In 2017, we saw how massive ransomware attacks resulted in billions of dollars in losses for companies worldwide. But these attacks don’t just cost money: they can also cause companies to fail. A printing company in Colorado has recently closed after struggling to recover from a ransomware infection. The Denver firm, Colorado Timberline, displayed a statement on its website explaining that the firm had been forced to close after being “plagued” by IT events:
“…unfortunately we were unable to overcome the most recent ransomware attack and as a result this unfortunate and difficult decision was made.”
The firm’s statement highlighted the stark reality of the lasting and catastrophic damage that cyber-attacks can cause. The case is far from isolated. We have heard news from a handful of other organisations suffering a similar fate, but according to one study cyber-attacks put an end to 60% of businesses within six months of the incident.
Ransomware is a particularly expensive and complex problem for businesses. Attacks tend to be highly targeted, starting with a phishing email. If just one member of staff clicks the enclosed link, the whole organisation is affected. The infected computer is locked down by the attackers and held to ransom for a fee that the organisation would consider paying.
The infection can spread across the network, and even if the ransom is paid there’s no guarantee that the attacker will relinquish control. It’s often difficult to find and charge the criminal behind the attack, particularly because they tend to take payment in difficult to trace cryptocurrency.
As far as customers are concerned, it’s the company’s responsibility to look after their data and keep cyber criminals out. Regulators take a similar stance and will question whether adequate prevention measures were taken. If not, they may take a dim view. If the organisation does business in the European Union, they could be fined under GDPR for failing to take steps to keep threat actors away from customers’ private information.
When a company suffers a cyber security breach, the reputational damage can prove to be the most expensive and long-lasting blow. Research has shown that, in industries such as finance, retail and health care, up to a third of customers will cease doing business with an organisation after it suffers a breach.
Further financial losses occur when breached businesses are forced to financially compensate customers, pay legal fees, and pick up additional penalties. It’s hardly surprising then that organisations often shed staff after suffering data breaches. In a recent survey, 31% of SMBs and enterprises that suffered breaches cut back on staff within the first 12 months.
Not only do these decisions seem financially motivated, but they could also be an attempt to salvage the company’s reputation. A survey by Kaspersky Lab revealed that the first employees to go tend to be senior IT staff, followed by senior executives. 15% of SMBs and 24% of large enterprises shed their top executives in the wake of a data breach in attempts to install fresh leadership and establish renewed trust in the organisation.
While there’s no happy ending for Colorado Timberline, there is a moral to the story. Every organisation is at risk from cyber-attacks, and should be doing all they can to prevent them. Beyond effective anti-malware and firewall protection, the IT department needs clear visibility over all of their environments to assess where weak points exist.
Any member of staff could be the one to open a phishing email and let ransomware in, so they should all be educated on what to look out for and how to deal with attacks when they become evident. Of course, prevention beats remediation. Using a next generation cyber security solution will help to arm your organisation against existing and emerging threats.
For more information on ransomware, how attacks are constructed and how you can protect yourself, take a look at our ransomware white paper here.