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What is Sensitive Data Exposure and How to Prevent It

January 1, 2024
6
 Min Read
Data Security

What is Sensitive Data Exposure?

Sensitive data exposure occurs when security measures fail to protect sensitive information from external and internal threats. This leads to unauthorized disclosure of private and confidential data. Attackers often target personal data, such as financial information and healthcare records, as it is valuable and exploitable.

Security teams play a critical role in mitigating sensitive data exposures. They do this by implementing robust security measures. This includes eliminating malicious software, enforcing strong encryption standards, and enhancing access controls. Yet, even with the most sophisticated security measures in place, data breaches can still occur. They often happen through the weakest links in the system.

Organizations must focus on proactive measures to prevent data exposures. They should also put in place responsive strategies to effectively address breaches. By combining proactive and responsive measures, as stated below, organizations can protect sensitive data exposure. They can also maintain the trust of their customers.

Proactive Measures Responsive Strategies
Implementation of appropriate security posture controls for sensitive data, such as encryption, data masking, de-identification, etc. Security audits with patch management ensure the masking of affected data to minimize the attack surface and eradicate threats.
Sensitive data access restrictions through least privilege principles enforcement. Promptly identifying and reacting through incident response systems with adequate alerting.
Enablement of comprehensive logging mechanisms to capture and monitor activities on sensitive data. Investigating the root cause of the breach to prevent similar incidents from occurring in the future.
Alignment with cyber protection regulations and compliance requirements through adherence to strict cyber policies. Implementing additional custom security measures to strengthen the overall security posture.

Difference Between Data Exposure and Data Breach

Both data exposure and data breaches involve unauthorized access or disclosure of sensitive information. However, they differ in their intent and the underlying circumstances.

Data Exposure

Data exposure occurs when sensitive information is inadvertently disclosed or made accessible to unauthorized individuals or entities. This exposure can happen due to various factors. These include misconfigured systems, human error, or inadequate security measures. Data exposure is typically unintentional. The exposed data may not be actively targeted or exploited.

Data Breach

A data breach, on the other hand, is a deliberate act of unauthorized access to sensitive information with the intent to steal, manipulate, or exploit it. Data breaches are often carried out by cybercriminals or malicious actors seeking financial gain, identity theft, or to disrupt an organization's operations.

Key Differences

The table below summarizes the key differences between sensitive data exposure and data breaches:

Features Data Exposure Data Breach
Intent Unintentional Intentional
Underlying Factor Human error, misconfigured systems, inadequate security Deliberate attacks by cybercriminals or malicious actors
Impact Can still lead to privacy violations and reputational damage Often more severe impacts, including fraud and financial losses, identity theft, and disruption of operations
Solutions Following security best practices, continuous monitoring and SecOps literacy Robust security measures with discrete monitoring and alerting for anomaly detection and remediation

Types of Sensitive Data Exposure

Attackers relentlessly pursue sensitive data. They create increasingly sophisticated and inventive methods to breach security systems and compromise valuable information. Their motives range from financial gain to disruption of operations. Ultimately, this causes harm to individuals and organizations alike. There are three main types of data breaches that can compromise sensitive information:

Availability Breach

An availability breach occurs when authorized users are temporarily or permanently denied access to sensitive data. Ransomware commonly uses this method to extort organizations. Such disruptions can impede business operations and hinder essential services. They can also result in financial losses. Addressing and mitigating these breaches is essential to ensure uninterrupted access and business continuity.

Confidentiality Breach

A confidentiality breach occurs when unauthorized entities access sensitive data, infringing upon its privacy and confidentiality. The consequences can be severe. They can include financial fraud, identity theft, reputational harm, and legal repercussions. It's crucial to maintain strong security measures. Doing so prevents breaches and preserves sensitive information's integrity.

Integrity Breach

An integrity breach occurs when unauthorized individuals or entities alter or modify sensitive data. AI LLM training is particularly vulnerable to this breach form. This compromises the data's accuracy and reliability. This manipulation of data can result in misinformation, financial losses, and diminished trust in data quality. Vigilant measures are essential to protect data integrity. They also help reduce the impact of breaches.

How Sensitive Data Gets Exposed

Sensitive data, including vital information like Personally Identifiable Information (PII), financial records, and healthcare data, forms the backbone of contemporary organizations. Unfortunately, weak encryption, unreliable application programming interfaces, and insufficient security practices from development and security teams can jeopardize this invaluable data. Such lapses lead to critical vulnerabilities, exposing sensitive data at three crucial points:

Data in Transit

Data in transit refers to the transfer of data between locations, such as from a user's device to a server or between servers. This data is a prime target for attackers due to its often unencrypted state, making it vulnerable to interception. Key factors contributing to data exposure in transit include weak encryption, insecure protocols, and the risk of man-in-the-middle attacks. It is crucial to address these vulnerabilities to enhance the security of data during transit.

Data at Rest

While data at rest is less susceptible to interception than data in transit, it remains vulnerable to attacks. Enterprises commonly face internal exposure to sensitive data when they have misconfigurations or insufficient access controls on data at rest. Oversharing and insufficient access restrictions heighten the risk in data lakes and warehouses that house Personally Identifiable Information (PII). To mitigate this risk, it is important to implement robust access controls and monitoring measures. This ensures restricted access and vigilant tracking of data access patterns.

