Digital extortionists blackmail British corporate executive suites through ransomware attacks
Rewritten Article:
In the midst of these headlines, it's not just retail giants like Marks & Spencer, the Co-op, or Harrods that are at risk - any business, regardless of size or industry, can become a target for cyber criminals. Such hacking attempts can occur at any time, anywhere in the world, leaving business leaders and investors living in constant concern.
According to insurance broker Howden, the risk is, well, universal. With cyber attacks costing UK companies £44 billion over the past five years and affecting approximately half of all firms, it's no wonder they're losing sleep over it.
In some extreme cases, former hostage negotiators, skilled at dealing with blackmailers and terrorists, have been called in to handle these situations. Others have opted to pay the ransom demands outlined in their insurance policies, sparking concern that the existence of such coverage might only embolden the criminal gangs at play.
Typically, the hackers find their way in through gaps in a company's cyber defenses, often infiltrating a supplier's IT systems. The recent attacks on M&S, Co-op, and Harrods have been linked to hacking groups such as DragonForce, with some experts pointing towards the teenage blackmailers known as Scattered Spider.
For M&S, which has been grappling with this attack for over three weeks, it's a classic 'ransomware' attack - the hackers have infiltrated, frozen the data systems, and only promise to release them once a ransom is paid.
The damages inflicted on M&S are evident. Store shelves have been cleared, online orders have been impossible to place through their website and app, warehouse workers have been sent home, and the popular click-and-collect service remains suspended. Even recruitment has been paused due to worries that this cyber crisis might last months.
The retailer's move to a hybrid work model could be a contributing factor in this attack, as their latest annual report notes that the sophistication and frequency of cyber-attacks continue to increase. It also highlights that their reliance on third parties, especially those hosting data, exposes them to risks from potential vulnerabilities in the cybersecurity and data controls of those parties.
Similarly, the Co-op confirmed this week that hackers had breached a significant number of customer records, including names, addresses, but not passwords or financial information.
Meanwhile, other industries haven't been spared either. In 2021, seen as a relatively 'soft' target, smaller firms have been hit by ransomware attacks. Some high-profile victims include the NHS, the Guardian newspaper, the British Library, and Morrisons in 2020.
The consequences can be grim. Last year, foreign exchange firm Travelex went under six months after a ransomware attack. Industry leaders such as George Weston, chairman of Primark owner Associated British Foods, and CS Venkatakrishnan, Barclays CEO, have alluded to the constant battle against cyber crime, with Venkatakrishnan going so far as to call it a top concern for any business leader.
In the case of M&S, while the goal is always to stay one step ahead, the terrifying truth is that the world of cyber crime is always evolving, making it an endless game of catch-up. As the CEO of Lloyds put it, they invest hundreds of millions of pounds into cyber security, acknowledging that this threat isn't going away anytime soon.
The latest Government report supported this, warning that for the organized crime gangs behind the global fraud industry, ransomware is an increasingly lucrative part of their operations. Scammers have launched thousands of ransomware attacks between 2024 and 2025, and an estimated 76% of UK businesses experienced a cyber security incident in the past year.
While many were lower-level phishing attacks, smaller firms can still be easy targets. A key concern is whether companies have enough board directors with the right level of expertise in this field. Most chairmen and CEOs are older than these teenage hackers, who have grown up online. If anything, the boardrooms might seem weaker in this respect.
To combat these attacks, it's crucial to keep software and systems up-to-date, implement multi-factor authentication, conduct regular risk assessments, backup data, use antivirus and anti-ransomware software, and train employees on cybersecurity best practices. More advanced measures include integrating AI-driven threat detection, deploying a zero trust architecture, implementing secure-by-design principles, focusing on container security and automated patch management, and conducting regular vulnerability scanning and penetration testing.
For the healthcare industry, HIPAA compliance is a must. Incident response planning and developing detailed contingency strategies are also essential for ensuring rapid recovery in case of an attack.
Investors should also be aware of the potential impact of cyber-attacks on share prices, as seen with M&S. In light of this situation, experts advise firms to ensure their IT systems have watertight security at all times while hackers only have to be lucky once. Cybersecurity is a complex battle with no easy solutions, but a proactive and comprehensive approach to defense can help minimize the risks.
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- The current state of cybersecurity necessitates that businesses, regardless of size or industry, invest in robust cybersecurity measures to protect against cybercriminals.
- Insurance policies can be valuable in handling ransom demands, but there's a concern that such coverage might embolden criminal groups.
- Cyber attacks are costing UK companies billions, affecting about half of all firms, and the existing slave market of cybercrime shows no signs of slowing down.
- Hackers often infiltrate companies through gaps in cyberdefenses, frequently exploiting weaknesses in a supplier's IT systems.
- The finance sector isn't immune to cyber threats, with foreign exchange firm Travelex folding six months after a ransomware attack in 2021.
- In the case of M&S, a hybrid work model could have contributed to the attack, as increasing cyber-attacks have been noted in the latest annual report.
- Investors should be wary of the impact of cyber-attacks on stock prices, as seen with M&S, and encouraged to ensure their investments prioritize robust cybersecurity defenses.
