Desjardins estimates costs related to recent privacy breach at $70m
The $70 million in expenses related to costs incurred and the establishment of a provision with respect to the implementation of protections for members have been recognized in the second quarter of 2019.
Data protection issues may be costly, as just proven by Desjardins Group, whose report for the second quarter of 2019 includes an estimate of the costs associated with a recent privacy breach.
On June 20, 2019, Desjardins Group announced that some personal information of 2.9 million members had been shared with individuals outside the organization. Of these, 2.7 million are personal members and 173,000 are business members. This situation was caused by an ill-intentioned employee who has since been fired. Desjardins Group was not the victim of a cyberattack and its computer systems were in no way breached. AccèsD passwords (for both personal and business accounts), security questions and PINs were not compromised as a result of the leak.
In light of the situation, additional measures were put in place to protect the personal and financial information of all members and clients. Desjardins Group sent a letter to all members affected by the incident. It offers affected members, at its own cost, a credit monitoring plan and identity theft insurance with Equifax for five years.
In addition, on July 15, 2019, Desjardins Group announced to all its members that they are now automatically protected against identity theft. This protection is available not only to personal members, but also to business members, who are currently not served by any similar industry protection. This protection includes the following: the protection of assets and transactions at Desjardins Group, individual support in the identity recovery process in case of identity theft and coverage that will reimburse up to $50,000 for expenses related to identify theft.
The expenses related to costs incurred and the establishment of a provision with respect to the implementation of these protections for our members, totalling $70 million, have been recognized in profit or loss in the second quarter of 2019. Desjardins Group says it could periodically reassess this provision based on the circumstances.
