Are you controlling information disclosure? Exploring the causes, costs, and remedies for a data breach. This webinar will explore the causes and costs of data breaches, as well as ways to prevent and mitigate the impact that results from the inadvertent exposure of sensitive data. Attacks from the inside and outside of the network will be discussed, along with the various aspects of a data breach, including the types of data at risk and the variety of costs and impacts that an organization might incur. We will discuss a number of high profile breaches, including TJX, Heartland Payment Systems, Sony, and others. Costs from various industry reports will be presented, together with original statistical analyses from Risk Centric Security. The webinar will conclude with a discussion of cutting edge types of safeguards and controls, including integrated encryption-based rights management, egress filtering and control, and advanced malware detection and auto-remediation.

1. Risk Centric Security, Inc. Confidential and Proprietary .
Copyright © 2013 Risk Centric Security, Inc . All rights reserved.

2. Risk Centric Security is an acknowledged authority on the costs
and impacts of data breaches and other types of cyber-security
events. The Company offers state of the art SaaS tools, training,
and consulting that empower Information Security Professionals
to perform credible, defensible, and reproducible risk and
decision analyses, and to articulate the results and relevance of
these analyses in language that business counterparts will
understand.
Risk Centric Security, Inc. Confidential and Proprietary .
Copyright © 2013 Risk Centric Security, Inc . All rights reserved. Risk Analysis for the 21st Century®
Patrick Florer has worked in Information Technology and
Security for over 33 years. In addition, he worked a parallel
track in evidence-based medicine for 17 of those years. He is
the CTO and Cofounder of Risk Centric Security. In addition,
he is a Distinguished Fellow of the Ponemon Institute. Mr.
Florer graduated summa cum laude from the University of
Texas at Austin and is a member of the scholastic honor
society Phi Beta Kappa.

3. Deconstructing the causes and costs of a data breach:
• Threat Landscape
• Types of Data
• Types of Costs
• Breach Reports
• Frameworks, Bias and Correlation
• Breach Examples
• Closing Remarks
• Q & A
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5. 14% of data breaches / 69% of security
incidents caused by internal agents (Verizon
DBIR 2013)
33% of breaches in 18 companies studied
were caused by malicious insiders
(Ponemon/Symantec 2011 CODB – Mar, 2013)
21% of electronic crime events caused by
insiders (CERT 2011 Cybersecurity Survey)
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6. The actions of agents outside of an
organization that result in a data breach,
including:
Accidents
Negligence
Maliciousness:
Hacking
Phishing
Malware delivery
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7. 92% of data breaches / 31% of security incidents
caused by external agents (Verizon DBIR 2013)
76% of network intrusions exploited weak or stolen
credentials (Verizon DBIR 2013)
58% of electronic crime events caused by external
agents (CERT 2011 Cybersecurity Survey)
40% of breaches caused by malware (Verizon DBIR
2013)
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8. 55% - Organized Crime
21% - State affiliated agents
2% - activist/hacktivist
1% - former employees
21% - other or unknown
(all figures from Verizon 2013 DBIR
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9. 78% of initial compromises rated as low (68%) or very low
(10%) difficulty
73% of subsequent actions rated as low (71%) or very low
(2%) difficulty
22% of initial compromises rated as moderately difficult / 7%
of subsequent actions rate the same
<1% of initial compromises rated as highly difficult / 21% of
subsequent actions rate the same
Almost all moderate and highly difficult actions pertain to
espionage and NOT to organized crime.
(all figures from Verizon 2013 DBIR)
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11. Operational Data
Intellectual Property
Financial Information
Personally Identifiable Information (PII)
Protected Health Information (PHI)
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13. • Breached entity?
• Shareholders?
• Citizens / the public at large?
• Card brands?
• Issuing banks?
• Customers?
• Business partners?
• Consumers?
• Taxpayers (law enforcement costs)?
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14. Fixed / Overall Costs
Per record costs:
• Direct/Primary
• Indirect/Secondary
• Variable costs that scale with magnitude of
breach
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15. Costs that we should be able to discover and/or estimate:
• Lost productivity
• Incident response and forensics costs
• Costs of replacing lost or damaged hardware, software, or
information
• Public relations costs
• Legal costs
• Costs of sending letters to notify customers and business
partners
• Costs of providing credit monitoring
• Fines from governmental action (HIPAA/HITECH, FTC, State
Attorneys General, etc.)

