Marriot International Face Intended Fine Over £99m Under GDPR
The Information Commissioner’s Office (ICO) intends to fine Marriott International £99,200,396 for infringements of the General Data Protection Regulation (GDPR).
The intended fine relates to a cyber incident which was notified to the ICO by Marriott in November 2018 which involved the exposure of customer information of the Starwood Hotel Group systems.
The incident saw a variety of personal data, which contained approximately 339 million global guest records exposed. Around 30 million of these records related to residents of 31 countries in the European Economic Area. Seven million related to UK residents.
Starwood Hotels Group was acquired by Marriott in 2016, however the vulnerability is said to have started in 2014 when Starwood’s systems were compromised. The exposure of customer information wasn’t discovered until 2018.
Elizabeth Denham, Information Commissioner, said:
“The GDPR makes it clear that organisations must be accountable for the personal data they hold. This can include carrying out proper due diligence when making a corporate acquisition, and putting in place proper accountability measures to assess not only what personal data has been acquired, but also how it is protected.
“Personal data has a real value of organisations have a legal duty to ensure its security, just like the would do with any other asset. If that doesn’t happen, we will not hesitate to take strong action when necessary to protect the rights of the public.”
Kingsley Hayes, managing director at data breach and cyber security specialist Hayes Connor Solicitors also commented on the news of the ICO’s intention to fine Marriott International. He said:
“The ICO has started to show its teeth with two international organisations facing significant fines this week. Marriott International suffered a cyber attack in 2014 affecting millions of its guests yet the incident was not discovered until four years later.
“This raises serious questions about the robustness of its cybersecurity and the frequency that Marriott reviews its data protection measures which is evidently lacking. Interestingly, both British Airways and Marriott International have stated that they will contest the fines indicating that businesses are still underestimating the serious implications, both in the short and long term, on affected customers.
“The penalties for businesses who fail in their data protection obligations do not end with the ICO fines. Hayes Connor is representing in excess of 500 clients against British Airways and against Marriott International. Our clients are entitled to compensation for actual, and potential, financial loss and for some, the psychological distress directly caused by the breach.
“Hayes Connor is also engaged in High Court Litigation against Ticketmaster following its notification of a large scale data breach last year. This is the first of the high profile, high volume, and value, cases to be in the High Court post-GDPR.
“Whilst the ICO pronouncement on that investigation is imminent at a hearing in Liverpool High Court today, HHJ Pearce provided an order of the Court for the case to move forward this year to start to establish the liability of Ticketmaster to its customer base.
“While large organisations like Ticketmaster, British Airways and Marriott can take the financial hit, these hefty penalties can threaten the survival of many small and medium-sized organisations.
“Evidence to date, however, shows that the majority of businesses are still not taking data protection seriously enough and more needs to be done to protect consumers’ privacy.”
Marriott has co-operated with the ICO investigation and has made improvements to its security arrangements since these events came to light. The company will now have an opportunity to make representations to the ICO as to the proposed findings and sanction.
The ICO has been investigating this case as lead supervisory authority on behalf of other EU Member State data protection authorities. It has also liaised with other regulators. Under the GDPR ‘one stop shop’ provisions the data protection authorities in the EU whose residents have been affected will also have the chance to comment on the ICO’s findings.