What is Data Leakage, and How to Prevent It 

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Data Leakage

Key Takeaways

  • Data leakage refers to the unauthorized transfer of data outside a secure environment, whether accidentally or maliciously.
  • Accidental leaks, often due to human error, are a significant cause of data exposure and can be mitigated with better security practices.
  • System misconfigurations and outdated software are significant vulnerabilities that lead to data leaks, emphasizing the need for regular updates and audits.
  • Insider threats, both malicious and accidental, are critical risks that require careful monitoring and strict access controls.
  • External cyber attacks exploit system weaknesses to steal sensitive data, necessitating robust intrusion detection systems and secure protocols.
  • Data Loss Prevention (DLP) software is essential for monitoring, detecting, and preventing sensitive data from leaving an organization.
  • Encrypting data, both in transit and at rest, ensures it remains secure even if intercepted.
  • Regular security and compliance audits help identify vulnerabilities and ensure adherence to data protection regulations.
  • Employee training on data security best practices is crucial for preventing accidental data leaks and enhancing overall security.
  • A proactive approach to data security, including a well-implemented DLP strategy, protects against financial, legal, and reputational damage from data leaks.

Data leakage is a critical issue in today’s digital world. It occurs when sensitive information gets exposed without authorization. This can happen through various means, such as human error, system flaws, or cyberattacks. Data leaks can lead to severe consequences, including financial losses, reputation damage, and legal penalties.

Preventing data leakage is crucial for protecting your business and your customers. This article will explain data leakage and how it can impact your organization. We will also provide practical steps to prevent data leakage and safeguard your sensitive information.

Understanding and addressing this issue can enhance your data security and protect your business. Keep reading to learn more about data leakage and the best prevention practices.

Let’s begin.

Table of Contents

  1. Key Takeaways
  2. What is Data Leakage?
    1. Data Leaks vs Data Breach
  3. Common Causes of Data Leakage
    1. Accidental Leaks Due to Human Error
    2. System Misconfigurations
    3. Insecure Applications and Systems
    4. Malicious Insider Threats
    5. External Attacks and Breaches
  4. Impact of Data Leaks on the Affected Businesses
    1. Financial Losses
    2. Reputation Damage
    3. Regulatory Penalties
    4. Operational Disruption
    5. Share Price Drops
  5. Types of Sensitive Data
    1. Personally Identifiable Information (PII)
    2. Confidential Data
    3. Financial Data
    4. Company Secrets
  6. Types of Data Leaks
    1. Unintentional Data Exposure
    2. Software Vulnerabilities
    3. Malicious Insider Threats
  7. Data Leakage Prevention
    1. Best Practices for Data Security
    2. Technological Solutions
  8. Creating a Data Leakage Prevention Strategy
    1. Identifying Sensitive Data
    2. Mapping Data Flow Within the Organization
    3. Implementing Layered Security Measures
    4. Training and Awareness for Employees
    5. Regular Updates and Patches for Security Systems
  9. Conclusion
  10. FAQs

What is Data Leakage?

What is Data Leakage?

Credits: Freepik

Data leakage, the unauthorized transfer of information outside a secure network, can have serious consequences. When information from outside the training dataset is used to create a model, it can lead to overly optimistic performance estimates and a poorly performing model on real-world data. This is a ‘cheat’ by learning from data it’s not supposed to have access to, and it’s a serious threat to data security.

Data leaks can happen in any organization. Common causes of data leaks include human error, system failures, and cyber attacks. Data may accidentally be exposed or stolen, known as a data disclosure. A data leak and a data breach involve unauthorized access to data, but a leak is often accidental, while a breach is usually intentional. To detect data leakage, companies must monitor their data sets closely.

Also read Dedicated Server Security: How To Keep Your Server Safe in 2024?