Data in Use

Data in use is the most vulnerable to attack, as it is often unencrypted and can be accessed by multiple users and applications. When working in cloud computing environments, dev teams usually gather the data and cache it within the mounts or in-memory to boost performance and reduce I/O. Such data causes sensitive data exposure vulnerabilities as other teams or cloud providers can access the data. The security teams need to adopt standard data handling practices. For example, they should clean the data from third-party or cloud mounts after use and disable caching.

What Causes Sensitive Data Exposure?

Sensitive data exposure results from a combination of internal and external factors. Internally, DevSecOps and Business Analytics teams play a significant role in unintentional data exposures. External threats usually come from hackers and malicious actors. Mitigating these risks requires a comprehensive approach to safeguarding data integrity and maintaining a resilient security posture.

Internal Causes of Sensitive Data Exposure

  • No or Weak Encryption: Encryption and decryption algorithms are the keys to safeguarding data. Sensitive data exposures occur due to weak cryptography protocols. They also occur due to a lack of encryption or hashing mechanisms.
  • Insecure Passwords: Insecure password practices and insufficient validation checks compromise enterprise security, facilitating data exposure.
  • Unsecured Web Pages: JSON payloads get delivered from web servers to frontend API handlers. Attackers can easily exploit the data transaction between the server and client when users browse unsecure web pages with weak SSL and TLS certificates.
  • Poor Access Controls and Misconfigurations: Insufficient multi-factor authentication (MFA) or excessive permissioning and unreliable security posture management contribute to sensitive data exposure through misconfigurations.
  • Insider Threat Attacks: Current or former employees may unintentionally or intentionally target data, posing risks to organizational security and integrity.

External Causes of Sensitive Data Exposure

  • SQL Injection: SQL Injection happens when attackers introduce malicious queries and SQL blocks into server requests. This lets them tamper with backend queries to retrieve or alter data, causing SQL injection attacks.
  • Network Compromise: A network compromise occurs when unauthorized users gain control of backend services or servers. This compromises network integrity, risking resource theft or data alteration.
  • Phishing Attacks: Phishing attacks contain malicious links. They exploit urgency, tricking recipients into disclosing sensitive information like login credentials or personal details.
  • Supply Chain Attacks: When compromised, Third-party service providers or vendors exploit the dependent systems and unintentionally expose sensitive data publicly.

Impact of Sensitive Data Exposure

Exposing sensitive data poses significant risks. It encompasses private details like health records, user credentials, and biometric data. Accountability, governed by acts like the Accountability Act, mandates organizations to safeguard granular user information. Failure to prevent unauthorized exposure can result in severe consequences. This can include identity theft and compromised user privacy. It can also lead to regulatory and legal repercussions and potential corruption of databases and infrastructure. Organizations must focus on stringent measures to mitigate these risks.

Data table on the impact of sensitive data exposure and its severity.

Examples of Sensitive Data Exposure

Prominent companies, including Atlassian, LinkedIn, and Dubsmash, have unfortunately become notable examples of sensitive data exposure incidents. Analyzing these cases provides insights into the causes and repercussions of such data exposure. It offers valuable lessons for enhancing data security measures.

Atlassian Jira (2019)

In 2019, Atlassian Jira, a project management tool, experienced significant data exposure. The exposure resulted from a configuration error. A misconfiguration in global permission settings allowed unauthorized access to sensitive information. This included names, email addresses, project details, and assignee data. The issue originated from incorrect permissions granted during the setup of filters and dashboards in JIRA.

LinkedIn (2021)

LinkedIn, a widely used professional social media platform, experienced a data breach where approximately 92% of user data was extracted through web scraping. The security incident was attributed to insufficient webpage protection and the absence of effective mechanisms to prevent web crawling activity.

Equifax (2017)

In 2017, Equifax Ltd., the UK affiliate of credit reporting company Equifax Inc., faced a significant data breach. Hackers infiltrated Equifax servers in the US, impacting over 147 million individuals, including 13.8 million UK users. Equifax failed to meet security obligations. It outsourced security management to its US parent company. This led to the exposure of sensitive data such as names, addresses, phone numbers, dates of birth, Equifax membership login credentials, and partial credit card information.

Cost of Compliance Fines

Data exposure poses significant risks, whether at rest or in transit. Attackers target various dimensions of sensitive information. This includes protected health data, biometrics for AI systems, and personally identifiable information (PII). Compliance costs are subject to multiple factors influenced by shifting regulatory landscapes. This is true regardless of the stage.

Enterprises failing to safeguard data face substantial monetary fines or imprisonment. The penalty depends on the impact of the exposure. Fines can range from millions to billions, and compliance costs involve valuable resources and time. Thus, safeguarding sensitive data is imperative for mitigating reputation loss and upholding industry standards.

How to Determine if You Are Vulnerable to Sensitive Data Exposure?

Detecting security vulnerabilities in the vast array of threats to sensitive data is a challenging task. Unauthorized access often occurs due to lax data classification and insufficient access controls. Enterprises must adopt additional measures to assess their vulnerability to data exposure.

Deep scans, validating access levels, and implementing robust monitoring are crucial steps. Detecting unusual access patterns is crucial. In addition, using advanced reporting systems to swiftly detect anomalies and take preventive measures in case of a breach is an effective strategy. It proactively safeguards sensitive data.

Automation is key as well - to allow burdened security teams the ability to keep pace with dynamic cloud use and data proliferation. Automating discovery and classification, freeing up resources, and doing so in a highly autonomous manner without requiring huge setup and configuration efforts can greatly help.

