'Wi-fi poses huge legal risk', warns City lawyer

A leading City law firm has warned companies they could face huge legal costs if they fail to protect their staff and their business against the threats which lie in wait for users of public wi-fi networks.

The UK has not seen any litigation along these lines but law firm Charles Russell has warned it may only be a matter of time if companies do not get on top of the problem of staff accessing business critical systems and sending unsecured data over public networks.

Robin Bynoe, partner at Charles Russell, said: "The country's hotels and waiting rooms are full of people rummaging through the contents of each others' laptops."

The effects of this browsing could be very damaging to a business - ranging from theft of data or intellectual property from the company to exposing third party, client or partner data – which poses not only financial but also 'reputational' risk.

Bynoe used the example of a law firm, suggesting that a lawyer with sensitive details of a proposed takeover by a client could cause "multi-million pound losses" if those details are leaked and the share price or deal affected.

Bynoe told silicon.com: "There is potentially enormous liability there."

He said it is a problem which needs to be squeezed on two fronts, with companies securing devices but also introducing effective legalese into their business contracts.

Bynoe said: "Whenever wi-fi access is available, there are several organisations involved: the site owner, the service provider, the person with the laptop, their employer, the client or the contact with the valuable data. If yours is the only organisation that doesn't have the necessary wording in all relevant contracts and data is stolen, you could end up shouldering the whole of the liability for the loss."

Bynoe added liability may also exist where an individual suffers damages as a result of using their work laptop on a wi-fi network, if such behaviour is approved of by their bosses and no action is taken to alert them to the risks. He said companies should therefore have taken demonstrable steps to educate and protect staff.

He told silicon.com: "It's important employers tell employees about the risks they face."

Graeme Powell, European managing director of iBAHN who provides hotels with secure wi-fi networks and worked with Charles Russell on compiling the research, said companies now need to play catch up in regards to employees whose adoption of wireless working has overtaken their risk management.

Powell said: "Ignoring wi-fi security for your remote workers is akin to putting a sign outside the door and saying 'take what you want'."