Data Leaks vs Data Breach

Data Leaks vs Data Breach

Data leaks are considered the illegal usage of data from one organization for another, and significant data leaks happen due to accidents. Let’s say you are sending an email that contains a password. It can be mistakenly delivered to the wrong recipient, so the person who is not supposed to have access to that password can get it.

In contrast, a data breach is unauthorized data transmission within an organization to an external destination or recipient.


Data leakage is usually inadvertent. It happens when sensitive information is accidentally exposed due to security lapses or human error. Data breaches involve intentional actions by malicious actors, such as hackers. They deliberately infiltrate systems to access and exploit sensitive data for malicious purposes.

Common Causes

Phishing, weak passwords, malware, and third-party vulnerabilities often cause data breaches. Insider threats, ransomware, unpatched systems, and credential stuffing also cause them. Finally, supply chain vulnerabilities are a common cause. Data leaks often come from human error or theft. They also come from weak access controls, misconfigured systems, and social engineering. They can also come from intentional leaks, weak security policies, unencrypted data, and poor education. Organizations must understand the differences between data breaches and data leaks. This is crucial for them to take proactive measures to reduce security risks and protect their sensitive data.


Breaches are usually found by monitoring for unauthorized access to sensitive data. This includes unusual network activity or signs of a cyberattack. Detection methods for data breaches often involve intrusion detection systems and log analysis. They also use anomaly detection and threat intelligence. These methods aim to find and respond to unauthorized access and data theft by cybercriminals. It focuses on finding when sensitive data is accidentally exposed or shared incorrectly. This often happens by monitoring data flows. It involves access controls and data loss prevention (DLP) solutions.

Impact of Data Breach vs Data Leakage

Cybercriminals use security flaws to steal confidential data. This data includes personally identifiable information (PII), financial records, and trade secrets. They do this for bad purposes, like selling data on the dark web, espionage, or sabotage. Data breaches’ aftermath often includes big costs. These include fines, loss of trust, and the need for effort to restore security and prevent future incidents.

While data leaks may not involve malicious intent, they still seriously threaten data security and privacy. Data leakage has many impacts. These include legal consequences. They also include violations of compliance and loss of intellectual property. And the loss of customer confidence. Finding and fixing data leaks quickly is crucial. It minimizes the damage from accidental data exposure.


Data breaches include Malware infections, ransomware attacks, and exploiting system vulnerabilities that let attackers access sensitive data. The Equifax breach in 2017 and the yahoo breach in 2013 are also an example of a data breach.

People make errors. They include sending emails to the wrong person or misplacing storage devices. Poor access controls allow unauthorized access to sensitive data.

Prevention Measures

Advanced intrusion detection systems, regular security audits, and firewalls can prevent data breaches. On the other hand, encryption, access controls, employee training, and data loss prevention (DLP) software can prevent data leaks.


Data breaches and data leaks have severe outcomes. They often cause financial losses, reputational harm, and legal trouble for organizations. Cyberattacks cause data breaches. They can lead to the theft of sensitive information. This includes customer data, financial records, and intellectual property. Data leaks come from accidental exposure or insider threats. They can also lead to the unauthorized disclosure of confidential information. This may cause identity theft, compliance violations, and loss of customer trust. Both data breaches and leaks can be very costly. The average cost is millions of dollars per incident. And that’s not counting the time and effort for fixing and recovery.

Common Causes of Data Leakage

Common Causes of Data Leakage

Here are some common causes of data leakage.

Accidental Leaks Due to Human Error

One of the biggest causes of data leaks is human mistakes. Employees can accidentally expose sensitive data in many ways. They may send an email with confidential details to the wrong person. Or they could misplace devices like laptops or USB drives containing private information.

Human error also leads to poor security practices that enable leaks. Workers may use weak passwords that are easy to guess. They need to properly redact sensitive data before sharing files. Sometimes, employees purposely bypass security controls to get work done faster.

