Misuse of Personal Data: Case Examples and Consequences

The misuse of personal data has become a serious issue as digital technology advances. Many cases of personal data misuse have caused significant harm to individuals and organizations. In one data breach case in Indonesia, a company suffered losses amounting to billions and took a long time to regain public trust.

Personal data misuse refers to the use of someone's personal information without permission or in an unlawful manner. This can include collecting, using, or disclosing personal data without the data owner's valid consent.

Here are some examples of personal data misuse cases and the resulting losses.

Examples of Personal Data Misuse

According to the "Public Perception of Personal Data Protection 2021" survey by Kominfo (reported by Databoks) on over 11,000 respondents, 28.7% of the public admitted to having experienced such incidents. About 44.1% of respondents experienced a reduction in their bank account balances and 32.2% lost e-wallet balances due to data breaches. Respondents consider e-wallets and bank accounts as the most vulnerable products to data breaches. The survey also shows that the public disagrees with the practice of sharing or selling personal data between institutions.

So, what are some cases of personal data misuse that have occurred in Indonesia?

Data Breaches from Online Services

The most common personal data theft starts with data breaches. The average victims of data breaches are users of financial applications such as banks, paylater services, e-commerce, or multi-payment platforms.

There have been numerous reports about data breaches carried out by hackers. An individual found that their personal information, such as name, NIK (identity number), phone number, address, and other contact details, had been leaked from an application they used. This data is usually uploaded by hackers to a site to be sold to interested parties. The data is then used for various fraudulent activities.

Identity Theft Through Phishing

This case of personal data misuse is not directly carried out by hackers. Unlike data breaches, phishing is done by the personal data owner themselves. How does this happen?

A user receives an email, SMS, or WhatsApp message that appears to be from a trusted institution, such as the financial institution where the victim keeps their money. The message content is usually very convincing, such as announcing a lottery prize winner. Believing the message, the victim then provides their account information and other personal data. Unknowingly, the victim has leaked their confidential information to scammers who then use it to access their bank account.

The message also usually contains a link. The victim is asked to click on the link for more information. When clicked, it turns out that the link is a way for hackers to extract personal information from the victim's phone.

Data Theft from Technology Companies

Data theft from technology companies refers to a series of incidents where sensitive or confidential information from tech companies is hacked, stolen, or accessed illegally by unauthorized parties. This can involve attacks on company data, illegal access to computer systems, or theft of hardware such as laptops or servers containing important data.

Some of the company data vulnerable to theft include product designs, application source codes, customer information, financial data, and trade secrets that can provide significant competitive advantages.

The impact of data theft from technology companies can be extensive, including financial losses due to lost customer trust, data and system recovery costs, and potential legal fines from regulatory authorities if customer data is affected.

Consequences of Personal Data Misuse

Personal data misuse can cause various damages affecting individuals and organizations. Here are some of the main possible consequences.

1. Financial Losses

One of the most felt impacts of personal data misuse on individuals is financial losses. This can occur because scammers are likely to use personal data to access bank accounts, apply for loans, or make unauthorized purchases.

2. Reputation Damage

Individuals can also experience reputational damage due to personal data misuse. Scammers who obtain someone's personal data can do anything with it, such as applying for loans and spreading false information.

3. Emotional and Psychological Distress

Personal data misuse can also cause emotional and psychological stress to affected individuals. The sense of insecurity, worry, and fear of violated privacy can disturb someone's mental state.

4. Legal and Regulatory Consequences

Companies that fail to protect personal data may face legal actions and hefty fines from regulatory authorities. Legal costs and case settlements can also be very expensive and impact the financial stability of the company.

5. Financial Losses

Similar to individuals, companies also suffer financial losses. In e-commerce, banking, or fintech companies, leaked personal data is often used for transactions. This is why personal data theft often costs companies billions.

6. Reputational Damage

Data breaches indicate that the company has failed to protect users' rights adequately. This negatively impacts the company's reputation. Reputation damage can significantly affect the company's business performance.

7. Stock Price Decline

The company's reputation also affects its stock price. Stocks, as indicators of a company's health, are very responsive to internal events. Investor satisfaction is disrupted if the company incurs losses due to poor data security systems.

8. Policy Changes

As a result, companies must change their policies, including investments, strategies, and human resources. This causes instability within the company for a certain period, disrupting business activities.

9. Increased Operational Costs

Policy changes also involve additional costs. Costs to address identity fraud include investigation costs, consumer compensation, system repairs, and reputation mitigation costs. The company's budget needs to be re-evaluated, requiring significant time and resources.

10. Impact on National Security

Large-scale personal data misuse can threaten national security. Sensitive information that falls into the wrong hands can be used for espionage, sabotage, or cyber-attacks on critical infrastructure.

To avoid personal data misuse, use services that employ advanced technology in the digital identity verification process. As a tech company, VIDA offers verification solutions to protect personal data. Currently, VIDA focuses on developing and enhancing verification and digital signature solutions. Combining these two solutions can be integrated into various platforms according to company needs. Contact the VIDA team for more information about their services.