How to Prevent Sensitive Data Exposure

Effectively managing sensitive data demands rigorous preventive measures to avert exposure. Widely embraced as best practices, these measures serve as a strategic shield against breaches. The following points focus on specific areas of vulnerability. They offer practical solutions to either eliminate potential sensitive data exposures or promptly respond to them:

Assess Risks Associated with Data

The initial stages of data and access onboarding serve as gateways to potential exposure. Conducting a thorough assessment, continual change monitoring, and implementing stringent access controls for critical assets significantly reduces the risks of sensitive data exposure. This proactive approach marks the first step to achieving a strong data security posture.

Minimize Data Surface Area

Overprovisioning and excessive sharing create complexities. This turns issue isolation, monitoring, and maintenance into challenges. Without strong security controls, every part of the environment, platform, resources, and data transactions poses security risks. Opting for a less-is-more approach is ideal. This is particularly true when dealing with sensitive information like protected health data and user credentials. By minimizing your data attack surface, you mitigate the risk of cloud data leaks.

Store Passwords Using Salted Hashing Functions and Leverage MFA

Securing databases, portals, and services hinges on safeguarding passwords. This prevents unauthorized access to sensitive data. It is crucial to handle password protection and storage with precision. Use advanced hashing algorithms for encryption and decryption. Adding an extra layer of security through multi-factor authentication strengthens the defense against potential breaches even more.

Disable Autocomplete and Caching

Cached data poses significant vulnerabilities and risks of data breaches. Enterprises often use auto-complete features, requiring the storage of data on local devices for convenient access. Common instances include passwords stored in browser sessions and cache. In cloud environments, attackers exploit computing instances. They access sensitive cloud data by exploiting instances where data caching occurs. Mitigating these risks involves disabling caching and auto-complete features in applications. This effectively prevents potential security threats.

Fast and Effective Breach Response

Instances of personal data exposure stemming from threats like man-in-the-middle and SQL injection attacks necessitate swift and decisive action. External data exposure carries a heightened impact compared to internal incidents. Combatting data breaches demands a responsive approach. It's often facilitated by widely adopted strategies. These include Data Detection and Response (DDR), Security Orchestration, Automation, and Response (SOAR), User and Entity Behavior Analytics (UEBA), and the renowned Zero Trust Architecture featuring Predictive Analytics (ZTPA).

Tools to Prevent Sensitive Data Exposure

Shielding sensitive information demands a dual approach—internally and externally. Unauthorized access can be prevented through vigilant monitoring, diligent analysis, and swift notifications to both security teams and affected users. Effective tools, whether in-house or third-party, are indispensable in preventing data exposure.

Data Security Posture Management (DSPM) is designed to meet the changing requirements of security, ensuring a thorough and meticulous approach to protecting sensitive data. Tools compliant with DSPM standards usually feature data tokenization and masking, seamlessly integrated into their services. This ensures that data transmission and sharing remains secure.

These tools also often have advanced security features. Examples include detailed access controls, specific access patterns, behavioral analysis, and comprehensive logging and monitoring systems. These features are essential for identifying and providing immediate alerts about any unusual activities or anomalies.

Sentra emerges as an optimal solution, boasting sophisticated data discovery and classification capabilities. It continuously evaluates data security controls and issues automated notifications. This addresses critical data vulnerabilities ingrained in its core.

Conclusion

In the era of cloud transformation and digital adoption, data emerges as the driving force behind innovations. Personal Identifiable Information (PII), which is a specific type of sensitive data, is crucial for organizations to deliver personalized offerings that cater to user preferences. The value inherent in data, both monetarily and personally, places it at the forefront, and attackers continually seek opportunities to exploit enterprise missteps.

Failure to adopt secure access and standard security controls by data-holding enterprises can lead to sensitive data exposure. Unaddressed, this vulnerability becomes a breeding ground for data breaches and system compromises. Elevating enterprise security involves implementing data security posture management and deploying robust security controls. Advanced tools with built-in data discovery and classification capabilities are essential to this success. Stringent security protocols fortify the tools, safeguarding data against vulnerabilities and ensuring the resilience of business operations.

If you want to learn more about how you can prevent sensitive data exposure, request a demo with our data security experts today.

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Discover Ron’s expertise, shaped by over 20 years of hands-on tech and leadership experience in cybersecurity, cloud, big data, and machine learning. As a serial entrepreneur and seed investor, Ron has contributed to the success of several startups, including Axonius, Firefly, Guardio, Talon Cyber Security, and Lightricks, after founding a company acquired by Oracle.

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Nikki Ralston
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Supercharging DLP with Automatic Data Discovery & Classification of Sensitive Data

Supercharging DLP with Automatic Data Discovery & Classification of Sensitive Data

Data Loss Prevention (DLP) is a keystone of enterprise security, yet traditional DLP solutions continue to suffer from high rates of both false positives and false negatives, primarily because they struggle to accurately identify and classify sensitive data in cloud-first environments.

New advanced data discovery and contextual classification technology directly addresses this gap, transforming DLP from an imprecise, reactive tool into a proactive, highly effective solution for preventing data loss.

Why DLP Solutions Can’t Work Alone

DLP solutions are designed to prevent sensitive or confidential data from leaving your organization, support regulatory compliance, and protect intellectual property and reputation. A noble goal indeed.  Yet DLP projects are notoriously anxiety-inducing for CISOs. On the one hand,  they often generate a high amount of false positives that disrupt legitimate business activities and further exacerbate alert fatigue for security teams.

What’s worse than false positives? False negatives. Today traditional DLP solutions too often fail to prevent data loss because they cannot efficiently discover and classify sensitive data in dynamic, distributed, and ephemeral cloud environments.

