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Blackbaud settles breach probe by states for nearly $50M

Posted on October 5, 2023 by Dissent

Steven Ardary reports:

A South Carolina software company has agreed to a multi-million dollar settlement for a 2020 ransomware event that exposed the personal information of millions of consumers in the United States.

South Carolina Attorney General Alan Wilson announced that Blackbaud would pay $49.5 million to states settling allegations that the company violated state consumer protection laws, breach notification laws and HIPAA by not implementing reasonable data security.

Blackbaud’s software connects nonprofit organizations with donors and manages data about their constituents. That data includes contact and demographic information, Social Security numbers, driver’s license numbers, financial information, employment and wealth information, donation history, and protected health information.

A 2020 data breach impacting 13,000 Blackbaud customers exposed the information of their consumers.

Read more at Live5.

Blackbaud issued a press release saying:

Blackbaud (NASDAQ: BLKB), the leading provider of software for powering social impact, today announced it has reached a settlement with 49 state Attorneys General and the District of Columbia related to the previously disclosed multi-state investigation of its 2020 security incident.

“At Blackbaud, protecting customers’ and their constituents’ privacy has always been, and will continue to be, one of our most important priorities,” said Mike Gianoni, president and CEO, Blackbaud. “Cyber-attacks are always evolving, so we are continually strengthening our cybersecurity and compliance programs to ensure our resilience in an ever-changing threat landscape. We are pleased to fully resolve this matter and proud of our role as the essential software provider for purpose-driven organizations.”

With this resolution, Blackbaud has agreed to pay a total of $49.5 million to the 49 states and District of Columbia. In addition, Blackbaud has agreed to comply with applicable laws, not to make misleading statements related to its data protection, privacy, security, confidentiality, integrity, breach notification requirements and similar matters and to implement and improve certain cybersecurity programs and tools.

The settlement amount was fully accrued as a contingent liability in the company’s financial statements as of June 30, 2023. Blackbaud expects to pay the full settlement to each state and the District of Columbia in October 2023 from its existing liquidity. This settlement does not impact Blackbaud’s previously provided 2023 financial guidance.

Additional details can be found in Blackbaud’s Current Report on Form 8-K filed today with the Securities and Exchange Commission.

Category: Health DataSubcontractorU.S.

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