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Risk & Analytics|Financial, Executive and Professional Risks (FINEX)
COVID 19 Coronavirus|Legal PI Risk Management

By Dr. Joanne Cracknell | August 11, 2020

During the coronavirus pandemic (COVID-19) the main focus for businesses has predominantly been crisis management and operational resilience.

Many organisations will be revising or rewriting their business models and considering how they will operate as lockdown restrictions start to ease and businesses prepare to return to the workplace.

COVID-19 has taken the world by surprise. The pandemic has been fast moving with unseen challenges which has destabilised global economies and changed the way the world operates. To respond to the restrictions imposed on society, individuals and businesses have become more technologically connected turning to remote working, video conferencing and on-line purchases.

It is uncertain whether COVID-19 will ever go away1 and it is anticipated that social distancing and interacting and working remotely will become the norm. Attitudes towards cash have also changed. There have been concerns around handling potentially COVID-19 infected cash which has resulted in an increase in the use of contactless digital payments with the contactless limit for in-store spending increasing from £30 to £45. The pandemic could perhaps be the catalyst in moving towards a cashless society and with the nervousness around cryptocurrency easing is it now the time for cryptocurrency to shine as interest in blockchain and cryptocurrency increases?2

It has been suggested that COVID-19 has increased the appetite for cryptocurrency, in particular Bitcoin (which dominates approximately 60%3 of the crypto markets) which has reached highs not seen since the cryptocurrency boom and bust during 2017 and early 20184.

Although conducted prior to the COVID-19 crisis the FCA recently published research on cryptoassets5. The findings suggest that 3.86% of the general population own cryptocurrencies. The research also found that awareness of cryptocurrencies has increased with 27% of consumers never having heard of cryptocurrencies, compared with 58% in the 2019 survey, and Bitcoin was the most recognised cryptocurrency.

At the recent Willis Towers Watson Cryptocurrency roundtable event held in June 2020, we explored whether the pandemic has increased the appetite for cryptocurrency. The general consensus was whilst there was a heightened awareness in cryptocurrency, it was still too early to tell whether investment in or the use of cryptocurrency had increased during the last three months. What did become apparent from the roundtable was that the increased reliance on remote working had identified weaknesses in cyber security awareness and people were not as technically savvy as they thought. Furthermore, it was identified that the level of cyber scams has increased and criminals are requesting cryptocurrency, in particular Bitcoin, as methods of payment for ransomware attacks or payment for fake goods on fraudulent websites.

This view supports the numerous warnings issued by law enforcement agencies about criminals exploiting vulnerabilities caused by the COVID-19 crisis. In April Interpol issued warnings about the threat of ransomware attacks on hospitals and organisations on the front line in combating COVID-196.

As a result of the changes in working practices many organisations are moving away from a physical working environment to a digital one or at the very least operating a hybrid structure. Transitioning from physical to digital can leave organisations vulnerable to cyber attacks and data breaches and it is essential that this is effectively monitored and managed and the appropriate impact assessments are carried out.

In April the National Cyber Security Centre (NCSC) launched the Suspicious Email Reporting Service7, as part of the Government’s Cyber Aware campaign which allows members of the public to forward suspect emails which may link to fraudulent websites. The service was receiving on average 16,500 emails per day with total figures reaching one million which has resulted in thousands of fraudulent websites being blocked.

Phishing scams continue to increase with emails purporting to come from charities seeking donations, or impersonating governmental bodies and include references to TV Licensing, HMRC, Gov.uk and the DVLA which add a veneer of legitimacy to the emails. In addition, phishing scams containing information about how to purchase treatments for the virus, testing kits and personal protective equipment have escalated. These invite people to click on attachments or links which in turn leads them to malicious websites potentially allowing cybercriminals access to sensitive data, financial information or requesting online payments for fake items often requesting payments to be in Bitcoin.

There has been an influx of cryptocurrency investment scams8, where scammers are impersonating crypto traders or crypto exchanges promising investors high returns in exchange for buying cryptocurrency such as Bitcoin. Bitcoin is seemingly the cryptocurrency of choice for cybercriminals because of its dominance on the crypto market. It is the cryptocurrency most people are familiar with and therefore on the face of it the schemes appear to be genuine.

It has been just over four months since we found ourselves in lockdown and as restrictions are gradually being eased it is crucial that cyber security awareness is heightened and cyber security refresher training is provided to all staff, especially as businesses are returning to the workplace and/or are operating a hybrid structure. If passwords have not been changed for some time or at least since lockdown, then perhaps now is the time to change them to strong, secure passwords to reduce the chances of them being easily hacked. It is crucial that all software updates and security patches are installed on all systems and mobile devices to ensure that any vulnerabilities in your IT systems are not being exploited by hackers.

The message of vigilance remains loud and clear. If anyone receives any emails that do not look right remember not to open them or to download software/applications from untrusted sources. Do not click on links or open attachments in emails which you were not expecting to receive or come from an unknown sender. Equally as important is the requirement to report any suspicious looking emails in accordance with your internal policies and procedures in order to mitigate any cyber security breaches. It is recommended that you report suspicious emails which may link to fraudulent websites to the NCSC as doing so will help the police fight cybercrime by identifying patterns and trends in cyber attacks and take down malicious websites.

Footnotes

1 BBC. (2020). Coronavirus may never go away, World Health Organization warns. Retrieved from https://www.bbc.co.uk/news/world-52643682

2 Cointelegraph. (2020.) Interest in Bitcoin Spikes Worldwide During COVID-19 Crisis. Retrieved from https://cointelegraph.com/news/interest-in-bitcoin-spikes-worldwide-during-covid-19-crisis

3 CoinMarketCap. (2020) Retrieved from https://coinmarketcap.com/

4 Forbes. (2020). The Bitcoin Market Is Totally Dominated By A Tiny Number Of Pro Traders. Retrieved from https://www.forbes.com/sites/billybambrough/2020/06/18/the-bitcoin-market-is-totally-dominated-by-a-tiny-number-of-pro-traders/#26af7cd0608c

5 Financial Conduct Authority. (2020). Cryptoasset consumer research 2020. Retrieved from https://www.fca.org.uk/publication/research/research-note-cryptoasset-consumer-research-2020.pdf

6 Interpol. (2020). Cybercriminals targeting critical healthcare institutions with ransomware. Retrieved from https://www.interpol.int/en/News-and-Events/News/2020/Cybercriminals-targeting-critical-healthcare-institutions-with-ransomware

7 National Cyber Security Centre. (2020) Thanks a million: British public help reach major milestone in fight against scammers https://www.ncsc.gov.uk/news/british-public-help-reach-milestone-against-scammers

8 National Cyber Security Centre. (2020) Thanks a million: British public help reach major milestone in fight against scammers https://www.ncsc.gov.uk/news/british-public-help-reach-milestone-against-scammers

 

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Associate Director - Finex PI UK Legal Services

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