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Marriott stock retreat deepens after data breach affects 500 mln guests

After digital media, the industry that depends so much on customers’ personal information might be the hospitality sector. While the safety of such information is of paramount importance, recent developments indicate the concept of a foolproof cyber-security system is an illusion.

On the heels of tech firms Facebook (FB) and Google (GOOG) facing regulatory action for sharing or failing to secure user information, Maryland-headquartered hotel chain Marriott (MAR) this week disclosed that personal information of more than 500 million guests was compromised in a data breach that dates back to 2014 and continued unchecked.

Following the revelation, Marriott’s shares suffered their biggest intraday loss in recent times on Friday and traded down 5% in the early hours. The hotel giant, which has been thriving on the strength of the growing economy, recently came up with a not-so-impressive outlook for fiscal 2019. Considering the fact that the hospitality sector follows a cyclical pattern, the guidance triggered concerns that the sector might be approaching the bearish territory.

Marriott shares suffered their biggest intraday loss in recent times on Friday and traded down 5% in the early hours

According to the company, it was found earlier this month that personal data of guests who made reservations at its Starwood properties were exposed. The investigation, launched in September this year following an alert, showed that hackers had accessed the guest reservation database illegally for more than four years. Meanwhile, efforts are on to decrypt the information that was copied to external systems.

The consequences of the leak could be serious if the hackers managed to access sensitive information such as payment card numbers and their expiry dates, which some of the guests had shared. The incident has been brought to the notice of the regulators.

Marriott International stock falls on weak Q3 top line

Marriott became the largest hotel chain two years ago after it acquired Starwood Hotels for $13 billion. The fast adoption of electronic payment systems is opening fresh opportunities for cybercriminals. Hotels are among the most vulnerable entities to cyber-attacks, considering the large amounts exchanged digitally.

Last year, hackers targeted Hyatt and leaked credit card details of guests who had made reservations in a dozen countries. Earlier, InterContinental Hotels faced a similar attack in which the payment card details of several guests were leaked.

 

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