Law firms are preemptively opening Bitcoin wallets to pay ransoms

Thomson
Reuters

• Law firms are preemptively opening Bitcoin wallets in
  order to pay ransoms to hackers when client data is
  stolen.
• Opening wallets is just one contingency plan firms can
  make, and should be a “last resort.”
• The news comes as offshore firm Appleby admitted client
  data had been stolen in a cyber breach, and is now at risk of
  being leaked.

---

LONDON – Law firms are preemptively opening Bitcoin wallets to
pay ransoms in case their data is hacked, according to a
cyber-security expert.

Opening a Bitcoin wallet is just one contingency plan firms can
make to prepare for cyber breaches in which client data is
stolen, according to John Sweeney, president of IT and cyber
security advisors LogicForce. This can be a useful “last resort”
when the data is not backed up and cannot be restored unless a
ransom is paid.

“The firms doing this are smarter,” said Sweeney, and are looking
to take “conscientious” proactive, rather than reactive, steps.
Sweeney stressed he did not generally advocate paying ransoms,
but said it “makes sense” for firms to have a Bitcoin wallet to
hand. “I certainly don’t see it as a bad move,” he said.

Data breaches at law firms are a growing concern:
confidential information, often sent in unencrypted emails, risks
being stolen and ransomed back to firms, used for fraud or sold
to third parties to be used in crimes such as insider trading.

On Tuesday, offshore law firm Appleby admitted client data had
been stolen in a breach last year. The firm’s super-rich clients
are now bracing themselves for the
possible exposure of their financial secrets.

Sweeney said firms must do more to enhance cyber security. He
said the balance of risk and reward is “totally in the cyber
criminals’ favour,” since the likelihood of a hacker being caught
is slim, and the likelihood of being prosecuted is
“infinitesimally smaller.”

“We are predicting there are going to be more sophisticated
attempts to intrude at firms that work with highly visible
clients whose IP or business information is extremely valuable,”
he said.

However, paying a ransom is no guarantee of anything: according
to Sweeney, it has taken firms two months and three ransom
payments to recover data from hackers.

LogicForce is planning to open its own Bitcoin account
within the next few weeks, in order to assist client “disaster
recovery.”

“This is new,” said Sweeney — but in the long-run, “it could
become a normal course of business.” 

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