In a poll of 154 small businesses from Eclipse Internet, 62 per cent admit they are unaware of the new maximum fine of £500,000 for flouting laws safeguarding consumers’ privacy.

Clodagh Murphy, director at Eclipse Internet, says: ‘The maximum fine of £500,000 for the most serious breaches is a huge sum of money for any company but for an SME it could be devastating. The government has a responsibility to work with companies of all sizes and ensure data is treated with great care.’

The new law for breaches in the Data Protection Act will come in to force this April.

Information commissioner Christopher Graham says: ‘These penalties are designed to act as a deterrent and to promote compliance with the Data Protection Act. I remain committed to working with voluntary, public and private bodies to help them stick to the rules and comply with the Act. But I will not hesitate to use these tough new sanctions for the most serious cases where organisations disregard the law.’

For a guideline to the new penalties visit the Information Commissioner’s Office website.