National Public Data 30B Person Data Breach: End Online Background Checks?

Should we continue using Online Background Checks, especially when states are already curbing their use? The answer might not be simple, but the breach has certainly raised red flags about the effectiveness and ethical implications of such systems.

In December 2023, National Public Data (NPD), one of the largest background check services in the world, fell victim to a massive cyberattack. By April 2024, an estimated 2.9 billion sensitive records, including Social Security numbers, names, addresses, and phone numbers, had been circulating on the dark web. This wasn’t just a minor breach—it impacted individuals in the United States, Canada, and the UK, highlighting the global reach of NPD’s services and, unfortunately, its vulnerabilities.

The fallout has been disastrous. As of October 2024, NPD has filed for bankruptcy, with countless lawsuits and state investigations on its heels. State prosecutors across the U.S. have demanded civil penalties, and class-action lawsuits have accused the company of negligence and unjust enrichment.

The company, owned by Jericho Pictures, has faced legal claims from more than 20 state attorneys general, demanding it account for its role in mishandling such a large volume of personal data.

https://millerlawpc.com/miller-law-investigates-jerico-pictures-inc-regarding-data-security-incident/

The NPD breach raises a significant question: Is it time to put an end to online background checks? This conversation isn't new. Many states have already enacted "ban the box" laws, which prevent employers from asking about criminal records in initial hiring stages.

These laws were designed to offer individuals with a criminal past a fairer shot at employment, without facing automatic rejection based on their history.

Yet, despite these efforts, the use of online background checks remains widespread, particularly among industries where vetting is crucial, such as healthcare, finance, and childcare.

However, given the sheer volume of personal data collected and stored by companies like NPD, and the growing number of data breaches, it's time to consider whether these checks do more harm than good.Time to End Online Background Checks?

The risks of continuing with online background checks are glaring. The NPD breach exposed how easily large amounts of sensitive information can be stolen and misused. Identity theft, phishing scams, and financial fraud have all surged as a result of the leaked data. Criminals can now use these details to impersonate tax authorities, relatives, or businesses, potentially wreaking havoc on millions of lives.

Moreover, the growing number of data breaches demonstrates that companies tasked with safeguarding personal information often lack the necessary cybersecurity measures.

Shields’ comments highlight the need for stronger regulations and the urgent rethinking of how personal data is handled.

Beyond the security risks, there are ethical questions surrounding the use of background checks. Are they inherently discriminatory? Critics argue that background checks disproportionately affect minorities, especially African American and Hispanic communities, who are more likely to have criminal records due to systemic inequalities in the justice system.

Additionally, the stigma attached to a criminal record can follow an individual for life, even after they have paid their debt to society. The widespread availability of online background checks exacerbates this issue, making it difficult for people to move on from their past mistakes and start afresh.

As "ban the box" laws gain traction, it’s clear that many states recognize the importance of balancing safety with second chances. But with data breaches becoming a regular occurrence, it’s becoming equally important to ask whether these checks are worth the potential harm they can cause to innocent individuals whose data has been leaked.

If the NPD breach weren’t enough to make companies reconsider their data security strategies, the recent $52 million settlement between Marriott and state attorneys general should serve as a wake-up call. Between 2014 and 2020, Marriott experienced multiple data breaches that impacted 344 million customers globally.

Under the settlement terms, Marriott agreed to enhance its cybersecurity practices, including offering U.S. customers the ability to delete personal data and implementing multi-factor authentication for accounts.

The Marriott breach underscores the trend of states taking a more aggressive stance on data privacy. Ast view data as currency and take the same precautions to safeguard it. If businesses can’t protect their users' data, the consequences—both financial and reputational—will continue to rise.

Read the FTC Agreement Here: https://www.ftc.gov/news-events/news/press-releases/2024/10/ftc-takes-action-against-marriott-starwood-over-multiple-data-breaches

So, what does the future hold? Is it time to put an end to online background checks altogether? While the decision may ultimately rest with policymakers, the National Public Data breach has made one thing clear: our current system is broken. The risks of data exposure and identity theft are too high to ignore, and as more states push for data privacy reforms, companies will need to rethink how they handle and store sensitive information.

Perhaps the solution lies not in completely abolishing online background checks but in reforming them. Employers can limit the amount of data they request, and companies offering these services can implement more stringent security measures. At the same time, individuals should be given more control over their personal data, with options to remove or limit access to sensitive information.

As we move forward, we must ask ourselves whether the benefits of online background checks truly outweigh the risks. In a world where data is as valuable as gold, it’s time to rethink how we balance safety, security, and privacy.

"Marriott's $52M Data Breach Settlement Points to Emerging Trend" by Lisa Willis: Marriot Settlement FTC

"After breach of billions of records, National Public Data files for bankruptcy" by Gintaras Radauskas

Miller Law Investigates Jerico Pictures Inc. Regarding Data Security Incident

Mark Derho is a seasoned expert in the Internet industry with over 25 years of experience in NYC's software development, digital marketing, and advertising sectors. A certified Google Partner, Mark specializes in content creation, AI chatbot development, open-source software, modern website design, and SEO/SEM marketing. He leads PR Website Agency and lives in Puerto Rico with his dog, Luno.