How much do Professional Services stand to lose from poor network security?
With cyber attacks on a continued increase, every industry should be looking long and hard at how it is safeguarding itself – and with good reason. According to 2022 Keeper Security research:
- Professional services firms were experiencing cyber attacks up to three times a week
- The average statistics for cyber attacks sat at 161 incidents in 12 months
- A third of firms in the research experienced financial theft, with 42% of these seeing a loss of between £100,000 and £1m
- Around half stated that reputational damage had occurred due to network security breaches
- Over 75% of respondents in the research stated that the time taken to identify and respond to attacks has increased in the last 12 months
It goes without saying that those handling more sensitive information need to be at the forefront of this security restructuring, and professional services are no exception, and here are the reasons why.
Professional services – particularly law firms and accountancy firms – deal with highly confidential information, including client data, legal strategies, financial data, and case details. A security breach could compromise this sensitive information, leading to severe consequences such as legal action, reputational damage, huge shifts in company value/share price, and loss of client trust. Strict legal and ethical obligations are often in place to protect this client confidentiality. Breaches of client data can result in legal penalties, fines, and professional misconduct charges. Implementing robust network security measures is essential for compliance with these obligations.
Client Trust and Reputation:
Clients trust law firms to handle their cases with the utmost discretion and professionalism – including protecting their information with appropriate levels of security. A security breach can erode this trust, leading to reputational damage and potential loss of clients, as aforementioned in the Keeper research. Protecting the firm’s reputation is essential for long-term success, and in an age where professional services are delivered through digital means, clients expect the highest levels of data security.
Intellectual Property Protection:
Law firms in particular may handle intellectual property cases, dealing with patents, trademarks, and trade secrets. Unauthorised access to such information could have significant financial implications for both the firm and its clients in the case of intellectual property theft and unauthorised disclosures.
Like all European and UK businesses, professional services are subject to various data protection regulations, such as the General Data Protection Regulation (GDPR). Compliance with these regulations is crucial, and robust network security is a key component of meeting these compliance requirements. The amount of fines being issued increased sevenfold in 2022 compared to 2021, and GDPR breaches have seen professional services firms – such as Tuckers Solicitors LLP in 2022 – receive hefty fines, the upper limit being 20 million euros or 4% of turnover – whichever is greater. Network security is a vital part of ensuring data is kept secure, avoiding the financial implications of a slip-up.
As proven by the Keeper Security research, network breaches can have severe financial consequences for a law firm. Costs may include legal fees for handling the aftermath of a breach, potential fines for non-compliance, costs associated with reputational damage, and expenses related to restoring compromised systems.
Changing Cyber Threat Landscape:
The evolving nature of cyber threats poses a constant challenge for organisations, including law firms. In particular, the rise of cloud networking is adding an element of vulnerability that needs to be taken into account when planning network security infrastructure, in addition to the rise of AI-driven attacks. These potential vulnerabilities include:
- Data Breaches
- Shared Infrastructure
- Lack of Control
- Compliance Challenges
- Dependency on Service Providers
- Insider Threats
- Complexity and Visibility
The good news is that as network security becomes more and more holistic, agile and automated, professional services can avoid many of the risks though security solutions designed to future-proof business. Although the risks of digital business are greater, the solutions are simpler – if you know how to find the right fit for you!
Interested to know more? Read our article on “why SMBs need advanced security solutions”.