System Misconfigurations

Improperly configured systems and software are another frequent source of data leakage. Cloud storage services, databases, and other business apps may have default settings that leave data exposed. Misconfigurations could make files publicly accessible without realizing it.

Legacy software and systems that need to be correctly updated also create risks. They may need to be updated or updated with security patches, leaving gaps that enable data exfiltration by hackers or malware.

Insecure Applications and Systems

Flaws in designing and coding applications and IT systems also contribute to leaks. Software bugs or vulnerabilities could allow unauthorized access to data, and insecure data transmission, storage, and processing practices also raise risks.

Many off-the-shelf software products lack robust data protection capabilities by default. Customizing security settings is often required, which creates room for error. Legacy business systems tend to have weaker security than modern apps, too.

Malicious Insider Threats

Sometimes, data leakage occurs due to malicious insiders—employees or contractors who intentionally steal and misuse data. Insiders may exfiltrate data for personal gain or to benefit other parties, such as competitors or foreign entities.

Disgruntled current or former workers could leak data for revenge against an employer. Insiders recruited by external criminal groups or nation-state actors may sell corporate secrets or other sensitive data for profit.

External Attacks and Breaches

Outside hackers and cybercriminals are also a significant cause of data leakage through network cyber attacks and breaches. Techniques like phishing, malware, SQL injection, and exploitation of software vulnerabilities allow unauthorized access.

Once inside a corporate network, hackers can steal vast volumes of sensitive data. They may siphon intellectual property, customer records, payment data, etc. Breaches often go undetected for months, enabling widespread data exfiltration.

Another risk is leakage from third-party partners, contractors, and suppliers. External vendors may accidentally or intentionally expose the sensitive data of their companies.

Also, read Best Practices for Secure Dedicated Server Management

Impact of Data Leaks on the Affected Businesses

Impact of Data Leaks on the Affected Businesses

Data breaches often have severe consequences for impacted businesses:

Financial Losses

Data leaks can lead to severe financial losses for businesses. Costs include fines, legal fees, and compensation to affected parties. Companies may also spend on improving security measures after a leak. Moreover, losing customer trust can result in decreased sales and revenue. These financial hits can harm the business’s stability and growth.

Reputation Damage

Data leaks can seriously harm a business’s reputation. Customers lose trust when their information is exposed. This distrust can lead to a loss of clients and potential customers. Negative publicity from a data leak spreads quickly, damaging the company’s public image. Rebuilding trust and reputation takes time and can be very costly.

Regulatory Penalties

Data leaks can result in hefty regulatory penalties for businesses. Governments enforce strict data protection laws. When a leak occurs, companies may face fines for non-compliance. These penalties can be substantial, depending on the severity of the leak and breach and the laws violated. Additionally, businesses might undergo audits and increased scrutiny, increasing costs and operational challenges.

Operational Disruption

Data leaks can cause major operational disruptions for businesses. When a leak occurs, companies must shift their focus to address the leak. This includes investigating the incident, fixing vulnerabilities, and managing customer concerns. Normal business activities may be delayed or halted. These disruptions can lead to a loss of productivity and increased costs, affecting overall business performance.

Share Price Drops

Data leaks can lead to significant drops in a company’s share price. When a leak occurs, investors often lose confidence in the business. This lack of confidence can result in the rapid selling of shares, causing the stock price to fall. The financial market’s reaction to a data leak can negatively affect the company’s value and investor relations.

Types of Sensitive Data

Types of Sensitive Data

Let’s discuss types of Sensitive Data.

Personally Identifiable Information (PII)

PII is any data that could identify a specific individual. Examples include full name, date of birth, and biometric records like fingerprints. Contact details like home address, phone numbers, and email are also PII.

Other forms of PII include financial information linked to a person, such as credit card or bank account numbers. It also includes details on someone’s race, ethnicity, religion, or sexual orientation. Even seemingly innocuous PII, like a person’s zip code or birth date, can be misused.

