Questions mount over Cathay Pacific data breach admission
Confident Tesla looks to Europe and China
HONG Kong carrier Cathay Pacific came under pressure on Thursday to explain why it had taken five months to admit it had been hacked and compromised the data of 9.4 million customers, including passport numbers and credit card details.
The airline said on Wednesday it had discovered suspicious activity on its network in March and confirmed unauthorised access to certain personal data in early May.
However, chief customer and commercial officer Paul Loo said officials wanted to have an accurate grasp on the situation before making an announcement and did not wish to “create unnecessary panic”.
News of the leak sent shares in Cathay, which was already under pressure as it struggles for customers, plunging more than six per cent to a nine-year low in Hong Kong trading.
Local politicians slammed the carrier, saying its response had only fuelled worries.
“Whether the panic is necessary or not is not for them to decide, it is for the victim to decide. This is not a good explanation at all to justify the delay,” said IT sector lawmaker Charles Mok.
And legislator Elizabeth Quat said the delay was “unacceptable” as it meant customers missed five months of opportunities to take steps to safeguard their personal data.
Probe launched
The airline admitted about 860,000 passport numbers, 245,000 Hong Kong identity card numbers, 403 expired credit card numbers and 27 credit card numbers with no card verification value (CVV ) were accessed.
Other compromised passenger data included nationalities, dates of births, phone numbers, emails, and physical addresses.
“We have no evidence that any personal data has been misused. No-one’s travel or loyalty profile was accessed in full, and no passwords were compromised,” chief executive Rupert Hogg said in a statement on Wednesday.
But Mok said the public needs to know how the company can prove that was the case.
“Such a statement doesn’t give people absolute confidence that we are completely safe, and it doesn’t mean that some of this data would not be misused later,” Mok said.
He also pointed out that the EU’s new General Data Protection Regulation says any such breach should be reported within 72 hours.
Hong Kong’s privacy commissioner Stephen Wong expressed “serious concern” over the breach in a statement on Thursday and said the office would initiate a compliance check with the airline.
“Organisations in general that amass and derive benefits from personal data should ditch the mindset of conducting their operations to meet the minimum regulatory requirements only,” Wong said.
“They should instead be held to a higher ethical standard that meets the stakeholders’ expectations alongside the requirements of laws and regulations,” he added.
Cathay said it had launched an investigation and alerted the police after an ongoing IT operation revealed unauthorised access of systems containing the passenger data.
The company is in the process of contacting affected passengers and providing them with solutions to protect themselves.
Struggling business
Cathay Pacific is already battling to stem major losses as it comes under pressure from lower-cost Chinese carriers and Middle East rivals.
It booked its first back-to-back annual loss in its seven-decade history in March, and has previously pledged to cut 600 staff including a quarter of its management as part of its biggest overhaul in years.
The troubled airline did not mention financial compensation for passengers affected by the data leak, but British Airways pledged to compensate customers when the UK flag carrier suffered a data hack last month.
BA revealed in September that personal and financial details of about 380,000 customers over several weeks had been stolen.
The leak is the latest to hit global companies in recent years.
Facebook revealed last month that up to 50 million accounts were breached by hackers, while ridesharing giant Uber was vilified after a breach in 2016 of data on 57 million of its users was revealed only in November last year.
In April, the holding company of Yahoo was fined $35 million by US regulators because it had not informed them until this year that hackers had stolen “crown jewel” data.
And in US credit bureau Equifax identified almost 150 million American consumers’ personal details had been exposed by a massive data breach that had sparked a public outcry. ELECTRIC car maker Tesla on Wednesday reported an “historic” quarterly profit driven by demand for its mass market Model 3, as the company looks beyond its US home base to Europe and China.
Tesla chief execut ive Elon Musk sa id he ex pect s t he company to stay prof itable from this point for ward, and appeared to ca lm fears about his behaviour, company debt, a nd snags ra mping up production line ef f iciency.
Musk said he expected Tesla to make even more Model 3 vehicles in the current quarter, a nd to beg i n del iver i ng the cars in Europe and China early next year.
“I am incredibly excited about what lies ahead,” Musk said in an earnings call with analysts.
Tesla said net income reached $311.5 million on revenue that more than doubled year-onyear to $6.8 billion in the quarter that ended September 30.
The earnings beat Wall Street expectations that Tesla would take in less money in the quarter and log another loss.
For the same period a year ago the company reported a loss of $619 million.
“The third quarter of this year was a truly historic quarter for Tesla,” said the flamboyant Musk, who also heads SpaceX.
“Model 3 was the best-selling car in the US in terms of revenue and the fifth best-selling car in terms of volume.”
Tesla’s assembly l i ne produced a n average of 4,300 ca rs week ly i n t he qua r ter, nea r i ng a goa l set a whi le back by Musk.
Tesla ha s a l so i mproved ef f icienc y, ra mping up t he g ross ma rg i n on Model 3 vehicles to more than 20 per cent, according to Musk.
“Model 3 is attracting customers of both premium and non-premium brands, making it a truly mainstream product,” Musk said, adding that the company’s “earnings profile has flipped dramatically.”
Tesla executives expect to begin delivering Model 3 cars in Europe in the first quarter of next year, and in China by the second quarter.
Production will initially take place in California, but Tesla is “moving rapidly” to get production going in China and wants to have that going next year, according to Musk.
“We will also have a factory in Europe long term, because it is pretty silly to make cars in California and ship them to Europe,” Musk said.