Ransomware: Small Business’ Biggest Threat

Ransomware: Small Business’ Biggest Threat

The prominence of ransomware within the already crowded cyber threat landscape has been in the headlines for the past few years. But what you won’t see in the headlines is the fact that small businesses are the ones bearing the brunt of the onslaught.  Ransomware is a form of attack in which hackers encrypt or steal your data then demand a ransom before giving you back access. And, according to Coveware’s ransomware report for Q1 of 2021, 73% of all reported ransomware attacks this year targeted businesses with under 1,000 employees. Of course, there are plenty of large companies that have to deal with ransomware, but it’s high time we start looking for solutions to the very real threat that small businesses across the country are grappling with.

There are a number of reasons ransomware attackers focus their efforts on small businesses. For one, these attackers are opportunists. They’re not looking to crack the toughest systems, they’re looking for a quick buck. Since small businesses probably don’t have the sophisticated and expensive security tools in place that big corporations do, the bad guys see them as easy pickings.

Another big reason small businesses are targeted by ransomware is because the consequences of having their system’s shut down are far more costly for small businesses. According to Coveware, the average downtime following a ransomware attack is 23 days — up 10% from Q4 of 2020. Last year a small business in Kansas with only  8 computers was hit with ransomware and paid the hackers $150,000 for to regain control of their systems. Explaining why the company decided to pay the company’s CFO said, “If we don’t pay them, we don’t have a way out of this, and business just stops, so it’s quite a scary situation.” While cybersecurity experts tend to advice companies not to pay ransom, and new evidence shows 92% of companies never get their data back after paying, the stress, fear, and consequences of being down may be enough to give into the demands.

When it comes to ransomware and small businesses, it’s clear the stakes are high and only getting higher. It’s essential we start focusing our efforts on helping these businesses take reasonable and affordable steps that can help prevent attacks and protect their data.

To help, use the acronym R.A.N.S.O.M for 6 simple steps that can go a long way toward preventing and protecting your small business against ransomware:

Remote access protections and patching

Given the rise of remote work since the pandemic, hackers are increasingly using remote access to install malware. Having remote access protections in place is therefore essential for preventing an attack. Even simple steps like robust firewall settings and requiring the use of VPNs and adding Endpoint Detection and Response can go a long way to keeping attackers out.

In addition, hackers are constantly looking for vulnerabilities in the software we rely on to run our businesses. All those software updates may be annoying to deal with, but they often contain important security features that “patch up” known vulnerabilities. At the end of the day, if you’re using out of date software, you’re at an increased risk for attack.

Administrative privilege limits

Setting limits on administrative and access privileges is another important way to protect your data. Every employee should only have access to the systems and information they need to preform their work. Too many businesses give employees more access than they need. If a hacker gains access to one of your employee’s accounts and there aren’t access limits set, then the hackers can move freely through your systems, changing settings and accessing sensitive data

Networks Segmentation

It’s important to keep different elements of your network separate from each other so you can control how information flows from one to the others. Similar to privilege limitations, this will help ensure that anyone who breaks into your systems can’t then use that access to move around your networks.

Security awareness training

Phishing and social engineering attacks are common ways attackers gain access to your systems and install ransomware. Unfortunately, phishing attacks are not something you can fix with a piece of software. Instead, its essential employees are provided with the training they need to spot and report any phish they come across. Sometimes it only takes one wrong click for the bad guys to worm their way in.

Offline backups and periodic testing

This is a big one. If you suffer a ransomware attack, having a backup of your systems may enable you to get you back up and running without having to pay or start over from scratch. However, when making backups it’s important to takes a few steps to ensure you can rely on them. For one, backups need to be stored offline in order to prevent hackers from gaining access to them as well. Second, it’s necessary to periodically test your backups to ensure they are working currently. You don’t want to be in the position of needing your backup only to find the whole thing is corrupted!

Multi-Factor Authentication

Finally, requiring multi-factor authentication can go a long way to prevent an attack. If an employee’s login credentials are stolen, MFA adds an additional layer of protection that may prevent the bad guys from getting into your systems.

Baltimore School District Ransomware Came After Report Showed “Significant Risks”

Baltimore School District Ransomware Came After Report Showed “Significant Risks”

Last week, on the Tuesday before Thanksgiving, state auditors released a report detailing “significant risks” within the Baltimore Country School District’s computer network. The next day, the school district was hit with a ransomware attack that shut the school down until Wednesday of this week. Because of the increase in COVID-19 cases, the district had just shifted online. However, the ransomware attack put a stop to remote learning and gave over 115,000 students an extra week off school.

