In the US, the Attorney at Law magazine calculated the cost of downtime to a firm running on billable hours. For a firm with 25 staff, each billing at US$200 per hour, if each one had one hour’s downtime per month, then that’s US$60,000 lost.

Another recent report found that among the small and medium-sized businesses it surveyed, a quarter had experienced data loss due to a cyber breach. Sixty-nine per cent were offline for a limited time but, significantly, 37 per cent experienced financial loss, 25 per cent filed for bankruptcy and a further 10 per cent went out of business completely.

Making sure your systems are resilient is a serious investment for your organisation. Many SMBs rely on a computer-savvy person to run their IT, but that’s not enough. Small and medium-sized law firms need to use a managed service provider (MSP) to run their systems and ensure they can recover in the event of a cyber attack.

Ransomware is the biggest cyber threat law firms face

According to Datto’s recent report on ransomware, of the businesses surveyed, 69 per cent of ANZ MSPs report organisations having suffered a ransomware attack in the past two years.

So, what’s ransomware? It’s malicious software, usually delivered by a dodgy link that someone clicks on – a technique called phishing – that then infects the corporate network and encrypts the data on that network.

The result is that employees can’t access key client data, or any data, and the business grinds to a halt. The only way to get the data back, assuming it’s stored locally, and the company doesn’t have a business continuity and disaster recovery (BCDR) strategy, is to pay the hacker a ransom, and have the data decrypted.

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But it doesn’t always work out that way. One in five SMEs is reported to pay ransomware on average. Yet sometimes even paying the ransom doesn’t get the data back, with just over a half of those paying organisations reporting they received their data back. The hacker disappears, and the business is stuck with a severe problem.

Datto’s report also found that in Australia and New Zealand, downtime costs are roughly 51 times greater than the ransom requested. The average cost of ransomware is around $4,200, while the average cost of downtime is $216,000. And for a law firm, that cost could be even higher.

Why do companies fall victim to ransomware?

The leading cause of ransomware is phishing emails. These are emails that contain malicious links or appear to come from a known source and ask the recipient to enter privileged information like passwords, bank account details and log-on information.

A further 31 per cent of MSPs report poor user practices among SMEs caused their ransomware infection, while 28 per cent said the infection was due to a lack of cyber-security training. Meanwhile weak passwords accounted for 25 per cent.

A weak password is one that’s easily guessed, or has been reused from another account, either a corporate account or a personal account and has then been compromised in some way.

Finding the solution

The most effective solution to ransomware is to have a business continuity and disaster recovery plan with a service provider. With a plan like this, a business that is infected with ransomware can “roll-back” its systems to a clean state and start again. This minimises downtime, and lets the firm get back on its feet in a matter of minutes or hours, not days.

An important part of a BCDR plan is employee training. Ongoing and mandatory training will help staff recognise phishing emails and social engineering attempts, providing a further layer of security to the company.

Reducing ransomware threats requires a multilayer approach. A single product won’t cut it, which is where a solid BCDR solution comes into play. Backups of client and corporate data must be continuous and maintained off-premises, which allows for a rapid recovery if you’re attacked. And finally, dedicated IT staff, provided by a service organisation, can make all the difference.

As I said, and you understand, time is money. Law firms need to protect their crown jewels – their data and business continuity – if they’re going to survive in an environment where cyber threats are rapidly evolving.

James Bergl is the regional vice-president for Australia and New Zealand at Datto.