Traditional DLP faces a twofold challenge: 

  • High False Positives: DLP tools often flag benign or irrelevant data as sensitive, overwhelming security teams with unnecessary alerts and leading to alert fatigue.

  • High False Negatives: Sensitive data is frequently missed due to poor or outdated classification, leaving organizations exposed to regulatory, reputational, and operational risks.

These issues stem from DLP’s reliance on basic pattern-matching, static rules, and limited context. As a result, DLP cannot keep pace with the ways organizations use, store, and share data, resulting in the dual-edged sword of both high false positives and false negatives. Furthermore, the explosion of unstructured data types and shadow IT creates blind spots that traditional DLP solutions cannot detect. As a result, DLP often can’t  keep pace with the ways organizations use, store, and share data. It isn’t that DLP solutions don’t work, rather they lack the underlying discovery and classification of sensitive data needed to work correctly.

AI-Powered Data Discovery & Classification Layer

Continuous, accurate data classification is the foundation for data security. An AI-powered data discovery and classification platform can act as the intelligence layer that makes DLP work as intended. Here’s how Sentra complements the core limitations of DLP solutions:

1. Continuous, Automated Data Discovery

  • Comprehensive Coverage: Discovers sensitive data across all data types and locations - structured and unstructured sources, databases, file shares, code repositories, cloud storage, SaaS platforms, and more.

  • Cloud-Native & Agentless: Scans your entire cloud estate (AWS, Azure, GCP, Snowflake, etc.) without agents or data leaving your environment, ensuring privacy and scalability.
  • Shadow Data Detection: Uncovers hidden or forgotten (“shadow”) data sets that legacy tools inevitably miss, providing a truly complete data inventory.

2. Contextual, Accurate Classification

  • AI-Driven Precision: Sentra proprietary LLMs and hybrid models achieve over 95% classification accuracy, drastically reducing both false positives and false negatives.

  • Contextual Awareness: Sentra goes beyond simple pattern-matching to truly understand business context, data lineage, sensitivity, and usage, ensuring only truly sensitive data is flagged for DLP action.
  • Custom Classifiers: Enables organizations to tailor classification to their unique business needs, including proprietary identifiers and nuanced data types, for maximum relevance.

3. Real-Time, Actionable Insights

  • Sensitivity Tagging: Automatically tags and labels files with rich metadata, which can be fed directly into your DLP for more granular, context-aware policy enforcement.

  • API Integrations: Seamlessly integrates with existing DLP, IR, ITSM, IAM, and compliance tools, enhancing their effectiveness without disrupting existing workflows.
  • Continuous Monitoring: Provides ongoing visibility and risk assessment, so your DLP is always working with the latest, most accurate data map.

How Sentra Supercharges DLP Solutions

How Sentra supercharges DLP solutions

Better Classification Means Less Noise, More Protection

  • Reduce Alert Fatigue: Security teams focus on real threats, not chasing false alarms, which results in better resource allocation and faster response times.

  • Accelerate Remediation: Context-rich alerts enable faster, more effective incident response, minimizing the window of exposure.

  • Regulatory Compliance: Accurate classification supports GDPR, PCI DSS, CCPA, HIPAA, and more, reducing audit risk and ensuring ongoing compliance.

  • Protect IP and Reputation: Discover and secure proprietary data, customer information, and business-critical assets, safeguarding your organization’s most valuable resources.

Why Sentra Outperforms Legacy Approaches

Sentra’s hybrid classification framework combines rule-based systems for structured data with advanced LLMs and zero-shot learning for unstructured and novel data types.

This versatility ensures:

  • Scalability: Handles petabytes of data across hybrid and multi-cloud environments, adapting as your data landscape evolves.
  • Adaptability: Learns and evolves with your business, automatically updating classifications as data and usage patterns change.
  • Privacy: All scanning occurs within your environment - no data ever leaves your control, ensuring compliance with even the strictest data residency requirements.

Use Case: Where DLP Alone Fails, Sentra Prevails

A financial services company uses a leading DLP solution to monitor and prevent the unauthorized sharing of sensitive client information, such as account numbers and tax IDs, across cloud storage and email. The DLP is configured with pattern-matching rules and regular expressions for identifying sensitive data.

What Goes Wrong:


An employee uploads a spreadsheet to a shared cloud folder. The spreadsheet contains a mix of client names, account numbers, and internal project notes. However, the account numbers are stored in a non-standard format (e.g., with dashes, spaces, or embedded within other text), and the file is labeled with a generic name like “Q2_Projects.xlsx.” The DLP solution, relying on static patterns and file names, fails to recognize the sensitive data and allows the file to be shared externally. The incident goes undetected until a client reports a data breach.

How Sentra Solves the Problem:


To address this, the security team set out to find a solution capable of discovering and classifying unstructured data without creating more overhead. They selected Sentra for its autonomous ability to continuously discover and classify all types of data across their hybrid cloud environment. Once deployed, Sentra immediately recognizes the context and content of files like the spreadsheet that enabled the data leak. It accurately identifies the embedded account numbers—even in non-standard formats—and tags the file as highly sensitive.

This sensitivity tag is automatically fed into the DLP, which then successfully enforces strict sharing controls and alerts the security team before any external sharing can occur. As a result, all sensitive data is correctly classified and protected, the rate of false negatives was dramatically reduced, and the organization avoids further compliance violations and reputational harm.

