Prevent Data Theft from Departing Employees

When an employee leaves a company, data theft, and unauthorized file transfers all pose the same threat. Data theft can involve sensitive information such as client records and financial data. This threat exists regardless of whether an employee’s departure is voluntary or not.

Repercussions of data theft from insiders can be severe, leaving an organization’s most prized assets and secrets exposed. Such events can impact a company’s financial health through lost business and intellectual property. Furthermore, they can result in reputational damage, litigation, and regulatory fines.

Departing employees may have various motives for stealing sensitive data, such as a workers’ compensation claim gone wrong, gaining favor with a new employer, or it can even be a simple accident. Employers must be aware of the warning signs.

Reasons sensitive data may be stolen

Most departing employees don’t have malicious intent, they may take data accidentally or through a misunderstanding. However, some employees steal data for their own fulfillment. Common reasons for a departing employee to take corporate data include:

To secure a new job or compete with a former employer:

A company’s trade secrets or intellectual property can be valuable to a competitor. Departing employees can leverage this data to obtain a new job or gain an advantage in their new position by using it to compete with their former employer.

For personal financial gain:

A former employee may be able to sell the data they take to profit from confidential information. Alternatively, they may use the stolen information to jump-start their business venture by leveraging insights they acquired to gain a competitive advantage in the market.

To seek revenge:

Employees may be disgruntled or frustrated regarding the circumstances surrounding their departure, whether due to layoffs, conflicts, or other issues. Such frustrations can lead to malicious data destruction that can sabotage their previous employers’ operations.

On accident:

Data exfiltration (an intentional, unauthorized, or covert transfer of data from a computer or other device) is not always the work of malicious employees. Some might mistakenly believe the data belongs to them, or they may inadvertently retain it by failing to clear their devices. Additionally, former employees might unintentionally share sensitive information through unsecured channels.

Data theft warning signs

Companies can work to prevent data theft by proactively monitoring warning signs and implementing robust security measures.

Indicators that an employee may compromise sensitive information include actions such as:

• Engaging in suspicious web-based activities, such as utilizing incognito browsers, having several webmail accounts, researching how to bypass security, and using personal file-sharing platforms
• Using unauthorized personal devices for business activities
• Accessing business data at unconventional times or repeatedly
• Downloading or transferring an excessive amount of data
• Requesting to gain access to information that is outside the scope of their job description
• Recording or taking screenshots of company meetings
• Acting out of character or in a way that is against company policies
• Trying to trick or pressure coworkers into gaining access to their data

Employers can better protect their data and maintain system integrity by staying vigilant and addressing these behaviors promptly.

How to prevent data theft

Ensuring sensitive data is protected when an employee departs from an organization is crucial. A combination of monitoring, establishing access controls, and communicating clear policies can reduce the risk of theft.

Organizations can implement the following top six strategies to cut down on data theft:

1. Be proactive. Look for the previously mentioned warning signs to stop data theft before it happens.
2. Establish clear policies and procedures. Policies should state the difference between personal and business use of data, devices, networks, and other technologies. They should also contain how information is released to new, existing, and departing employees.
3. Assign ownership of insider threat risks. This designated person is responsible for updating the data theft prevention program, conducting employee training, and maintaining an incident response plan.
4. Adopt a cautious approach when employees leave. Assume a departing employee can retain access to some sensitive information after they leave. Utilize tools that create an audit trail should an issue arise.
5. Acknowledge that no system will be completely effective in stopping all data theft. No matter how advanced, technological data loss prevention systems cannot prevent all instances of data exfiltration. Continually update your policies and regularly test your procedures.
6. Encourage timely cross-collaboration between departments (e.g., HR and IT). Collaboration is crucial during offboarding to ensure equipment is returned promptly after a departing employee’s access to data is restricted. Not all cases are the same but having strong communication between departments is crucial.

Safeguarding sensitive data from departing employees requires various approaches that combine monitoring, clear policies, and strategic collaboration across teams. By proactively identifying warning signs and establishing a culture of security and vigilance, companies can mitigate the risk of data theft and protect their information.

Contact a trusted advisor today for comprehensive risk management solutions, including cyber insurance, tailored to your organization.