As businesses store most of their data online, their chances of facing cyber attacks are rising every day. Dealing with cyber criminals can be costly, making their services costly for their customers.
According to the latest survey, companies worldwide lost around $4.45 billion in 2023 due to cyber-attacks and breaches. Cybercriminals mainly target companies having huge online presence.
According to the best Criminal Offence Lawyer, companies in sectors like energy, financial services, manufacturing, technology, and pharmaceutical sectors had suffered significant losses.
In this article, we will have a look at the most crucial ways our business can be hampered by cybercrime.
Key Takeaways
- Rarely do companies report having to pay a ransom to regain control of essential IT systems
- Operational disruption due to cyberattacks has made businesses suffer higher losses, leading to altered business practices.
- Reputational damages have caused the biggest losses for many companies. They have lost control of their customers’ data, leading them to pay millions in various lawsuits.
Effects of Cybercrimes on Businesses
- Increased Costs:
Companies that want to safeguard themselves from hackers and other cybercriminals have to pull out their wallets. They have to spend on things such as:
- Cybersecurity technology and expertise
- Notifying affected parties about the breach.
- Insurance Premiums.
- Public relations support.
Companies can suffer a significant financial burden due to ransomware, which can prevent workers from gaining access to IT systems until the hacker is paid by the company.
According to a survey, 6% of companies had to pay ransom in 2019, accounting for $381 million in losses.
Additionally, businesses hire lawyers and other experts to comply with cybersecurity regulations. If they become victims of cyber fraud, they will pay more for attorney fees and damages due to civil cases against them.
- Operational Disruption:
A major disruption of operations can lead to indirect costs for many companies. They can cause problems like loss of revenue and much more.
Cybercriminals can resort to any number of ways to curtail a company’s regular activities, either by erasing high-value information with malware or installing malicious codes on a server to block access to your websites.
So-called “hacktivists” usually disrupt businesses as their favourite tools against any corporate organization. They are known to hack into the computers of various government organizations and multinational corporations to “call out any perceived wrong or increase transparency.”
- Alteration in Business Practices:
The impact of cyber crimes on businesses is not limited to financial losses. Companies have to bring significant changes in their practices and restructure their data collection policies to ensure zero vulnerability of their information.
Some companies have closed their online stores after recognizing their inability to adequately safeguard their businesses against cyberattacks. Customers will only prefer companies that are vocal and updated with the protections they offer.
- Reputational Damage:
Companies that suffer from larger cyberattacks find their brand equity largely tarnished. It leads to customers and suppliers feeling less sure about sharing their sensitive info with a company whose IT infrastucture was breached upon once.
Target, a retail giant suffered a blow to their reputation after a data breach involving the credit card information of 40 million customers in 2013 made them pay $18.5 million in a lawsuit.
Furthermore, companies will experience a short-term dip in the market, leading to performance that are lower than expected.
- Revenue Loss:
Loss of revenue is one of the worst outcomes of cybercrimes. It happens because customers become cautious and move elsewhere to protect themselves from online fraud. Companies can also lose a lot of money to hackers trying to extort their victims.
The biggest example is Sony Pictures, which came under an online attack in 2014 while preparing to release “The Interview,” which had Seth Rogen and James Franco in lead roles. Hackers got all the sensitive information including performance evaluation and emails of its staff.
Sony Pictures had to pull the movie out of many theatres and release it online, suffering a loss of $30 million. Since this movie depicted a controversial figure, his countrymen were believed to be responsible for this attack.
- Stolen Intellectual Property:
A company’s product designs, technologies, and market strategies are considered its most valuable assets. Most of these assets are stored in the cloud, which is vulnerable to cyber leaks.
Nearly 30% of US companies have claimed their intellectual property stored in the cloud has been stolen by Chinese individuals in the past ten years.
With time, they are finding new technologies that ensure the utmost safety of their assets. Various regulations are also introduced to protect companies from such issues.
Tips To Prevent Cybercrimes in Your Organizations
Companies are introducing measures that will protect them from various cybercrimes and their aftermath. These include:
- Putting a cybersecurity system on board:
This will keep cybersecurity as a strategic front and enhance its knowledge among the employees. It will reduce the risk of any cyberattack and keep your company away from any potential incident.
- Creating a Long-Term Cybersecurity Strategy:
Companies need to create a long-term cybersecurity strategy that can be helpful in mitigating potential risks. The more systematic it becomes, the better.
Conclusion
Cybersecurity is not just a corporate responsibility., it is much more than that. Companies have to step up their online security to ensure proper protection of customer data.
As we have seen various examples where various companies have suffered huge setbacks due to these cyber attacks, improving and implementing cybersecurity measures can prevent unwanted outcomes.
Cyber crimes are still on the rise. With modern technologies, hackers will find their way into the systems of various corporate organizations, causing significant losses to them.
Even government organizations are not safe. They are also implementing steps that will protect data of millions of citizens. Thus, it will definitely lower the chances of cyber attacks on civilians.
Additionally, common people can also prevent leaks of their personal data by enhancing their cybersecurity systems in their devices. A large population is also vulnerable to at
