Cash America 2014 Annual Report Download - page 40

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The Company’s business depends on the uninterrupted operation of the Company’s systems and business
functions.
The Company’s storefront operations depend on the efficiency and reliability of the Company’s point-of-
sale system. A shut-down of or inability to access the facilities in which the Company’s storefront point-of-sale
system and other technology infrastructure are based, such as a power outage, a failure of one or more of its
information technology, telecommunications or other systems, or sustained or repeated disruptions of such systems
could significantly impair the Company’s ability to perform such functions on a timely basis and could result in a
deterioration of the Company’s ability to perform efficient storefront lending and merchandise disposition activities,
provide customer service, perform collections activities, or perform other necessary business functions. Any such
interruption could have a Material Adverse Effect.
The Company’s services, operations and storefronts from which it provides products and services are also
vulnerable to damage or interruption from tornadoes, hurricanes, earthquakes, fires, floods, power losses,
telecommunications failures, terrorist attacks, acts of war, human errors and similar events. A significant natural
disaster, such as a tornado, which the Company’s headquarters has experienced in the past, hurricane, earthquake,
fire or flood, could have a material adverse impact on the Company’s ability to conduct business, including causing
damage to merchandise or collateral that it holds in any of its retail services locations and causing multiple pawn
lending locations to shut down or have limited operations, and the Company’s insurance coverage may be
insufficient to compensate for losses that may occur. Acts of terrorism, civil unrest or violence could cause
disruptions to the Company’s business or the economy as a whole. Any of these events could cause consumer
confidence to decrease, which could result in a decreased number of loans being made to customers or reduced
demand for pre-owned merchandise such as the merchandise sold in the Company’s pawnshops. Any of these
occurrences could have a Material Adverse Effect.
The Company is subject to cyber security risks and security breaches and may incur increasing costs in an effort
to minimize those risks and to respond to cyber incidents.
The Company’s business involves the storage and transmission of customers’ proprietary information, and
security breaches could expose the Company to a risk of loss or misuse of this information, litigation, and potential
liability. The Company’s network is entirely dependent on the secure operation of its systems as well as the
operation of the internet generally. While the Company has incurred no material cyber attacks to date, a number of
other companies have disclosed cyber attacks and security breaches, some of which have involved intentional
attacks. The Company may not have the resources or technical sophistication to anticipate or prevent rapidly
evolving types of cyber attacks. Attacks may be targeted at the Company, its customers, or both. If an actual or
perceived breach of security occurs, customer and/or supplier perception of the effectiveness of the Company’s
security measures could be harmed and could result in the loss of customers, suppliers or both. Actual or anticipated
attacks and risks may cause the Company to incur increasing costs, including costs to deploy additional personnel
and protection technologies, train employees, and engage third party experts and consultants.
A person who is able to circumvent the Company’s security measures could misappropriate the Company’s
or its customers’ proprietary information, cause interruption in the Company’s operations, damage its computers or
those of its customers, or otherwise damage its reputation and business. Any compromise of security could result in
a violation of applicable privacy and other laws, significant legal and financial exposure, damage to the Company’s
reputation, and a loss of confidence in the Company’s security measures, which could harm its business. In addition,
most of the Company’s customers provide personal information, including bank account information when applying
for consumer loans. The Company relies on secure transmissions protocols and access control technology licensed
from third parties to provide the security and authentication to effectively secure transmission of confidential
information, including customer bank account and other personal information. Advances in computer capabilities,
new discoveries in the field of cryptography or other developments may result in the technology used by the
Company to protect transaction data being breached or compromised. Data breaches can also occur as a result of
non-technical issues.
The Company’s servers are also vulnerable to computer viruses, physical or electronic break-ins, and
similar disruptions, including “denial-of-service” type attacks. The Company may need to expend significant