Lost Electronic Devices and Your Liability

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When police in Albury, Australia recently recovered a lost iPhone without any security activated, they thought it would be a good opportunity to teach its owner, and others, a lesson on the importance smartphone security. One officer snapped a selfie and added it to the owners Facebook page with the caption "You should probably put a password on your phone. When you are ready to pick it up it will be at Albury police station.” The post was a hit gathering nearly 150 likes and shares.

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Spurred on by the response, the cops posted a few more photos, many with punny captions. Six hours later the owner reported to the station to pick up her phone. This is a cute story with a happy ending…but it could have worked out differently.

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Like the Utah mother who says her children's photos were copied from Facebook, placed on a fake Instagram profile, and distributed to porn websites via tagging…or the Houston woman’s photos that ended up on a sex site, a smartphone that is not secure gives ANYONE access to the owners digital life. The ease with which the Albury police were able to post photos to another person’s facebook account demonstrates how vulnerable our personal data is.

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A recent research study by Javelin Research indicated that smartphone users are 33% more likely to become a victim of identity theft than non-users. That same study found that 62% of smartphone users do not use password protection, allowing anyone who finds or steals their phone to have access to its contents.

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Now think about the devices that are under your care and keeping in your lost and found or property and evidence room. Would the owners of those devices want you to protect their personal data? YES! This is especially true when a device is unclaimed.

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While states have limited an establishment’s liability on items left behind by guests, in most cases, the same law makes a provision for negligence. In other words, if the establishment is found to be negligent in handling the guest’s lost item, there is no such limit.

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Could it be considered negligence if a smartphone, in the control of a lost and found department, was given to someone, who then easily accessed the data and harmed the original owner? Could an establishment be found negligent, if intimate pictures from a guest’s lost tablet were posted on a pornographic website? Would a company be negligent, if money was stolen from a guest’s bank account, using their lost smartphone?

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While no one can say conclusively what a court would decide, this fact remains: there is potential liability in each of the cases mentioned above. What liability? The most obvious is being found negligent in a court proceeding, but, we must also consider the court of public opionion.

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Imagine – if a teenagers intimate selfies were posted on a social network site, because a hotel gave her lost smartphone to the employee that found it, BEFORE making certain that private data was deleted. That would be a newsworthy event, and certainly one that would catch the public’s eye. How would that property fare in the court of public opinion? Certainly there would be damage, how much is anybody’s guess. The fact is, this type of liability can easily be mitigated or avoided all together. How?

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First, document your disposal process, making sure your electronic devices are being properly data wiped. If you donate these items to charity, make sure they have a documented process in place. Most charities are simply a “pass through” to a for profit organization. The charity effectively sells the devices to a for profit company.

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Second, occasionally follow up with your processor. Call and ask questions about how your devices are being handled. How many have been processed? What have been the results of the devices that have been sent in? Are broken devices being disposed of in an environmentally responsible manner?

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Finally, let your team members and guests know how you handle these devices. Announce your disposal process to the staff…ask marketing to generate a press release…put the information on your website…let future guests know that you care about their privacy and security.

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