Businesses must safeguard customer and employee PII to prevent identity theft and fraud.

Confidential Data

Confidential data refers to any private information organizations want to restrict access to. It covers sensitive business materials. For instance, contracts, internal memos, and client communications.

Companies work hard to keep confidential data confidential. If leaked, it can benefit competitors or hostile entities. Data breaches involving confidential info often incur immense financial, legal, and reputational damage.

Financial Data

Financial data encompasses money-related private data, such as payment card information, bank account numbers, investment portfolios, and loan records. Tax records containing sensitive income details are also financial data.

Financial institutions like banks handle massive volumes of financial data daily. But even non-finance businesses collect the data. They store customer payment info, payroll data, accounting records, and more.

Company Secrets

Company or trade secrets are closely guarded business information that provides a competitive advantage. They include proprietary data, formulas, processes, strategies, research findings, software code, and future product plans.

Tight access restrictions, non-disclosure agreements, digital rights management tools, and aggressive pursuit of leakers help protect company secrets. However, accidental data spillage through misconfigured systems also enables significant leaks.

Types of Data Leaks

Types of Data Leaks

Here are the most common types of data leaks.

Unintentional Data Exposure

Here are the ways of unintentional data leakage.

  • Employee Brings Files Home from Work: Employees may take work home. He may store data on their devices, which could lead to a data leak if the device is lost or insecurely stored.
  • Unencrypted Data Storage: Unencrypted data stored in cloud storage, instant messages, or emails is vulnerable to unauthorized access.
  • Password Misuse: Employees writing down or insecurely storing passwords. It could accidentally disclose them to a third party.

Software Vulnerabilities

Let’s explore software vulnerabilities.

  • Outdated Software: Attackers can exploit outdated software with known vulnerabilities to access sensitive data.
  • Software Misconfigurations: Improperly configured software could unintentionally disclose data without the administrator’s knowledge.
  • Development Server Compromise: Development environments often have loose security. The developers may replicate production data to the development server, potentially exposing that data.

Malicious Insider Threats

Let’s explore insider threats.

  • Social Engineering Attacks: Malicious actors may trick privileged users into providing sensitive information. For example, login credentials.
  • Malicious Insiders: Employees or other insiders may intentionally steal or leak data for profit or espionage.
  • Legacy Tools and Techniques: Older attack methods exploit legacy systems and physical devices despite new threats. For instance, USBs and printers still pose risks.
  • Physical Theft: Devices containing sensitive data, like laptops or USB drives, could be stolen, and the data could be accessed.

Data Leakage Prevention

Data Leakage Prevention

Here are the prevention methods for data leakage.

Best Practices for Data Security

Cyber threats are constantly evolving, making robust data security measures essential. Let’s explore the best practices for data leakage prevention.

Data Encryption

Encrypting sensitive data makes it unreadable to unauthorized parties. Encryption scrambles data into ciphertext using mathematical algorithms. Only authorized users with the correct encryption key can decode it.

Encryption protects data at rest and in transit. Companies should encrypt data stored in databases, cloud services, mobile devices, removable media, and data moving across networks and the Internet.

Standard encryption protocols include Advanced Encryption Standards (AES), Rivest, Shamir, and Adleman (RSA), and Transport Layer Security (TLS) or Secure Sockets Layer (SSL). Multi-factor authentication and secure key management are critical for practical encryption implementations.

Secure Access Controls

Access controls restrict data visibility and editing to approved individuals only. Role-based access enforces minimum permissions required for each employee’s job duties. Activities like copying data or printing files may also require separate approvals.

Strong password policies, biometric authentication, and privileged access management tools help control data access. Strict controls on sharing data outside the company are essential, too.

Regular Security and Compliance Checks

Security audits systematically evaluate an organization’s data protection posture against defined benchmarks or regulations. Audits identify gaps, vulnerabilities, and areas of non-compliance so they can be remediated.

