protect fundamental privacy rights.”

How did the data breach occur?

According to the details provided by the British Airways website, payments through its main website and mobile app were affected from 22:58 BST August 21, 2018, until 21:45 BST September 5, 2018.

Per ICO’s investigation, user traffic from the British Airways site was being directed to a fraudulent site from where customer details were harvested by the attackers. Personal information compromised included log in, payment card, and travel booking details as well name and address information. The fraudulent site performed what is known as a supply chain attack embedding code from third-party suppliers to run payment authorisation, present ads or allow users to log into external services, etc.

According to a cyber-security expert, Prof Alan Woodward at the University of Surrey, the British Airways hack may possibly have been a company insider who tampered with the website and app’s code for malicious purposes. He also pointed out that live data was harvested on the site rather than stored data.

RiskIQ, a cyber security company based in San Francisco, linked the British Airways attack with the modus operandi of a threat group Magecart. Magecart injects scripts designed to steal sensitive data that consumers enter into online payment forms on e-commerce websites directly or through compromised third-party suppliers. Per RiskIQ, Magecart set up custom, targeted infrastructure to blend in with the British Airways website specifically and to avoid detection for as long as possible.

What happens next for British Airways?

The ICO noted that British Airways cooperated with its investigation, and has made security improvements since the breach was discovered. They now have 28 days to appeal. Responding to the news, British Airways’ chairman and chief executive Alex Cruz said that the company was “surprised and disappointed” by the ICO’s decision, and added that the company has found no evidence of fraudulent activity on accounts linked to the breach. He said, “British Airways responded quickly to a criminal act to steal customers’ data. We have found no evidence of fraud/fraudulent activity on accounts linked to the theft. We apologise to our customers for any inconvenience this event caused.”

ICO was appointed as the lead supervisory authority to tackle this case on behalf of other EU Member State data protection authorities. Under the GDPR ‘one stop shop’ provisions the data protection authorities in the EU whose residents have been affected will also have the chance to comment on the ICO’s findings. The penalty is divided up between the other European data authorities, while the money that comes to the ICO goes directly to the Treasury.

What is somewhat surprising is that ICO disclosed the fine publicly even before Supervisory Authorities commented on ICOs findings and a final decision has been taken based on their feedback, as pointed by Simon Hania.

Record breaking fine appreciated by experts

The penalty imposed on British Airways is the first one to be made public since GDPR’s new policies about data privacy were introduced. GDPR makes it mandatory to report data security breaches to the information commissioner. They also increased the maximum penalty to 4% of turnover of the penalized company.

The fine would be the largest the ICO has ever issued; last ICO fined Facebook £500,000 fine for the Cambridge Analytica scandal, which was the maximum under the 1998 Data Protection Act. The British Airways penalty amounts to 1.5% of its worldwide turnover in 2017, making it roughly 367 times than of Facebook’s. Infact, it could have been even worse if the maximum penalty was levied;  the full 4% of turnover would have meant a fine approaching £500m.

Such a massive fine would clearly send a sudden shudder down the spine of any big corporation responsible for handling cybersecurity – if they compromise customers’ data, a severe punishment is in order.

Carl Gottlieb, Privacy Lead & Data Protection Officer at Duolingo has summarized the factoids of this attack in a twitter thread which were much appreciated.

  • GDPR fines are for inappropriate security as opposed to getting breached. Breaches are a good pointer but are not themselves actionable. So organisations need to implement security that is appropriate for their size, means, risk and need.
  • Security is an organisation’s responsibility, whether you host IT yourself, outsource it or rely on someone else not getting hacked. The GDPR has teeth against anyone that messes up security, but clearly action will be greatest where the human impact is most significant.
  • Threats of GDPR fines are what created change in privacy and security practices over the last 2 years (not orgs suddenly growing a conscience). And with very few fines so far, improvements have slowed, this will help.
  • Monetary fines are a great example to change behaviour in others, but a TERRIBLE punishment to drive change in an affected organisation. Other enforcement measures, e.g. ceasing processing personal data (e.g. ban new signups) would be much more impactful.

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Content Marketing Editor at Packt Hub. I blog about new and upcoming tech trends ranging from Data science, Web development, Programming, Cloud & Networking, IoT, Security and Game development.