ICO to fine Marriott over $124 million for compromising 383 million users’ data last year

The UK’s watchdog, Information Commissioner's Office (ICO) announced that it plans to impose a fine of more than £99 million ($124 million) under GDPR, on the popular hotel chain, Marriott International over a massive data breach which occurred last year.

On November 19, 2018, Marriott revealed that the data breach occurred in Marriott’s Starwood guest database and that this breach was happening over the past four years and collected information about customers who made reservations in its Starwood subsidiary. The company initially said hackers stole the details of roughly 500 million hotel guests. However, with a further thorough investigation the number was later corrected to 383 million.

This is ICO’s second announcement of imposing significant fines on companies involved in major data breaches. A few days ago, ICO declared its intentions of issuing British Airways a fine of £183.39M for compromising personal identification information of over 500,000 customers.

According to ICO’s official website, “A variety of personal data contained in approximately 339 million guest records globally were exposed by the incident, of which around 30 million related to residents of 31 countries in the European Economic Area (EEA). Seven million related to UK residents.”

Information Commissioner Elizabeth Denham, said, “The GDPR makes it clear that organizations 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 so organizations have a legal duty to ensure its security, just like they 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,” she further added.

In a filing with the US Securities Exchange Commission, yesterday, Marriott International’s President and CEO, Arne Sorenson, said, “We are disappointed with this notice of intent from the ICO, which we will contest. Marriott has been cooperating with the ICO throughout its investigation into the incident, which involved a criminal attack against the Starwood guest reservation database.

“We deeply regret this incident happened. We take the privacy and security of guest information very seriously and continue to work hard to meet the standard of excellence that our guests expect from Marriott”, Sorenson added.

He further informed that the Starwood guest reservation database that was attacked is no longer used for business operations.

A few hours after Marriott revealed about the data breach last year, two lawsuits were filed against it. First, by two Oregon men: Chris Harris and David Johnson, for exposing their data, and the other lawsuit was filed in the state of Maryland by a Baltimore law firm Murphy, Falcon & Murphy.

The petitioners in the Oregon lawsuit claimed $12.5 billion in costs and losses; however, the petitioners for the Maryland lawsuit didn't specify the amount for damages they were seeking from Marriott.

According to OregonLive’s post last year, “The lawsuit seeks $12.5 billion -- or $25 for each customer whose privacy may have been jeopardized after making a reservation with Starwood brand hotels, including W Hotels, St. Regis, Sheraton, and Westin”. “The $25 as a minimum value for the time users will spend canceling credit cards due to the Marriott hack”, OregonLive further reported.

Many are happy with ICO’s decision of imposing fines on major companies that put customer data at risk. A user on Reddit has commented, “Finally!! I am hoping this is a trend and a game changer for the companies to better protect their customer information!”. Another user said, “Great news, The GDPR is working.”

To know more about this news in detail, head over to ICO’s official website.

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