The state auditor’s report, released just the day before the attack, details the findings of an investigation into the security of the district’s computer systems that was conducted between May 2019 and February 2020. One of the major findings of the report showed that 26 publicly-accessible severs were located within the districts internal network, rather than segregated in external networks. This increases the risk of a user accessing the district’s internal systems via the public servers. In addition, the report that the district did not have adequate protections in place to secure personally identifiable information, there was no detection system in place to catch unwanted traffic, and students even had “unnecessary network-level access to administrative servers.”

The district has said it is too early to tell whether the attack was related to the vulnerabilities found in the auditor’s report. However, it is certainly possible the lack of network segmentation could have possibly made it easier for the ransomware to spread across systems and devices. The district has also not said whether any personally identifiable information was compromised in the attack.

Despite the district’s tight lips surrounding the specifics of the attack, they did ask all students and staff to perform a “confidence check” on school-issues devices, which potentially sheds light on some of the details. Specially, the district is asking students and staff to look for .ryk file extensions on their devices. This file extension likely points to an increasing common form of ransomware called Ryuk. Ryuk is a form of ransomware that encrypts data within the network. This may be a relief to school officials, given the recent trend in ransomware where attackers actually steal and leak sensitive data rather than just encrypt it within the network.. However, Ryuk is also infamous for its ability to quickly spread across devices connected to the network, including back-ups. This makes the state auditor’s findings potentially highly relevant to the scope and impact this attack has caused so far.

The Baltimore School District’s ransomware attack is unfortunately not entirely surprising. In the past few years, attackers have started targeting public agencies and schools. Because public entities often don’t have the budget or personnel for sophisticated cybersecurity defense and their services are essential for many people, attackers see these as juicy targets for ransomware attacks.

This doesn’t mean, however, that public agencies need to be sitting ducks. If the district had intrusion detection system in place, for instance, it’s possible they could’ve caught attack before it even started. The fact that students also had access to certain administrative servers is also a big problem, and could be easily fixed with simple access control measures put in place. Lastly, while you can’t always prevent these attacks from happening, segregating networks and devices can go a long way towards limiting the impact of ransomware. This will not only help prevent the spread of the attack throughout the network, but, if back-ups are routinely tested and stored offline, could allow organization’s to easily restore their systems to a pre-attack state without paying a ransom. The attack against the Baltimore School district is a stark example of the importance of creating not just a cyber-secure, but also a cyber-resilient online environment.

Ransomware Cyber Insurance Claim Amounts Skyrocket

Ransomware Cyber Insurance Claim Amounts Skyrocket

According to a new report by Coalition, one of the nation’s cyber insurance providers, ransomware attacks make up 41% of all cyber insurance claims in the first half of 2020. Unfortunately, that’s the good news. That number is actually down by 18% since 2019. The bad news? While the frequency of ransomware attacks are down, the severity of attacks has risen dramatically.

In particular, cyber criminals are starting to demand more and more money from their victims. According to Coalition, ransomware claims are in general 2.5x higher than other cyber insurance claims across all industries. And demands continue to increase in dramatic fashion. Coalition’s report states that the average ransom demand increased 100% since 2019 and has already risen an additional 47% between Q1 and Q2 of this year.

chart showing increase in ransomware demands

Source: Coalition

What’s more, not only have ransomware demands increased, but the attacks themselves are becoming more and more sophisticated. While traditional ransomware attackers encrypt data within the target’s network, now they are actually stealing the data and threatening to leak the information if a payment isn’t made, as happened to the cloud services firm Blackbaud this summer. This tactic may in part account for the of the increases in demands, as organization’s may be more motivated to pay in order to keep the incident private. However, there is no guarantee that paying will stop the attackers from leaking the data anyway.

While the Coalition report shows that more and more businesses are turning to cyber insurance to help with ransomware attacks, relying on insurance should not be your  solution. Sure, insurance may help pay the cost of the ransom, but if attacks know insurance companies will pay up, they may start to feel confident asking for larger and larger amounts of money. The FBI also discourages businesses from paying demands.

Instead, the best response is prevention. Even simple solutions like multi-factor authentication and good password management can help dramatically. In addition, the report found that 60% of claims are for attacks that originated as a phishing or other social engineering scams. Investing in effective cyber awareness training can help prevent attacks from occurring in the first place. Like with most things related to cybersecurity, it’s always better to take action now rather than wait for the worst to happen.

Blackbaud Facing Lawsuit After Ransomware Attack

Blackbaud Facing Lawsuit After Ransomware Attack

In July, we wrote about a ransomware attack suffered by the cloud computing provider Blackbaud that led to the potential exposure of  personal information entrusted to Blackbaud by hundreds of non-profits, health care organizations, and educational institutions. At the time the ransomware attack was announced, security experts questioned Blackbaud’s response to the breach. Now, the Blackbaud ransomware attack isn’t just raising eyebrows, with the company facing a class action lawsuit for their handling of the attack.

