Ethics Scenario #54: Wilson City Blood Bank

54. Jacqueline is the CEO of the Wilson City Blood Bank, a 501(c)(3) nonprofit tax-exempt organization. Two weeks ago, one of her staff members, Rick, admitted to her that he had inadvertently lost a flash drive at a sporting event that contained very sensitive data on each of the 3,243 blood donors who had contributed to the blood bank during the calendar year. Included in the lost data were birthdates, social security numbers, and addresses, including data on scores of individuals who were asked not to donate because of how they answered very sensitive questions about their sexual and medical history. So far, there have been no indications that the data has been found by anyone or accessed in any way. Jacqueline recognizes that it is quite possible that the data will never be found or accessed in any criminal way. Jacqueline is hesitant to inform all of her donors because of the embarrassment it would cause the Bank, and it might give donors pause for donating again if they find out that their data were compromised. And it would be expensive to inform everyone, and there might not be much anything donors could do about it. She decides to wait a month or two more before informing anyone, including her board of directors, and directs Rick not to tell a soul about his mistake or risk being summarily fired.

a. Is Jacqueline’s behavior ethical?

b. If Rick stays silent, is his behavior ethical?