How Much Does The Average Ransomware Attack Cost a Toronto MSP
Ransomware is the world’s most prominent malware threat alive today, given the numerous attacks reported in the recent past. According to a report by Emisoft, a cybersecurity company, ransomware incidents hiked by more than 80% in 2020. In Canada alone, the company estimates that businesses lost millions upon millions of dollars in ransoms.
This information is backed by the Global State of the Channel Ransomware Report by Datto Inc. Canada seems to be at the center of the rising cybersecurity attacks, and the impact on businesses is only increasing. In 2019, for example, Canada reported the highest average cost of downtime caused by ransomware incidents. The figure stood at $180,000. In 2020, the figure stood at $65,724, with more than 1,400 MSPs responding to the survey.
In 2019, the cost of downtime was valued at $141,000, up from $46,800 in 2018. In 2020, the average cost of ransom also went up by 37%, according to the report.
In another report issued before the attack on the Kayesa premises, a cyberattack affecting a single managed service provider could amount to economic losses of approximately $80 billion. Such an attack has a ripple effect in hundreds of small businesses that rely on the services of the MSP.
According to the report, the economic damage arising from the attack of an MSP could be more than that fashioned by Hurricane Sandy by 17%. One company with deficiencies in its cybersecurity systems could cause untold harm to company shareholders, the U.S. government, national infrastructure, and the public. This is according to Chris Nolan and Annie Fixler, authors of Intangic and Foundation for Defense and Democracies, respectively. Unfortunately, the general public seems to be blind to the extent of damage that arises from the risks of poorly managed technology, said the report.
What Does This Mean?
All these reports point to one thing: MSPs are vulnerable to being used as conduits for massive attacks on small businesses. Examples of such scenarios are the Cloud Hopper and Kayesa attacks, among others. In a hypothetical situation, an MSP can become a victim of a phishing scheme where hackers access its networks. They invade the customers to the MSPs, and the situation goes for months undetected. However, in Kayesa’s case, the attack was not via phishing, but previously unknown vulnerabilities in its VSA system.
Next, hackers could launch a more complex ransomware attack to impact multiple entities simultaneously. So bad can the damage be that it affects multiple industry sectors, critical infrastructure, and the entire country. According to an Intangics forecast, an attack impacting 600 entities, for example, could amount to economic losses of approximately $78 billion and thousands in job losses.
What is happening today is a pale reflection of what happened in the late 1990s in corporate accounting scandals, says the chief executive of Intangics, Ryan Dodd. In his opinion, taxpayers should not have to rely on data science and massive data sets to understand the extent of the complication that digital risk poses to their financial wellbeing.
Ransomware Is Not Going Anywhere
In 2019, 85% of small to medium enterprises reported ransomware as being the most significant cybersecurity threat. 66% of MSPs reported CtyptoLocker as the leading ransomware variant. Phishing emails, weak passwords, and a lack of cybersecurity awareness are the leading causes of successful ransomware incidents. Unfortunately, small businesses that don’t outsource their IT services face an even bigger risk of attack.
In Emisoft’s report, Canada experienced over 40,000 ransomware attacks in 2020. The minimum ransom was estimated to be worth $163,774,274 and the maximum $659,246.267. When you factor in the additional cost of downtime, the numbers escalate to a ransom cost estimate of $1,011,008,551 on the minimum, and $4,044,034,203 on the maximum. Unfortunately, out of the 21% of the business population affected in Canada, only 12% reported the incidents.
The attacks are on the increase, and they entail full-on data breaches that could see customer data posted online or sold. Most of the ransom demands are made in Bitcoin, since it is hard to trace yet easily accessible.
What Can and Should Be Done?
Unfortunately, MSPs are underutilizing one of the most crucial and effective controls against ransomware attacks- multi-factor authentication. Most of them report enabling 2FA on 61% of password managers and 60% of email clients, even though phishing emails are the most significant cause of ransomware breaches.
MSPs should be in the front line in setting the tone for the customers in preparation for and response to ransomware attacks. They should always aim at protecting themselves by improving their cyber hygiene to keep their clients safe. 2FA should become a universal requirement for any technology they use to service clients, as well as in their businesses.
While no single solution guarantees success against cyberattacks, business continuity and disaster recovery solutions play a role in helping businesses minimize the impact of ransomware attacks.
Legislators also have a mandate to pass a breach notification law mandating all companies to report cyberattacks on their systems and data. Increased transparency around vulnerabilities and breaches can raise awareness levels in the country. It should also be coupled with clear guidance for all businesses as far as cybersecurity is concerned.
The attempt to create federal law mandating the reporting of cyber incidents includes actionable recommendations like:
- The requirement for third-party cyber assessments
- Amendment of the Sarbanes-Oxley law to include cybersecurity reporting in auditing and financial regulations
- The provision of cyber hygiene guidance for all businesses
- The demand for breach notifications to list the economic and financial loss estimates after an incident.
Ransomware Protection For Businesses Across The GTA
These statistics should not scare you out of business. Instead, look for an MSP that constantly improves its technologies, strategies, and tools to protect your business effectively. At Tektonic, we are that MSP you need. We have invested in the right tools for cybersecurity and hold our vendors accountable for their level of cybersecurity readiness. This way, we can guarantee our clients the best cybersecurity solutions to protect their businesses and everyone’s livelihoods. Contact us today, and let us talk about becoming your reliable MSP partner.
Tektonic Managed Services is an IT Support and Computer Services company serving Toronto GTA. We provide services in and around Toronto, including York Region, Durham Region and Peel Region. Businesses like yours need technology support to run highly-effective organizations. Leverage pro-growth technology services for your company now!