Blackbaud was initially attacked on February 7th of this year. However, according to the company, they did not discover the issue until mid-May. While the time it took the company to detect the intrusion was long, it is increasingly common for threats to go undetected for long periods of time. What really gave security experts pause is how Blackbaud responded to the incident after detecting it.

The company was able to block the hacker’s access to their networks, but attempts to regain control continued until June 3rd. The problem, however, was that the hackers had already stolen data sets from Blackbaud and demanded a bitcoin payment before destroying the information. Blackbaud remained in communication with the the attackers until at least June 18th, when the company payed the ransom. Of course, many experts questioned Blackbaud’s decision to pay given that there is no way to guarantee the attackers kept their word. And, to make matters worse, the company did not public announce the incident to the hundreds of non-profits that use their service until July 16th  — nearly two months after initially discovering the incident.

Each aspect of Blackbaud’s response to the ransomware attack is now a part of a class action lawsuit filed against the company by a U.S. resident on August 12th. The main argument of the lawsuit claims that Blackbaud did not have sufficient safeguards in place to protect the private information that the company “managed, maintained, and secured,” and that Blackbaud should cover the costs of credit and identity theft monitoring for those affected. The lawsuit also alleges that Blackbaud failed to provide “timely and adequate notice” of the incident. Finally, regarding Blackbaud’s payment of the ransomware demand, the lawsuit argues that the company “cannot reasonably rely on the word of data thieves or ‘certificate of destruction’ issued by those same thieves, that the copied subset of any Private Information was destroyed.”

Despite the agreement among privacy experts that Blackbaud’s response to the attack was anything but perfect, lawsuits pertaining to  data breaches have historically had a low success rate in the U.S.. According to an attorney involved in the case, showing harm requires proving a financial loss rather than relying on the more abstract harm caused by a breach of privacy: “The fact that we don’t assign a dollar value to privacy [means] we don’t value privacy.”

Whatever the result of the lawsuit, questions still persist on whether Blackbaud’s response violates the E.U.’s General Data Protection Regulation. The GDPR requires organizations to submit notification of a breach within 72 of discovery. Because many of Blackbaud’s clients are UK-based and the company took months to notify those affected, it is possible Blackbaud could recevie hefty fines for their response to the attack. A spokesperson for the UK’s Information Commissioner’s Office told the BBC that the office is making enquiries into the incident.

As for the non-profits, healthcare organizations, and educational institutes that were affected by the breach? They have had to scramble to submit notifications to their donors and stakeholders that their data may have been compromised. Non-profits in particular rely on their reputations to keep donations coming in. While these organizations were not directly responsible  for the breach, this incident highlights the need to carefully review third-party vendors’ security policy and to create a written security agreement with all vendors before using those services.

BEC and Ransomware: Following the Money

BEC and Ransomware: Following the Money

According to this year’s Cost of a Data Breach Report, the majority of malicious cyber attacks are financially motivated. So, when prioritizing risk, it makes sense to focus on cyber threats that have direct financial implications, such as ransomware and business email compromise (BEC) schemes.

Given the recent rise in ransomware attacks and the targeting of public agencies, it’s pretty likely you’ve seen some news about ransomware within the past year. And while it is certainly important to protect against the possibility of ransomware, that doesn’t mean less-publicized cyber attacks like BEC should be taken any less seriously.

In general, business email compromise involves scammers sending employees an email that looks as if it is coming from a familiar source requesting some sort of payment. Usually, scammers will impersonate frequently used vendors or even CEOs. And these scams can be costly. Last year Nikkei, a Japanese media company, suffered a loss of $29 million when a scammer impersonated a company executive.

In fact, BEC scams have repeated topped the FBI’s annual Internet Crime Report as the costliest form of cyber crime. And, when you compare the costs of BEC and ransomware attacks, it becomes pretty clear which one poses the greater risk.

Cost Comparison (in millions)

YearBECRansomware
20152631.6
20163602.4
20176752.3
201813003.6
201917009
Source: FBI Internet Crime Report (2015-2019)

While FBI’s report shows a sharp increase in ransomware losses in recent years, BEC scams continue to outpace ransomware by a staggering margin. If you were responsible for prioritizing risk activities in your organization, where would you focus? When you follow the money, the answer is pretty obvious. The good news, however, is that a lot of the procedures, guidelines, and training that can be done to prevent BEC can also help ransomware, such as anti-malware software and email authentication. It can be easy to base your cybersecurity processes off of what you see in the headlines, but that won’t always give you an accurate view of your risk profile. It’s essential to conduct regular risk assessments to gain a clear understanding of the biggest threats your organization faces.