Getting Started with Sentra is Easy

  1. Deploy Agentlessly: No complex installation. Sentra integrates quickly and securely into your environment, minimizing disruption.

  2. Automate Discovery & Classification: Build a living, accurate inventory of your sensitive data assets, continuously updated as your data landscape changes.

  3. Enhance DLP Policies: Feed precise, context-rich sensitivity tags into your DLP for smarter, more effective enforcement across all channels.

  4. Monitor Continuously: Stay ahead of new risks with ongoing discovery, classification, and risk assessment, ensuring your data is always protected.

“Sentra’s contextual classification engine turns DLP from a reactive compliance checkbox into a proactive, business-enabling security platform.”

Fuel DLP with Automatic Discovery & Classification

DLP is an essential data protection tool, but without accurate, context-aware data discovery and classification, it’s incomplete and often ineffective. Sentra supercharges your DLP with continuous data discovery and accurate classification, ensuring you find and protect what matters most—while eliminating noise, inefficiency, and risk. 

Ready to see how Sentra can supercharge your DLP? Contact us for a demo today.

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Ghosts in the Model: Uncovering Generative AI Risks

Ghosts in the Model: Uncovering Generative AI Risks

As artificial intelligence (AI) becomes deeply integrated into enterprise workflows, organizations are increasingly leveraging cloud-based AI services to enhance efficiency and decision-making.

In 2024, 56% of organizations adopted AI to develop custom applications, with 39% of Azure users leveraging Azure OpenAI services. However, with rapid AI adoption in cloud environments, security risks are escalating. As AI continues to shape business operations, the security and privacy risks associated with cloud-based AI services must not be overlooked. Understanding these risks (and how to mitigate them) is essential for organizations looking to protect their proprietary models and sensitive data.

When discussing AI services in cloud environments, there are two primary types of services that introduce different types of security and privacy risks. This article dives into these risks and explores best practices to mitigate them, ensuring organizations can leverage AI securely and effectively.

1. Leading Generative AI Platforms & Their Business Applications

Examples include OpenAI, Google, Meta, and Microsoft, which develop large-scale AI models and provide AI-related services, such as Azure OpenAI, Amazon Bedrock, Google’s Bard, Microsoft Copilot Studio. These services allow organizations to build AI Agents and GenAI services that  are designed to help users perform tasks more efficiently by integrating with existing tools and platforms. For instance, Microsoft Copilot can provide writing suggestions, summarize documents, or offer insights within platforms like Word or Excel.

What is RAG (Retrieval-Augmented Generation)?

Many AI systems use Retrieval-Augmented Generation (RAG) to improve accuracy. Instead of solely relying on a model’s pre-trained knowledge, RAG allows the system to fetch relevant data from external sources, such as a vector database, using algorithms like k-nearest neighbor. This retrieved information is then incorporated into the model’s response.

When used in enterprise AI applications, RAG enables AI agents to provide contextually relevant responses. However, it also introduces a risk - if access controls are too broad, users may inadvertently gain access to sensitive corporate data.

How Does RAG (Retrieval-Augmented Generation) Apply to AI Agents?

In AI agents, RAG is typically used to enhance responses by retrieving relevant information from a predefined knowledge base.

Example: In AWS Bedrock, you can define a serverless vector database in OpenSearch as a knowledge base for a custom AI agent. This setup allows the agent to retrieve and incorporate relevant context dynamically, effectively implementing RAG.

Security Risks of Generative AI Platforms

Custom generative AI applications, such as AI agents or enterprise-built copilots, are often integrated with organizational knowledge bases like Amazon S3, SharePoint, Google Drive, and other data sources. While these models are typically not directly trained on sensitive corporate data, the fact that they can access these sources creates significant security risks.

One potential risk is data exposure through prompts, but this only arises under certain conditions. If access controls aren’t properly configured, users interacting with AI agents might unintentionally or maliciously - prompt the model to retrieve confidential or private information.This isn’t limited to cleverly crafted prompts; it reflects a broader issue of improper access control and governance.

Configuration and Access Control Risks

The configuration of the AI agent is a critical factor. If an agent is granted overly broad access to enterprise data without proper role-based restrictions, it can return sensitive information to users who lack the necessary permissions. For instance, a model connected to an S3 bucket with sensitive customer data could expose that data if permissions aren’t tightly controlled.

A common scenario might involve an AI agent designed for Sales that has access to personally identifiable information (PII) or customer records. If the agent is not properly restricted, it could be queried by employees outside of Sales, such as developers - who should not have access to that data.

Example Risk Scenario

An employee asks a Copilot-like agent to summarize company-wide sales data. The AI returns not just high-level figures, but also sensitive customer or financial details that were unintentionally exposed due to lax access controls.

Challenges in Mitigating These Risks

The core challenge, particularly relevant to platforms like Sentra, is enforcing governance to ensure only appropriate data is used and accessible by AI services.

This includes:

  • Defining and enforcing granular data access controls.
  • Preventing misconfigurations or overly permissive settings.
  • Maintaining real-time visibility into which data sources are connected to AI models.
  • Continuously auditing data flows and access patterns to prevent leaks.

Without rigorous governance and monitoring, even well-intentioned GenAI implementations can lead to serious data security incidents.

2. ML and AI Studios for Building New Models

Many companies, such as large financial institutions, build their own AI and ML models to make better business decisions, or to improve their user experiences. Unlike large foundational models from major tech companies, these custom AI models are trained by the organization itself on their applications or corporate data.