Common security audits include penetration testing, vulnerability assessments, and compliance audits against frameworks. For example, PCI-DSS, HIPAA, and ISO 27001. Regular auditing keeps data security measures up-to-date.

Also read: Unveiling the Hidden Risks of Dedicated Servers

Technological Solutions

Let’s understand technological solutions and explore how they have emerged as powerful tools to address Data Leakages.

Data Loss Prevention (DLP) Software

DLP solutions help organizations prevent sensitive data from leaving authorized locations and channels. Core DLP capabilities include content inspection, contextual analysis, data classification, and policy enforcement actions.

DLP monitors data flows within networks, at endpoints, in the cloud, and via other channels. It automatically masks, blocks, or quarantines data movement that violates policies. Analytics provide visibility into data risks. Major DLP vendors include Symantec, Digital Guardian, McAfee, Forcepoint, Proofpoint, and Microsoft.

Intrusion Detection Systems (IDS)

IDS tools monitor networks and systems for malicious activities and policy violations that could lead to data exfiltration. They detect anomalies and analyze traffic patterns, user behavior, and system events.

IDS alerts security teams in real time about potential cyber threats like hacking attempts, malware infections, and insider threats. It complements firewalls and anti-virus by identifying advanced persistent threats.

Well-known IDS offerings come from vendors like Cisco, IBM, AT&T, McAfee, and CheckPoint.

Secure File Transfer Protocols

Secure file transfer protocols encrypt data in transit across networks or the internet. They ensure privacy and integrity when sharing large documents, reports, backups, or other sensitive file types.

Standard secure file transfer protocols include SFTP, FTPS, HTTPS, and AS2/AS3. These prevent data interception during uploads, downloads, or person-to-person transfers.

Managed file transfer (MFT) platforms simplify secure exchange between people, applications, and organizations.

Overall, tools and processes for encryption, access control, security assessments, data monitoring, threat detection, and safe file sharing are invaluable for blocking data leakage paths.

Also, read The Ultimate Guide to Dedicated Server Security.

Creating a Data Leakage Prevention Strategy

Creating a Data Leakage Prevention Strategy

In the digital age, protecting sensitive data is crucial. Businesses need to keep the trust of customers. They must obey regulations and protect valuable information. You must develop a robust Data Leakage Prevention (DLP) strategy. It is critical to reducing the risks of data breaches and leaks. Here is a detailed guide on how to create an effective DLP strategy.

Identifying Sensitive Data

The first step in making a DLP strategy is to identify sensitive data in the organization. This data requires protection. This includes personal data (PII) and financial records. It also includes intellectual property, trade secrets, and other data. If this data is exposed, it could harm the organization or its stakeholders. Taking a total count of sensitive data helps. It shows the amount of protection needed.

Mapping Data Flow Within the Organization

Understanding how data moves within the organization is crucial for adequate data protection. Mapping data flow involves finding where sensitive data is stored. It’s also about who can access it, how it is transmitted, and any data flow vulnerabilities. This mapping exercise helps find areas where data could leak. It allows for adding targeted security measures.

Implementing Layered Security Measures

A successful DLP strategy has a crucial aspect. It is the use of layered security. This involves using a mix of security tools and technologies. These include encryption and access controls. They also have data loss prevention software. They have intrusion detection systems and security monitoring solutions. By adding many layers of defense, organizations can make it harder for attackers. This will reduce the chance of unauthorized access to sensitive data.

Training and Awareness for Employees

Employees are critical to data security. Their actions can significantly impact DLP effectiveness. It is essential to provide thorough training and awareness programs for employees. They should cover data security best practices.

Training should cover handling sensitive data and recognizing social engineering attacks like phishing. It should also cover security protocols and stress the importance of data protection. Empowering employees with knowledge and skills helps them find and respond to security threats, making organizations more secure.