16. Costs that we should be able to discover and/or
estimate:
• Fines and indemnifications imposed by contracts with
business partners
• Contractual fines and penalties resulting from PCI DSS
related incidents - either data loss or compliance failure
• Judgments and legal settlements - customers, business
partners, shareholders
• Additional compliance and audit costs related to legal
settlements (20 years of additional reporting, for example)
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17. Costs that might be difficult to discover and/or
estimate:
• Loss of competitive advantage
• Loss of shareholder value
• Reputation loss
• Opportunity and Sales losses from customers and
business partners who went elsewhere
• Value of intellectual property
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18. Ponemon Institute 2011 Cost of Data Breach Study:
United States (March, 2013)
49 Companies surveyed – multiple people per company.
Breach sizes ranged from 5K – 100K exposed records.
Participants estimated the minimum and maximum
amounts for a number of costs, from which the mid-point
value was selected.
According to some legal experts, Ponemon Institute
numbers are the “gold” standard in the Federal Courts.
The raw data are published in the report appendix.
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19. In the 2011 report:
Overall weighted average per record = $194 (down from $214
in 2010)
Overall average total = $5.5 M (down from $7.2M in 2011)
Minimum total cost = $566 K
Median total cost = $4.5 M
Maximum total cost = $20.9 M
Risk Centric Security, Inc. Confidential and Proprietary .
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20. Ponemon Institute 2013 Cost of Cyber Crime Study:
United States
56 Organizations Companies surveyed, > 1,000 seats
Costs were due to cyber crime – no errors or accidental
exposures
4 week study period extrapolated to 52 weeks.
The 56 organizations in the study experienced 102 cyber
attacks per week; 1.8 attacks each per week.
Annualized costs per company ranged from $1.4M to
$46M, with the average = $8.9M and the median = $6.2M
Average attack took 24 days to resolve and cost $592K
Risk Centric Security, Inc. Confidential and Proprietary .
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21. Net Diligence 2013 Cyber Liability & Data Breach
Insurance Claims study
137 events between 2009 and 2011 – claims data were
provided by underwriters
Average cost per breach = $3.7 million
Payouts were net of deductibles/retentions, which ranged
from $50K to $1M
Report breaks out many types of costs: Crisis services,
Legal Defense, Legal Settlements
Cyber insurance does not reimburse for “soft” costs like
lost customers, brand damage, and lost stock value.
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23. TJX
Heartland
Sony
Global Payments
Department of Revenue of South Carolina

24. Plans for the Presidential Helicopter
Coca-Cola
Merger Acquisitions
Insider Threat
Ford Motor Company

25. Measured on a per record basis, the cost per record
declines as the size of the breach increases
Measured on a total cost basis, the total cost increases
as the number of exposed records increases
Both of these correlations are weak
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26. Risk Centric Security, Inc. Confidential and Proprietary .
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27. Risk Centric Security, Inc. Confidential and Proprietary .
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28. We have covered many topics today. To summarize:
• Data breaches are caused by threats from the
inside and threats from the outside.
• Data breaches are caused by accidents, negligence,
and maliciousness.
• Data breaches involve many types of data.
• Data breaches involve many types of costs.
• There are many useful preventative technologies.
• There are many effective technologies for breach
detection and mitigation.
Risk Centric Security, Inc. Confidential and Proprietary .
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29. Watchful Software is focused on providing data-centric
information protection that works. With the massive amounts
that have been invested in securing the network perimeter, one
thing has become painfully clear: today's enterprises must secure
the information itself.
Charles Foley is the Chairman and CEO of Watchful Software, Inc.
Mr. Foley has over 20 years experience leading both private and public company teams
to success. Prior to Watchful Software, Mr. Foley was the Chairman and CEO of
TimeSight Systems, Inc., a developer of leading-edge storage and video management
solutions for the physical security market. He also served as President of Tacit Networks,
Risk Centric Security, Inc. Confidential and Proprietary .
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a leader in Wide Area Network acceleration systems,
where he designed the marketing and business
development strategies that led to their profitable
acquisition by Packeteer (NASDAQ: PKTR).

30. Risk Centric Security, Inc. Confidential and Proprietary .
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Heather Goodnight is the Regional Sales director for
Triumfant, Inc. She is one of the most accomplished
business and sales development professionals working in
the information security space. By focusing on customers’
business needs and aligning products and services, she
helps bring forth the benefits of successful selling
fundamentals and best practices that positively impact
bottom-line results.
Triumfant leverages patented analytics to detect, analyze and remediate the
malicious attacks that evade traditional endpoint protection solutions such
as the Advanced Persistent Threat, Zero Day Attacks, targeted attacks, and
rootkits. Triumfant automates the process of building a contextual and
surgical remediation that addresses the malware and all of the associated
collateral damage. Endpoints go from infection to remediation in five
minutes without the need to reboot or re-image.

31. Thank you !
Patrick Florer, CTO and Co-founder
Risk Centric Security, Inc
patrick@riskcentricsecurity.com
214.828.1172
Heather Goodnight, Regional Sales Director
Triumfant, Inc.
heather.goodnight@triumfant.com
214.405.5789
Charles Foley, Chairman and CEO
Thomas McClinton, Central US Sales Director
Watchful Software, Inc.
thomas.mcclinton@watchfulsoftware.com
832.754.8501
Risk Analysis for the 21st Century®