Security Risks of Custom AI Models

  1. Weak Data Governance Policies - If data governance policies are inadequate, sensitive information, such as customers' Personally Identifiable Information (PII), could be improperly accessed or shared during the training process. This can lead to data breaches, privacy compliance violations, and unethical AI usage. The growing recognition of AI-related risks has driven the development of more AI compliance frameworks.
  2. Excessive Access to Training Data and AI Models - Granting unrestricted access to training datasets and machine learning (ML)/AI models increases the risk of data leaks and misuse. Without proper access controls, sensitive data used in training can be exposed to unauthorized individuals, leading to compliance and security concerns.
  3. AI Agents Exposing Sensitive Data -  AI agents that do not have proper safeguards can inadvertently expose sensitive information to a broad audience within an organization. For example, an employee could retrieve confidential data such as the CEO’s salary or employment contracts if access controls are not properly enforced.
  4. Insecure Model Storage – Once a model is trained, it is typically stored in the same environment (e.g., in Amazon SageMaker, the training job stores the trained model in S3). If not properly secured, proprietary models could be exposed to unauthorized access, leading to risks such as model theft.
  5. Deployment Vulnerabilities – A lack of proper access controls can result in unauthorized use of AI models. Organizations need to assess who has access: Is the model public? Can external entities interact with or exploit it?

Shadow AI and Forgotten Assets – AI models or artifacts that are not actively monitored or properly decommissioned can become a security risk. These overlooked assets can serve as attack vectors if discovered by malicious actors.

Example Risk Scenario

A bank develops an AI-powered feature that predicts a customer’s likelihood of repaying a loan based on inputs like financial history, employment status, and other behavioral indicators. While this feature is designed to enhance decision-making and customer experience, it introduces significant risk if not properly governed.

During development and training, the model may be exposed to personally identifiable information (PII), such as names, addresses, social security numbers, or account details, which is not necessary for the model’s predictive purpose.

⚠️ Best practice: Models should be trained only on the minimum necessary data required for performance, excluding direct identifiers unless absolutely essential. This reduces both privacy risk and regulatory exposure.

If the training pipeline fails to properly separate or mask this PII, the model could unintentionally leak sensitive information. For example, when responding to an end-user query, the AI might reference or infer details from another individual’s record - disclosing sensitive customer data without authorization.

This kind of data leakage, caused by poor data handling or weak governance during training, can lead to serious regulatory non-compliance, including violations of GDPR, CCPA, or other privacy frameworks.

Common Risk Mitigation Strategies and Their Limitations

Many organizations attempt to manage AI-related risks through employee training and awareness programs. Employees are taught best practices for handling sensitive data and using AI tools responsibly.
While valuable, this approach has clear limitations:

  • Training Alone Is Insufficient:
    Human error remains a major risk factor, even with proper training. Employees may unintentionally connect sensitive data sources to AI models or misuse AI-generated outputs.

  • Lack of Automated Oversight:
    Most organizations lack robust, automated systems to continuously monitor how AI models use data and to enforce real-time security policies. Manual review processes are often too slow and incomplete to catch complex data access risks in dynamic, cloud-based AI environments.
  • Policy Gaps and Visibility Challenges:
    Organizations often operate with multiple overlapping data layers and services. Without clear, enforceable policies, especially automated ones - certain data assets may remain unscanned or unprotected, creating blind spots and increasing risk.

Reducing AI Risks with Sentra’s Comprehensive Data Security Platform

Managing AI risks in the cloud requires more than employee training.
Organizations need to adopt robust data governance frameworks and data security platforms (like Sentra’s) that address the unique challenges of AI.

This includes:

  • Discovering AI Assets: Automatically identify AI agents, knowledge bases, datasets, and models across the environment.
  • Classifying Sensitive Data: Use automated classification and tagging to detect and label sensitive information accurately.
    Monitoring AI Data Access: Detect which AI agents and models are accessing sensitive data, or using it for training - in real time.
  • Enforcing Access Governance: Govern AI integrations with knowledge bases by role, data sensitivity, location, and usage to ensure only authorized users can access training data, models, and artifacts.
  • Automating Data Protection: Apply masking, encryption, access controls, and other protection methods automatically across data and AI artifacts used in training and inference processes.

By combining strong technical controls with ongoing employee training, organizations can significantly reduce the risks associated with AI services and ensure compliance with evolving data privacy regulations.

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Yair Cohen
Yair Cohen
January 28, 2025
5
Min Read
Data Security

Data Protection and Classification in Microsoft 365

Data Protection and Classification in Microsoft 365

Imagine the fallout of a single misstep—a phishing scam tricking an employee into sharing sensitive data. The breach doesn’t just compromise information; it shakes trust, tarnishes reputations, and invites compliance penalties. With data breaches on the rise, safeguarding your organization’s Microsoft 365 environment has never been more critical.

Data classification helps prevent such disasters. This article provides a clear roadmap for protecting and classifying Microsoft 365 data. It explores how data is saved and classified, discusses built-in tools for protection, and covers best practices for maintaining  Microsoft 365 data protection.

How Is Data Saved and Classified in Microsoft 365? 

Microsoft 365 stores data across tools and services. For example, emails are stored in Exchange Online, while documents and data for collaboration are found in Sharepoint and Teams, and documents or files for individual users are stored in OneDrive. This data is primarily unstructured—a format ideal for documents and images but challenging for identifying sensitive information.

All of this data is largely stored in an unstructured format typically used for documents and images. This format not only allows organizations to store large volumes of data efficiently; it also enables seamless collaboration across teams and departments. However, as unstructured data cannot be neatly categorized into tables or columns, it becomes cumbersome to discern what data is sensitive and where it is stored. 