Regular Updates and Patches for Security Systems

Maintaining the security of systems and software is vital for preventing data breaches. Regularly update and patch security systems, applications, and devices. This helps address known weaknesses that cyber attackers could exploit. Staying current with security updates also helps. It reduces the risk of data leaks from software that lacks updates or outdated security.

By following these steps and using a strong DLP strategy. Organizations can improve their data security. They can also cut the risk of data breaches and leaks. And they will protect their sensitive information. Prioritizing data protection is essential today. It keeps the trust of customers. It meets regulations and reduces data breach impacts.

Also Read: What Is Cloud Data Security? Definition, Types & Benefits


Data leakage poses grave risks that organizations cannot afford to ignore. Exposing sensitive data can devastate a company. It can harm their finances, operations, reputation, and customer trust. Data leaks enable identity theft, financial fraud, and privacy violations for individuals. Data can leak in many ways. It can happen through human error, system flaws, malicious insiders, or outside cyberattacks. No company is safe from accidental or intentional data spillage threats. So, it is crucial to address security holes proactively.

Data is the lifeblood of the digital economy. Failure to protect it from leakage can be catastrophic. Take action now to assess your data risks and fortify your defenses. Invest in preventive solutions and processes tailored to your organization’s needs. Make data leakage prevention an ongoing priority.

Stay vigilant, keep learning, and continually enhance your security posture. The stakes are too high to let your valuable data leave the house.

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Q. Can data leakage happen through physical means?

Yes, data leakage can occur through physical means, such as losing a USB drive, improperly disposing of documents, or exposing sensitive information on unsecured hardware.

Q. What are some common signs of potential data leakage within an organization?

Common signs include unusual network activity, unexpected access to sensitive data, modified or accessed files at odd hours, or alerts from security monitoring tools.

Q. What is a Data Loss Prevention (DLP) system, and how does it help prevent data leakage?

A DLP system is a set of tools and processes. It ensures unauthorized users do not lose, misuse, or access sensitive data. DLP systems monitor, detect, and block sensitive data while in use, in motion, and at rest.

Q. How can small businesses without large IT departments effectively prevent data leakage?

Small businesses can implement basic DLP measures using off-the-shelf software solutions and regularly train employees on best practices for data security.

Q. How do data leaks occur, and what are the common causes?

Data leaks occur when sensitive data is unintentionally exposed or disclosed. They can be caused by human error, inadequate security policies, or system vulnerabilities. Common causes include misconfigured data storage systems like S3 buckets, phishing attacks, and exposure of sensitive information.

Q. What are the different data leak types, and how can they impact an organization?

Different types of data leakage include accidental leaks from human error, exposure of sensitive data through misconfigured applications or services, and intentional leaks by malicious insiders. Each type can damage an organization’s reputation, causing financial loss and legal implications.

Q. How can organizations detect data leaks and breaches effectively?

Organizations can detect data leaks and breaches by implementing data discovery tools that scan their systems for unauthorized access or exposure to sensitive data. Additionally, attack surface monitoring and real-time data analysis help identify suspicious activities that may indicate data breaches.

Q. What role do security policies play in preventing data leaks?

Security policies are essential in setting the standards for handling sensitive data and confidential information, defining security protocols, and enforcing measures that secure data across all departments. Effective data governance and compliance with these policies significantly reduce the risk of data leaks.

Q. What prevention solutions are available to safeguard against data leaks involving susceptible data?

Prevention solutions to safeguard susceptible data include using encryption, implementing strict access controls, deploying data loss prevention (DLP) software, and continuously monitoring data flows. These solutions help minimize the risk of sensitive data exposure and ensure data integrity.

Q. In the context of future data security, why is implementing robust data protection strategies a significant factor?

Implementing robust data protection strategies is a significant factor in future data security as it prepares organizations to handle evolving cyber threats and protect against data leaks. It involves adopting advanced security technologies, continuously updating security practices, and educating employees about the importance of data security.

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