Cyber Insurance Blog

A Guide to Privacy Act Violations (With Examples)

A Guide to Privacy Act Violations (With Examples)

Our personal data is being used in thousands of ways. From streamlining our checkout process to monitoring our heart rate—or even suggesting a movie we may like on a streaming platform—our information has become a key component in the way we experience technology.

 Hacker on laptop plugs in numbers from credit cards sitting next to him.

While businesses and organizations use consumer data for many reasons, all of these companies share one substantial risk: privacy act violations. With technology and the use of data rapidly changing, the organization’s responsibility to collect and store the information is also changing. Even some of the largest, most reputable companies have slipped up and added to the growing list of privacy act violation examples.

Cyber risk is often an underrated threat for many business owners. Some may think they’re not a target, while others don’t realize how substantial the costs associated with a breach can be. Adding to this risk, a cyber breach does not have to have occurred to be considered a violation of privacy. Read on to learn about what digital privacy is, why it is important, and how some privacy act violation examples have shown up in the real world.

What is a Violation of Privacy?

While they both involve consumers’ personally identifiable information (PII), a cyber breach and a violation of privacy are different. When a cyber attack or data breach occurs, a hacker or cyber criminal gains unauthorized access to an internet database or network and steals private information.

Person sitting across the table from a lawyer.

A violation of privacy does not involve a cyber criminal. Instead, a business or organization is knowingly utilizing a consumer’s information in a misleading or unknown manner to the consumer.

Can Breach of Privacy be a Violation of Privacy Law?

In May 2018, the European Union passed the General Data Protection Regulation (GDPR), the most rigid privacy and security law in the world.

Following the GDPR, the California Consumer Privacy Act (CCPA) was passed in June 2018, giving California consumers the right to see what individually identifiable information a company has saved (including information shared with third parties). This allows consumers to sue companies when privacy laws are violated—even when no breach has occurred. The invasion of federal privacy law can lead to significant consequences for an organization.

Privacy Act Violation Examples:

There are numerous privacy act violation examples where the associated fines can significantly impact the bottom line of a business. Organizations have to ensure that they’re protecting their customers’ data, and that they’re also complying with all rules and regulations while handling and storing this sensitive information.

 Phone with facebook open in front of a gavel.

Organizations that communicate false pretenses on their data use or commit a violation of privacy law may face serious consequences from the federal government. Below are three recent instance of privacy law violations:

1. Zoom Secretly Displayed Data from LinkedIn Profiles

It was discovered that a data-mining feature on Zoom was allowing Zoom users to view LinkedIn profiles of other users without their knowledge (even when users had elected to be listed as “anonymous”).

2. FTC Imposes $5 Billon Penalty on Facebook

As one of the largest penalties for violation of privacy law ever, the Federal Trade Commission held Facebook accountable for deceiving users about their ability to control the privacy of their personal information. Facebook shared users’ private data with third-party apps that had been downloaded by the users’ Facebook “friends” without the users’ knowledge.

3. Youtube Faces Lawsuit Over Children’s Privacy Violations

In both the US and the UK, class action lawsuits have been filed against the video streaming giant with the accusation that protected data from minors has been collected and sold. While Youtube claims to exclude children younger than 13, third-party research has shown otherwise, and the platform continues to host a vast and growing category of content aimed at young children.

 

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Many privacy act violation examples are costly and undoubtedly damage an organization’s reputation and relationship with consumers. It’s imperative that businesses disclose the handling and use of consumer data and remain transparent, in addition to following all rules and regulations.

ProWriters Leads The Way

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Cyber liability and privacy law violations are complex. Your clients need experts they can trust to ensure they’re taking every precaution to protect their customers and clients.

With ProWriters, we offer FREE downloadable resources for brokers so they can best serve their clients.

To help your clients better understand their exposure, download our Cyber Risk Management 101 infographic where we break down the importance of recognizing cyber risk and the steps clients can take to get protected.

For more information on how you can protect your clients, contact us or speak with a ProWriters expert at (484) 321-2335.

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