Data Security

The number of worldwide computer virus infections jumped 22 percent from Q1 to Q2 this year, according to the recently released “Trend Micro Q2 Virus Roundup.” Other data revealed by the study: ¥ North America leads the world in infections, with 6.2 million reported in Q2. ¥ Asia comes in a distant second, with about 2 million reported infections in Q2. ¥ Europe reported 1.8 million infections in Q2. ¥ Worldwide infections were down 16 percent from Q1 2004 to Q1 2005. Source: “Trend Micro Q2 Virus Roundup,” http://www.trendmicro.com/en/security/white-papers/overview.htm.

Consumers who’ve been notified that their personally identifiable information (PII) had been compromised are more than upset -- 59 percent of them either consider terminating or actually terminate their relationships with the offending corporations, according to a new consumer study sponsored by law firm White& Case. The survey, conducted by the respected privacy research organization Ponemon Institute, asked 10,000 adults what actions they took after their PII was mishandled: ¥ 58 percent said the breach decreased their sense of trust and confidence in the organization reporting the incident; ¥ 52 percent said the breach notices they received were difficult to understand; ¥ 40 percent

Are your contact center reps treating your customers in a way that best represents your brand? Are they staying within the confines of applicable laws when making upsell and cross-sell offers, especially those for third parties? Are you sure? Here’s why I ask: I ordered a home product from a catalog in July. I had previously ordered from this company with no problems. After taking my order, the contact center rep launched into a rambling, barely decipherable cross-sell offer of joining some third-party shopping club in which I could get discounts on other products not related to the catalog. I

“Privacy concerns are one of the major obstacles for the next level of adoption of the Web by online customers,” says Terry Golesworthy, president of The Customer Respect Group, a research and consulting firm. The company recently analyzed 464 major corporate Web sites to determine critical trends related to online customer privacy, and then ranked those companies. Here’s what it found: ¥ 23 percent of companies have policies that The Customer Respect Group termed “good” for allowing users to destroy their own information stored in corporate databases. ¥ 42 percent of companies scored”good” on their policies toward sharing of collected personal data. ¥ 64

Here’s a nightmare scenario: One Monday morning you look at the previous week’s sales numbers from your online channel, and your heart skips a beat. Sales were up 23 percent! Hooray! But within a few days your contact center starts getting calls from irate consumers wondering why you’ve charged their credit cards for items they never ordered. Your site has been tagged by Internet fraudsters using stolen credit card numbers. How could you have avoided this? By instituting fraud-detection best practices. Here are a few offered in the white paper”Buyers Guide: Best Practices for Internet Fraud Prevention,” available from ClearCommerce, a software solutions provider (www.clearcommerce.com). ¥

Cybercriminals broke into the computer systems at BJ’s Wholesale Club and and stole customer data. As a result, BJ’s faces about $13 million in private claims. And in its settlement with the Federal Trade Commission, BJ’s must submit to outside security audits for the next 20 years. Fraud costs the retail industry an estimated $1.5 billion annually, according to the National Retail Federation. Think technology will come to your rescue? Think again. In 2004, the Carnegie Mellon University CERT Coordination Center tracked 3,780 new computer security vulnerabilities, up from just 171 in 1995. The problem is getting worse, even with all of the

Seventy-five percent of consumers believe they have lost all control over how personal information is collected and used by companies, according to a recent Privacy& American Business survey, said James Koenig, co-leader of privacy practice for PricewaterhouseCoopers, in his session”Marketing in a Privacy-Sensitive World” at Direct Marketing Days New York held last month. Following are a few tips Koenig offered to manage internal communication to better protect your customers’ data: * Implement a marketing oversight management process. “All marketing programs and campaigns should be reviewed quarterly,” said Koenig. Representatives from each distribution channel should be included. The process should be used as a tool to reinforce

If you gather employees’ personal information from credit reports you now are required to destroy the data before discarding of it, according to regulations that went into effect earlier this month. The Fair and Accurate Credit Transactions Act, which was passed by Congress is December 2003, states that employers must shred or burn paper documents or “smash or wipe” computer disks that have the employees’ information. This refers only to data you’ve collected on employees by running credit reports on them. According to a report in USA Today (“Employers must shred personal data,” June 1, 2005), the regulations are part of governmental efforts to reduce identity

A federal bill recently introduced in the U.S. Senate by Diane Feinstein (D-Calif.) would require any institution that owns, licenses or collects personal information to notify the individuals to whom the information belongs if those data are believed to have been acquired by an unauthorized person. Given both the recent flurry of this type of legislation and data breaches at a number of institutions in recent months, Jerry Cerasale, senior vice president of government affairs for The Direct Marketing Association, offered the following advice at his session “Legislation and Privacy Issues: Protect Your Company and Manage Your Risk” at the Annual Catalog Conference held last

Twenty-seven percent of consumers say a trusted online merchant should never share their personal customer information with a third party without the consumer’s express permission, according to “The Online Consumer Permissions Study,” a research report released by the Ponemon Institute earlier this year. In all, 1,799 consumers age 18 and older were surveyed. Other findings include: * 89% of consumers would approve of information sharing without their permission to improve the quality of services or products offered. * 84% to helped reduce incidents of identity theft. * 71% to conduct research that helps a company better understand its customers’ preferences. * 62% to provide product information or special