British Airways faces the threat of legal action over the unprecedented data breach that saw 380,000 passengers’ bank details stolen.
The airline is already facing a fine of up to £500 million from the Information Commissioner’s Office for the breach.
Under the European General Data Protection Regulation companies can be fined up to £17 million or four per cent of global turnover, whichever is bigger.
Last year BA’s total revenue was just over £12.2 billion, meaning it could face a fine of £489 million if the ICO takes action.
A law firm now claims that each passenger may be able to claim £1,250, potentially costing the carrier £475 million, The Times reported.
BA has already said it will compensate passengers for any financial loss, including money stolen from bank accounts. The airline has also pledged to pay for a 12-month credit-rating monitoring service for those affected.
BA said: “The airline has guaranteed that financial losses suffered by customers directly because of the theft of this data from British Airways will be reimbursed.”
However, legal firm SPG Law said that it was seeking compensation on behalf of passengers for the “inconvenience, distress and misuse” of their private information.
The UK arm of the US giant Sanders Phillips Grossman claimed that BA should also pay for non-material damage, saying that it was a requirement under the Data Protection Act 2018 and General Data Protection Regulation (GDPR), which came into force in May.
The firm said that its US parent company had already acted against companies including Yahoo, Wendy’s, Target and Anthem over data breaches.
A criminal inquiry into the incident is being led by specialist officers from the National Crime Agency. The ICO is carrying out its own investigation.
SPG Law told the newspaper that it had sent a “letter before action” to BA asking it to begin settlement discussions. The letter says that any failure to do so would be followed by an application for a group litigation order to allow the courts to manage a number of claims against the airline together.
Partner Tom Goodhead reportedly said: “Unfortunately, this is the latest in a number of catastrophic failures in BA’s IT systems.
“Unlike previous failures, however, this data breach has caused serious inconvenience and distress to nearly 400,000 people. BA is liable to compensate for non-material damage under the Data Protection Act 2018 and SPG Law will hold it to account.”
BA was warned earlier this year that it was vulnerable to hackers, according to reports over the weekend.
The airline said that the breach was the result of a “very sophisticated, malicious criminal attack on our website”.
Chairman and chief executive Alex Cruz stressed last week that the carrier acted as quickly as it could.
“We became aware initially on that day and we began to work on it,” he said. “We discovered that something had happened, and immediately we began to work.”
He apologised for the failure, adding that BA was “100% committed” to compensating customers who had been financially affected.
BA admitted that 380,000 customers’ bank details could have been stolen from its website and app
Passengers’ data had been compromised from 10.58pm on August 21 until the breach was discovered and stopped at 9.45pm on Wednesday last week.