Singtel might lose more than one-quarter of its yearly earnings as a result of the costs it would incur to make up for one of the greatest data breaches that has occurred in Australia.
Last week, Optus, the Australian mobile phone firm that is owned and operated by Singtel, said that hackers had gained access to the personal information of up to 9.8 million subscribers, which is equivalent to more than one-third of the population. According to the government, over 2.8 million of them lost information of passports, driver’s licenses, or government-issued medical identification cards, which triggered fears about large-scale identity theft.
A week after the attack was made public, the scope of the incident and the impact, as well as the potential implications for Optus, are continuing to expand.
The Prime Minister of Australia, Anthony Albanese, has said that the Singtel ought to pay for replacement passports, and the leaders of Australia’s most populous states have stated that Optus would pay for new driving licences. As a direct result of the hack, the government intends to further strengthen the regulations governing cyber-security.
Over the course of more than a decade, cyber assaults have grown more prevalent around the globe, resulting in the exposure of at least 11.43 billion customer data at several hundred organizations. In relation to the hacking of Optus, the Australian authorities are cooperating with the Federal Bureau of Investigation in the United States.
On Wednesday, the Minister for Home Affairs and Cyber Security, Clare O’Neil, referred to the hack as “a tremendous wake-up call” for the business sector in Australia.
According to the chief executive officer and founder of the cyber-security firm StickmanCyber, Mr. Ajay Unni, the average cost spent by a business that has been hacked for each customer data lost is between US$150 and US$200 (S$216 and S$288)
This includes monetary compensation, the cost of legal representation, as well as the expense of public relations initiatives.
According to what he claimed, “some organizations wind up paying twice that.”
If this was simply applied to the 2.8 million Optus customers who were most adversely impacted, the total amount would be between US$420 million and US$560 million. During the fiscal year that concluded in March, Singtel recorded a profit of $1.44 billion U.S. dollars.
According to Mr. Unni, Optus is also expected to spend money on educating employees and increasing the level of security.
Slater & Gordon, an Australian legal company, is evaluating the possibility of bringing a class action lawsuit against Optus and reports that it has received tens of thousands of registrations for the case.
It is difficult to itemize the expenses associated with Optus. It has extended a complimentary 12-month membership to the credit monitoring and identity protection service Equifax to the consumers who were affected the most severely. Since one month of this service costs A$14.95 (S$14), the total potential cost of this promotion would be A$502 million if 2.8 million users took advantage of it. Although it is unclear how many passports have been hacked, passports are the most costly of the identification papers that have been compromised. There is a replacement fee of $193.
Optus did not respond to an e-mail that asked for comment on the potential expenses or the estimate that ranged between $420 million and $560 million. The corporation has issued an apology for the data breach that occurred. At the end of Wednesday’s business day, it was reported that 36,900 medical identification numbers were among the documents that were compromised.
Ms. O’Neil said that the Australian government need to have greater powers to enforce cyber-security rules on private enterprises, and that this is something that she would be looking into doing in the aftermath of the incident.