To address this, Microsoft 365 offers a data classification dashboard that helps classify data of varying levels of sensitivity and data governed by different regulatory compliance frameworks. But how does Microsoft identify sensitive information with unstructured data? 

Microsoft employs advanced technologies such as RegEx scans, trainable classifiers, Bloom filters, and data classification graphs to identify and classify data as public, internal, or confidential. Once classified, data protection and governance policies are applied based on sensitivity and retention labels.

Data classification is vital for understanding, protecting, and governing data. With your ​​Microsoft 365 data classified appropriately, you can ensure seamless collaboration without risking data exposure.

Why data classification is important
Figure 1: Why data classification is important

Microsoft 365 Data Protection and Classification Tools

Microsoft 365 includes several key tools and frameworks for classifying and securing data. Here are a few. 

Microsoft Purview 

Microsoft Purview is a cornerstone of data classification and protection within Microsoft 365.

Key Features: 

  • Over 200+ prebuilt classifiers and the ability to create custom classifiers tailored to specific business needs.
  • Purview auto-classifies data across Microsoft 365 and other supported apps, such as Adobe Photoshop and Adobe PDF, while users work on them.
  • Sensitivity labels that apply encryption, watermarks, and access restrictions to secure sensitive data.
  • Double Key Encryption to ensure that sensitivity labels persist even when file formats change.
Sensitivity watermarks in M365
Figure 2: Sensitivity watermarks in Microsoft 365 (Source: Microsoft)
Figure 3: Sensitivity labels for information protection policies in Microsoft 365 (Source: Microsoft)

Purview autonomously applies sensitivity labels like "confidential" or "highly confidential" based on preconfigured policies, ensuring optimal access control. These labels persist even when files are shared or converted to other formats, such as from Word to PDF.

Additionally, Purview’s data loss prevention (DLP) policies prevent unauthorized sharing or deletion of sensitive data by flagging and reporting violations in real time. For example, if a sensitive file is shared externally, Purview can immediately block the transfer and alert your security team.

Sensitivity labeling for announcements in M365
Figure 4: Preventing data loss by using sensitivity labels (Source: Microsoft)

Microsoft Defender 

Microsoft Defender for Cloud Apps strengthens security by providing a cloud app discovery window to identify applications accessing data. Once identified, it classifies files within these applications based on sensitivity, applying appropriate protections as per preconfigured policies.

Microsoft Defender for Cloud - data sensitivity classification
Figure 5: Microsoft Defender data sensitivity classification (Source: Microsoft)

Key Features:

  • Data Sensitivity Classification: Defender identifies sensitive files and assigns protection based on sensitivity levels, ensuring compliance and reducing risk. For example, it labels files containing credit card numbers, personal identifiers, or confidential business information with sensitivity classifications like "Highly Confidential."
  • Threat Detection and Response: Defender detects known threats targeted at sensitive data in emails, collaboration tools (like SharePoint and Teams), URLs, file attachments, and OneDrive. If an admin account is compromised, Microsoft Defender immediately spots the threat, disables the account, and notifies your IT team to prevent significant damage.
  • Automation: Defender automates incident response, ensuring that malicious activities are flagged and remediated promptly.

Intune 

Microsoft Intune provides comprehensive device management and data protection, enabling organizations to enforce policies that safeguard sensitive information on both managed and unmanaged smartphones, computers, and other devices.

Key Features:

  • Customizable Compliance Policies: Intune allows organizations to enforce device compliance policies that align with internal and regulatory standards. For example, it can block non-compliant devices from accessing sensitive data until issues are resolved.
  • Data Access Control: Intune disallows employees from accessing corporate data on compromised devices or through insecure apps, such as those not using encryption for emails.
  • Endpoint Security Management: By integrating with Microsoft Defender, Intune provides endpoint protection and automated responses to detected threats, ensuring only secure devices can access your organization’s network.
Endpoint security overview
Figure 6: Intune device management portal (Source: Microsoft)

Intune supports organizations by enabling the creation and enforcement of device compliance policies tailored to both internal and regulatory standards. These policies detect non-compliant devices, issue alerts, and restrict access to sensitive data until compliance is restored. Conditional access ensures that only secure and compliant devices connect to your network.

Microsoft 365-managed apps like Outlook, Word, and Excel. These policies define which apps can access specific data, such as emails, and regulate permissible actions, including copying, pasting, forwarding, and taking screenshots. This layered security approach safeguards critical information while maintaining seamless app functionality.

Does Microsoft have a DLP Solution?

Microsoft 365’s data loss prevention (DLP) policies represent the implementation of the zero-trust framework. These policies aim to prevent oversharing, accidental deletion, and data leaks across Microsoft 365 services, including Exchange Online, SharePoint, Teams, and OneDrive, as well as Windows and macOS devices.

Retention policies, deployed via retention labels, help organizations manage the data lifecycle effectively.These labels ensure that data is retained only as long as necessary to meet compliance requirements, reducing the risks associated with prolonged data storage.

How DLP policies work
Figure 7: How DLP policies work (Source: Microsoft)

What is the Microsoft 365 Compliance Center?

The Microsoft 365 compliance center offers tools to manage policies and monitor data access, ensuring adherence to regulations. For example, DLP policies allow organizations to define specific automated responses when certain regulatory requirements—like GDPR or HIPAA—are violated.

