Devastating Examples of the Consequences of a Cyber-Attack

Reputational damage

As the above example of British Airways highlights, even after the direct financial costs of a cyber incident have been resolved, the ensuing reputational damage can continue to cost companies for years to come. 

Given the rising threat of identity theft, and the fact that phishing emails using personal details for authenticity are among the most common vectors for cyber-attacks, poor data protection around personal information can lead to a considerable loss of customer trust. 

This has become an even bigger problem for organisations in recent years, given how fast the news that a data breach has occurred can spread across social media.

A reputation that has taken years, or even decades to build, can be lost in seconds because of a security breach, making it far easier for competitors to tempt customers away.

Example

Returning to the 2017 Equifax data breach, alongside the $575 million in fines and settlements we covered earlier, the company also suffered significant damage to its reputation

Equifax’s Buzz score, a customer reputation metric, fell by a staggering 33 points in the first ten days after the breach was made public.⁸ 

Legal difficulties

Given the massive rise in cyber crime over the last decade, it’s unsurprising that we have seen the introduction of new legislation to cover data protection and responsibility. 

The EU is covered by the GDPR, which replaced the Data Protection Act in the UK on 1st January 2021.

In the US, data protection laws are less cohesive, with the Federal Trade Commission Act operating at the federal level, alongside a number of state-level laws.

What all of this legislation has in common is the ability to fine and even prosecute organisations, along with individual staff members, if they are found to have breached their compliance obligations.

Example

One high profile example of an organisation facing legal problems as a result of a cyber-attack is Adobe. Following a breach in 2013, encrypted customer credit card records and the login data of 38 million users was stolen.⁹ 

After the investigation into the breach was concluded in 2015, Adobe was fined $1.1 million (£794,000), and faced an undisclosed number of lawsuits because the company had violated the Customer Records Act. 

In addition to the direct legal difficulties, Adobe also suffered significant reputational damage and secondary financial losses.

Theft of intellectual property or confidential information

While less common than the consequences we’ve listed above, some cyber-attacks are launched in order to access very specific information. This might include intellectual property or other sensitive information. 

This, in turn, can lead to a loss of competitive advantage, as competitors or other bad actors can gain access to information related to strategies and innovation. The ultimate result of this can be a potential decrease in sales, and therefore lower profit margins. 

Pursuing intellectual property theft or copyright infringement claims can also result in significant legal costs for an organisation. Furthermore, the exposure of confidential information could also contribute towards reputational damage.

Example

In an example of the COVID-19 crisis increasing the volume of cyber crime, state-sponsored hackers from Russia, Iran, China, and North Korea have been accused of targeting pharmaceutical companies, vaccine manufacturers and research groups in an attempt to steal COVID-19 treatment and vaccine production research.¹⁰

Protect your organisation

Partnering with market-leading cyber security experts offers organisations of all scales the opportunity to shield themselves from the rising tide of cyber-attacks, and mitigate some of the major consequences associated with data breaches.

Six Degrees delivers mission-critical secure cloud services to major organisations across the UK, and offers a range of cyber security options, including industry-leading endpoint protection, managed detection and response services, end-to-end cyber security compliance guidance and advanced penetration testing.

Our experienced team provides full-coverage threat detection and protection in a scalable and holistic service that helps organisations build a robust defence against cyber threats and their consequences.

Contact us today to find out how Six Degrees can help shield your organisation from a devastating cyber-attack.

Further reading: For more on our cyber security processes at Six Degrees, take a look at our blog — The Six Degrees Approach to Cyber Security