Yahoo! fined after systemic failures put customer data at risk

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Yahoo! UK

Yahoo! UK Services Limited has been fined £250,000 by the Information Commissioner’s Office (ICO) following a cyber-attack in November 2014. The incident was publicly disclosed in September 2016, almost two years after it had taken place.

Because of when the breach happened, the ICO’s investigation was carried out under the Data Protection Act 1998.

It considered the circumstances under which the personal data of approximately 500 million international users of Yahoo!’s services was placed at risk. In particular, the ICO focused on the 515,121 UK accounts, that Yahoo! UK Services Limited – based in London – had responsibility for as a data controller.

The compromised personal data included names, email addresses, telephone numbers, dates of birth, hashed passwords, and encrypted or unencrypted security questions and answers.

ICO Deputy Commissioner of Operations, James Dipple-Johnstone, said: “People expect that organisations will keep their personal data safe from malicious intruders who seek to exploit it.

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“The failings our investigation identified are not what we expect from a company that had ample opportunity to implement appropriate measures, and potentially stop UK citizens’ data being compromised.”

The ICO considered the breach to be a serious contravention of Principle 7 of the Data Protection Act 1998, which states that appropriate technical and organisational measures must be taken against unauthorised or unlawful processing of personal data.

Dipple-Johnstone continued: “Cyber-attacks will happen, that’s just a fact, and we fully accept that they are a criminal act. But as the intruders become more sophisticated and more determined, organisations need to make it as difficult as possible for them to get in. But they must also remember that it’s no good locking the door if you leave the key under the mat.”

Since the ICO investigation, data protection law has changed. The EU’s General Data Protection Regulation (GDPR) came into effect on 25 May 2018.

Dipple-Johnstone added: “Under the GDPR and the new Data Protection Act 2018, individuals have stronger rights and more control and choice over their personal data. If organisations, especially well-resourced, experienced ones, do not properly safeguard their customers’ personal data, they may find customers taking their business elsewhere.”

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