Compliance Check Out Time for Wyndham Hotels

Of all the challenges a company will face after a data breach, the worst could be the loss of trust in their brand.

That’s what Wyndham Worldwide Corp. and three subsidiaries are facing now, after U.S. regulators filed a complaint alleging that a failure to safeguard consumers’ personal information had led to more than $10 million lost to fraud.

Other major corporations have also fell victim to hackers, including Sony and Microsoft. But the Wyndham case is especially troubling because the company is a repeat offender. There was a breach in April of 2008, and two more in 2009. These attacks resulted in fraudulent charges on consumer accounts, according to the Federal Trade Commission complaint against the company.

How did they happen? The complaint alleges that Wyndham failed to take basic security measures, such as requiring strong passwords, and storing credit card information in clear, readable text. As a result, that payment card information wound up at an Internet domain address in Russia.

“Even after faulty security led to one breach… Wyndham still failed to remedy known security vulnerabilities; failed to employ reasonable measures to detect unauthorized access; and failed to follow proper incident response procedures,” the FTC said.

As a result, Wyndham has had to contact customers to let them know what is happening. Guests that might have been affected have been offered the free use of a credit monitoring service for one year. But how many of those customers will now think twice before booking a room for their next vacation? How many business travelers will choose to stay elsewhere?

Data security is essential. Is it easy? No. Not if you try to do it yourself. But if you employ the services of a company experienced in data protection, the appropriate safeguards can be implemented with little – if any – interruption in business operations. And with ongoing preventive maintenance, these safeguards will be sustained, adjusted when necessary to deal with new challenges, and upgraded as soon the technology is available.

 

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