Data theft arrest reminds businesses to upgrade security

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    Employers are being given a stark reminder to protect themselves from former employees stealing data and using it to help a rival business.

    The warning follows a case in which an adviser was arrested and questioned by police over allegations of taking client information after she had resigned from her job.

    Victoria Leigh is a data security specialist at the international law firm Hammonds, she said, "this case is yet another in a long line of high-profile examples of data theft, loss and misuse which highlights that businesses must have robust security measures in place or risk facing blows to their bottom line as well as potential regulatory sanctions. Although it is an extreme example, this case shows just how serious it can be for an employee who unlawfully obtains personal data."

    If a former employee has taken confidential information before leaving the company, such as pricing or customer lists, the advice is always for a business to act quickly to protect its position.

    Leigh continues, "If you think a former employee has stolen data and you want to take action to prevent its use or retrieve it, a hunch is insufficient. You need good, strong evidence and the ability to able to identify exactly what was removed, when and by whom. Constructing an audit trail is always a good way to confirm the misappropriation. Or if you can prove that your customers or suppliers have been approached by your former employee they may be willing to give evidence to support your claim."

    "It is also important to check their employment contract to see if there may be restrictive covenants which apply. If they do, you will need to identify what they cover; how long they endure; and whether they are limited by geographical area. Since the law on what constitutes a valid and enforceable restrictive covenant is complex specialist legal advice must be obtained."

    In some cases of data theft the potential damage to a business can be viewed as sufficiently serious to justify an application for an injunction but, it must be stressed that injunctions are difficult and expensive to obtain.

    "Data protection theft can be very damaging to a business since it can have a substantial financial impact that may be difficult to prove. In addition the reputational consequences are equally hard to define" concludes, Leigh.

    For further information contact:

    Kath Paddison, Communications Manager, Hammonds LLP, on 0161 830 5289 or email: katherine.paddison@hammonds.com

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