Microsoft Purview Compliance Portal: This portal ensures sensitive data is classified, stored, retained, and used in adherence to relevant compliance regulations. Meanwhile, Microsoft 365’s MPIP ensures that only authorized users can access sensitive information, whether collaborating on Teams or sharing files in SharePoint. Together, these tools enable secure collaboration while keeping regulatory compliance at the forefront.

12 Best Practices for Microsoft 365 Data Protection and Classification

To achieve effective Microsoft 365 data protection and classification, organizations should follow these steps:

  1. Create precise labels, tags, and classification policies; don’t rely solely on prebuilt labels and policies, as definitions of sensitive data may vary by context.
  2. Automate labeling to minimize errors and quickly capture new datasets.
  3. Establish and enforce data use policies and guardrails automatically to reduce risks of data breaches, compliance failures, and insider threat risks. 
  4. Regularly review and update data classification and usage policies to reflect evolving threats, new data storage, and changing compliance laws.o policies must stay up to date to remain effective.
  5. Define context-appropriate DLP policies based on your business needs; factoring in remote work, ease of collaboration, regional compliance standards, etc.
  6. Apply encryption to safeguard data inside and outside your organization.
  7. Enforce role-based access controls (RBAC) and least privilege principles to ensure users only have access to data and can perform actions within the scope of their roles. This limits the risk of accidental data exposure, deletion, and cyberattacks.
  8. Create audit trails of user activity around data and maintain version histories to prevent and track data loss.
  9. Follow the 3-2-1 backup rule: keep three copies of your data, store two on different media, and one offsite.
  10. Leverage the full suite of Microsoft 365 tools to monitor sensitive data, detect real-time threats, and secure information effectively.
  11. Promptly resolve detected risks to mitigate attacks early.
  12. Ensure data protection and classification policies do not impede collaboration to prevent teams from creating shadow data, which puts your organization at risk of data breaches.

For example, consider #3. If a disgruntled employee starts transferring sensitive intellectual property to external devices in preparation for a ransomware attack, having the right data use policies in place will allow your organization to stop the threat before it escalates. 

Microsoft 365 Data Protection and Classification Limitations

Despite Microsoft 365’s array of tools, there are some key gaps. AI/ML-powered data security posture management (DSPM) and data detection and response (DDR) solutions fill these easily.

The top limitations of Microsoft 365 data protection and classification are the following:

  • Limitations Handling Large Volumes of Unstructured Data: Purview struggles to automatically classify and apply sensitivity labels to diverse and vast datasets, particularly in Azure services or non-Microsoft clouds. 
  • Contextless Data Classification: Without considering context, Microsoft Purview’s MPIP can lead to false positives (over-labeling non-sensitive data) or false negatives (missing sensitive data). 
  • Inconsistent Labeling Across Providers: Microsoft tools are limited to its ecosystem, making it difficult for enterprises using multi-cloud environments to enforce consistent organization-wide labeling.
  • Minimal Threat Response Capabilities: Microsoft Defender relies heavily on IT teams for remediation and lacks robust autonomous responses.
  • Sporadic Interruption of User Activity: Inaccurate DLP classifications can disrupt legitimate data transfers in collaboration channels, frustrating employees and increasing the risk of shadow IT workarounds.

Sentra Fills the Gap: Protection Measures to Address Microsoft 365 Data Risks

Today’s businesses must get ahead of data risks by instituting Microsoft 365 data protection and classification best practices such as least privilege access and encryption. Otherwise, they risk data exposure, damaging cyberattacks, and hefty compliance fines. However, implementing these best practices depends on accurate and context-sensitive data classification in Microsoft 365. 

Sentra’s Cloud-native Data Security Platform enables secure collaboration and file sharing across all Microsoft 365 services including SharePoint, OneDrive, Teams, OneNote, Office, Word, Excel, and more. Sentra provides data access governance, shadow data detection, and privacy audit automation for M365 data. It also evaluates risks and alerts for policy or regulatory violations.

Specifically, Sentra complements Purview in the following ways:

  1. Sentra Data Detection & Response (DDR): Continuously monitors for threats such as data exfiltration, weakening of data security posture, and other suspicious activities in real time. While Purview Insider Risk Management focuses on M365 applications, Sentra DDR extends these capabilities to Azure and non-Microsoft applications.
  2. Data Perimeter Protection: Sentra automatically detects and identifies an organization’s data perimeters across M365, Azure, and non-Microsoft clouds. It alerts “organizations when sensitive data leaves its boundaries, regardless of how it is copied or exported.
  3. Shadow Data Reduction: Using context-based analysis powered by Sentra’s DataTreks™, the platform identifies unnecessary shadow data, reducing the attack surface and improving data governance.
  4. Training Data Monitoring: Sentra monitors training datasets continuously, identifying privacy violations of sensitive PII or real-time threats like training data poisoning or suspicious access.
  5. Data Access Governance: Sentra adds to Purview’s data catalog by including metadata on users and applications with data access permissions, ensuring better governance.
  6. Automated Privacy Assessments: Sentra automates privacy evaluations aligned with frameworks like GDPR and CCPA, seamlessly integrating them into Purview’s data catalog.
  7. Rich Contextual Insights: Sentra delivers detailed data context to understand usage, sensitivity, movement, and unique data types. These insights enable precise risk evaluation, threat prioritization, and remediation, and they can be consumed via an API by DLP systems, SIEMs, and other tools.

By addressing these gaps, Sentra empowers organizations to enhance their Microsoft 365 data protection and classification strategies. Request a demo to experience Sentra’s innovative solutions firsthand.

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