Canada: Ashley Madison Security Breach: Lessons Learned And Valuable Recommendations For All Businesses

On August 22, 2016, the Office of the Privacy Commissioner of Canada (the "OPC") released an important report regarding the Ashley Madison data breach, which exposed the personal information of some 32 million users of the online dating website marketed to people who are married or in committed relationships. As part of its investigation, held jointly with the Australian Information Commissioner, the OPC raised a number of issues regarding the security practices of Ashley Madison's parent company, Avid Life Media ("ALM"). In its report, the OPC examined the circumstances of the data breach and considered ALM's information handling practices that may have affected the likelihood or the impact of the data breach. In a section entitled "Takeaways for all Organizations," the OPC raised a number of key elements and recommendations for all organizations subject to the federal Personal Information and Electronic Documents Act (PIPEDA), especially those that collect, use or disclose potentially sensitive personal information. We selected and addressed some of these key takeaways in the following sections:

1. Harm Extends Beyond Financial Harm

At the outset, the OPC interestingly noted that harm can extend beyond financial harm or impacts. Very often, when managing a breach of personal information or incident, organizations work under the assumption that unless the information is health information or information that can lead to fraud or identity theft, the information at stake is not sensitive. As the OPC pointed out, while financial impacts are highly visible, they do not represent the entire extent of possible harm. There are usually two main types of potential harms: objective types of harm, such as financial harm, physical harm or discrimination, and more subjective types of harm, which include an emotional component, such as humiliation, embarrassment, etc. The OPC notes that reputational harm (which may be linked to both subjective and objective types of harm) can be extremely damaging and may have long-term effects on an individual's ability to access and maintain employment, relationships or safety, and can be difficult to remediate. It is therefore essential that organizations carefully consider all risks of harm and properly assess and mitigate these risks.

2. Safeguards Supported by a Coherent and Adequate Governance Framework

With respect to safeguards, many businesses and organizations put their focus on technology, leaving behind other important issues such as governance and corporate culture. As the OPC noted, in order to meet their obligations under PIPEDA, organizations that hold large amounts of personal information must have safeguards appropriate to, among other factors, the sensitivity and amount of information collected. While technological safeguards are important, they should be supported by an adequate information security governance framework in order to ensure that practices are appropriate with regards to the risks. This can be done by implementing policies and procedures, but also by way of employee training and by ensuring that practices are consistently understood and effectively implemented. In the case of ALM, the OPC concluded that the lack of such a governance framework was an "unacceptable shortcoming" that "failed to prevent multiple security weaknesses."

3. Charging a Fee for the Deletion of Personal Information

ALM's practice, prior to the security breach, was to charge a $19 fee for the "full deletion" of user profile information. While PIPEDA does not expressly prohibit the inclusion of a fee in order to have personal information deleted from an organization's databases, the OPC interestingly determined that there will be a high bar for the imposition of such a barrier to the exercise of an individual's privacy rights. More specifically, the OPC mentioned that the reasonableness of such a fee would have to be evaluated in light of factors such as the actual cost to the organization relative to the fee charged, as well as the likely influence it would have on the individual's decision on whether to withdraw consent. Moreover, even in cases where such a fee is reasonable, it would have to be clearly and conspicuously communicated prior to an individual providing consent. We rarely see organizations discussing this aspect in their privacy policy, so this takeaway will be useful for all organizations that may consider charging a fee for deletion of personal information.

4. Retaining Information Contained in Inactive or Deactivated Profiles

ALM's practice was to keep all the information contained in inactive or deactivated profiles indefinitely, in case an individual wished to reactivate their profile in the future. This was done despite the fact that 99.9% of ALM users who did reactivate their account did so within 29 days of deactivation. The OPC's takeaway makes it clear that organizations should have a data retention practice aligned with the documented typical or standard behaviour of their users. In other words, the retention policies should be based on a demonstrable rationale and timeline. For instance, it may potentially be reasonable to retain data for a longer period but only if it can be demonstrated that users will often come back within the relevant period of time, that users have been adequately informed of this practice prior to providing consent and signing up for the service, etc.

5. Email Verification

Upon subscription, ALM required that all registrants provide an email address. However, ALM did not verify the authenticity of the email addresses provided by the registrants. In this respect, the OPC mentioned that this lack of email address verification created unnecessary reputational risks for non-users — allowing, for instance, the creation of a potentially reputation-damaging fake profile using a real email address. Following the incident, non-users whose email addresses may have been released by the hacker and connected with ALM may be harmed and also have a claim against the organization for maintaining their personal information without their consent. This is a clear reminder that organizations that manage sensitive data and collect email addresses should implement an email verification process. It also highlights the risks for an organization of maintaining information which is not necessary, in breach of the data minimization principle.

6. Fake or Misleading Seals or Icons

Finally, many businesses display a seal or icon confirming or praising a certain level of quality or security. For instance, ALM was displaying, at the time of the breach, a fabricated "Trusted Security" icon, giving false assurances about the organization's security practices. The OPC observed in this respect that false or misleading statements, including fake or misleading seals or icons, may impact the validity of the consent obtained from users, as it may create false assurances which may materially influence an individual's decision to use a particular service.

Conclusion

Many businesses and organizations may initially not feel concerned with the Ashley Madison security breach, given that they do not manage personal information which is as sensitive as information about users interested in extramarital affairs. However, the takeaways and recommendations contained in the OPC report apply to all organizations. The OPC report sheds light on a number of issues affecting all businesses and organizations, such as the importance of taking the risk of subjective and reputational harm into account; the need to implement safeguards supported by an adequate information security governance framework; the risks associated with charging a fee for the deletion of user profile information; the issues pertaining to the long-term retention of information contained in inactive or deactivated profiles; the importance of email verification; and the impact of false or misleading seals, icons or statements on the validity of consent.

About BLG

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions