Data Loss Spikes Under COVID-19 Lockdowns

Two new reports suggest a massive gap between how organizations have prepared their cybersecurity defenses and the reality of their efficacy.

Seth Rosenblatt, Contributing Writer

May 28, 2020

5 Min Read

COVID-19-era data breaches go beyond unemployment insurance fraud, medical research hacks, and other hot topics. And unfortunately for public organizations and private companies, the data loss — from theft or otherwise — is getting worse. 

That's according to several studies published this month, including the "Digital Guardian Data Trends Report," published today, which paints an increasingly dire picture for organizations juggling plummeting employee morale, an increasingly heterogenous mix of devices accessing their servers from home networks, and hard-to-monitor employee data security practices. The report aggregated anonymized data from 194 of Digital Guardian's customers between Jan. 1 through April 15. 

According to the report, covering financial services, manufacturing, healthcare, and other businesses, employees copied company data to USB drives 123% more than before the pandemic's onset, with 74% of that data marked as "classified." Data egress over email, USB, and cloud services leaped 80%, with more than 50% of that data marked as "classified." Accompanying the spike in data copying is a 62% increase in malicious activity on corporate networks and servers, with a 54% bump in incident-response investigations.

"In times of economic uncertainty, employees tend to protect what they believe is theirs, and attempt to take sensitive data prior to being possibly laid off. That is the type of behavior our research is indicating and in some cases has proven to be true," says Tim Bandos, vice president of cybersecurity at Digital Guardian and the report's author. "We don't see a lot of the data going to the Dark Web. We see employees that worked on projects and think the data belongs to them."  

Whether or not the data loss is intentional, the fact that it is occurring at a much higher rate than just four months ago suggests a massive gap between how organizations have prepared their cybersecurity defenses and the reality of their efficacy. There will be a high cost to bolstering those defenses as organizations struggle with employee morale and a lack insight into the devices on their employees' home networks, experts warn.

In another report published today — of 2,000 American and British employees, as well as 250 IT decision-makers — email security company Tessian found 35% of employees take company documents and data with them when they leave a job. Nearly half are less inclined to abide by safe data practices when working from home, despite 91% of IT leaders trusting them to do so.

Data loss also becomes harder to stop when employees work from home, according to 84% of the IT leaders surveyed. In addition, 54% of employees say they find workarounds when security policies prevent them from completing tasks.

Some studies, however, like Verizon's annual "Data Breach Investigations Report," published a few weeks ago, downplay the threat from organization insiders. Insider cyberespionage accounts for 30% of breaches included in its survey.

"There is a distinct rise in internal actors in the dataset these past few years, but that is more likely to be an artifact of increased reporting of internal errors rather than evidence of actual malice from internal actors," the report states.

However, Verizon's report also states that financial gain drives 86% of data breaches, up from 71% in 2019. Importantly, the report also notes that attacks against web applications have doubled from the previous year to 43%.

Sign of the Times 
Of the COVID-19-specific challenges, one of the hardest for organizations to deal with has been the rapidly changing security landscape, says Zach Lanier, managing principal research consultant at security consultancy and research company Atredis Partners.

"There are a lot of variables thrown into the mix very fast," he says. "There are now multiple devices and device origins connecting to the same network that employees are using to get their work done. It was a tough situation in the 'before' times, but in the COVID-era it's even tougher. Your cool network IDS that was watching the network in the building isn't going to do much now, even if the employee is using a VPN, if they're only using one thing on the internal network."

At the core of the coronavirus crisis looms the reality that most organizations did not prepare for a "black swan" scenario where all employees would be working from home for an extended period of time, says Richard Bird, the chief customer information officer at Ping Identity.

"The COVID-19 event has really brought the issue of authentication of employees, contractors, and customers to the fore. Account takeover and account fraud are booming right now," he says. "If you are taking steps to move quickly but not correctly as it relates to people's security and privacy, how long does it take you to return to the baseline of security you had four months ago? I think we're in dangerous territory here."

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About the Author(s)

Seth Rosenblatt

Contributing Writer

Seth is editor-in-chief and founder of The Parallax, an online cybersecurity and privacy news magazine. He has worked in online journalism since 1999, including eight years at CNET News, where he led coverage of security, privacy, and Google. Based in San Francisco, he also writes about connected technology and pop culture.

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