British companies stockpiling Bitcoins to pay off ransomware attackers

British companies stockpiling Bitcoins to pay off ransomware attackers

Soon after it emerged that North Korean hackers are increasing their efforts to get their hands on valuable Bitcoin, it now appears tthat British firms are more than eager to fulfill their lust for the digital currency.

British companies are hoarding Bitcoin in dozens to pay off hackers in the event of ransomware attacks to avoid the kind of reputational damage that the NHS suffered.

Back in November, shipping giant Clarksons PLC announced to the rest of the world that it wouldn’t pay a single penny to hackers after it suffered a ransomware attack. While the cyber security community applauded its move, the firm’s stand isn’t being followed by many British companies who’d rather pay ransom than spend on cyber security.

Many British companies are quietly hoarding Bitcoin or keeping tabs on the digital currency’s value to ensure they will be able to pay off hackers in the event of ransomware attacks. This approach seems more favourable compared to announcing a cyber incident and facing both reputational damage and backlash from cyber security experts at the same time.

According to former Ministry of Defence cyber chief Paul Taylor who spoke to The Sunday Telegraph, the fact that British companies are hoarding ransomware to pay off ransomware hackers is an open secret.

‘Companies are definitely stockpiling Bitcoin in order to be prepared to pay ransoms,’ he said, adding that companies are even ordering employees to ‘prepare digital wallets and monitor cryptocurrency prices to hedge against inflation should they need to buy, to keep a hack under wraps’.

The fact that British businesses are willing to pay ransom to hackers isn’t new. Back in June, a survey conducted by software firm Citrix revealed that British businesses were prepared to pay an average of £136,235.44 to regain access to critical and sensitive data lost to ransomware.

The survey also revealed that large UK businesses stockpiled an average of 23 bitcoins and that stockpiling digital currency rose from 33% in 2016 to 42% this year, despite cyber security experts crying hoarse about the ill-effects of paying ransom to hackers.

‘The decision to stockpile digital currency reflects a widespread attitude that paying a ransom may be necessary. Just one fifth (22%) of businesses are not prepared to pay anything when struck with a ransomware attack — a reduction from 25% last year,’ the firm noted.

While paying ransom to criminals and avoiding loss of critical data may seem quick and non-controversial to many companies compared to waging a public battle against hackers which they may not win, another reason behind this behaviour is the stigma attached to companies that have suffered successful cyber-attacks in the past.

‘Data breaches are almost inevitable. But they needn’t be a disaster. Indeed handled right they can even be a source of competitive strength,’ said Jeremy Swinfen-Green, Head of Consulting at TEISS.

‘A well-managed response, backed up by strong planning and a practised multi-functional incident response team (IRT), can reassure consumers affected by the breach. A strong response can even persuade them that the breached organisation will be more secure in the future – quite possibly more secure than competitors,’he added.

According to Mark James, Security Specialist at ESET, paying ransom is probably the worst thing that a company can do when faced with a ransomware attack. ‘Paying the bad guys may have done no more than labelled them as “willing to pay” for possible targeted attacks, and of course, does not guarantee the safety or nondisclosure of the files’.

‘Coming clean in a timely manner and working with authorities to mitigate the damages is always the best course of action- data breaches sadly are a consequence of our digital existence and the means of which we deal with them can make a huge difference to public perception and limit the aftermath,’ he says.

Copyright Lyonsdown Limited 2021

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