Canada: Locked Out And Out-Of-Luck: The Impact Of Ransomware On Smes

Last Updated: September 22 2017
Article by Matt Saunders

Recent high-profile data breaches have emphasized the importance of protecting client, company, and personal information by governments and businesses.  In May 2017, the WannaCry ransomware attack rapidly struck many high-profile public and private targets worldwide. WannaCry effectively "locked" companies out of their data and demanded a "ransom" or payment in exchange for the data's release.1

Cyber-attacks such as WannaCry have resulted in many large corporations increasing investments and dedicating company resources to safeguard against breaches. Given the costs that can result from a data breach, it should come as no surprise.  In 2016, the average cost per compromised record in Canada was $211, while the average cost per Canadian data breach was almost $5 million. Additionally, lost goodwill may significantly impact a company's bottom line if customers lose confidence in the competency and security of the business.2

However, studies show that small and medium-sized enterprises (SMEs) need to do more to strengthen their cybersecurity plans. According to a 2017 Canadian Chamber of Commerce report, SMEs lag behind large businesses in deploying cybersecurity measures. In fact, most attacks now target SMEs specifically.  The Chamber report also indicated that 71% of data breaches happen to small businesses.3  In addition, nearly half of all small businesses in the US have been victim to a cyber-attack; rates are estimated to be a similar in Canada.

Experts believe that SMEs have become the focus of cyber criminals because these businesses are less prepared to prevent and respond to attacks. As a result, ransomware attacks can disproportionately impact SMEs.  If the targeted data is extremely valuable (e.g., helps to maintain the business' operations), the likelihood of the ransom payment being paid will increase. This was the case in a 2015 attack on a Calgary wine store. The hackers made the Kensington Wine Market's database inaccessible through a ransomware attack.  They demanded a ransom of $500 in bitcoins for the data to be released.  While the data itself was not extremely profitable to the hackers, it was critical to the wine store's operations. The wine store could not open email, review inventory, or process sales during the busy holiday season. Ultimately, the store paid the ransom because it was estimated that paying a software company to resolve the issue would cost 10 times more than the ransom.4

In 2016, the University of Calgary fell victim to a ransomware attack that encrypted staff and faculty emails.  The university paid $20,000 to regain access to their data, which was seen as a bargain given the university faculty consisted of more than 1,800 members. Even at minimum wage, an hour of time for each member represented a sum of more than $20,000.5

Whether to pay the ransom or seek the expertise of a cybersecurity specialist will depend on the objectives of the SME and the circumstances at the time of the attack.  Regardless, companies ought to spend time considering, drafting, and implementing a policy that outlines the risk assessment and response process required for a ransomware attack well before it happens.  This will allow for and improve employees' understanding of the issues at play (and highlight what to do if they face such an incident that impacts their day-to-day operations).  

It is also important to keep in mind that once the recently published and proposed Regulations of the Digital Privacy Act come into force, SMEs governed by the Personal Information Protection and Electronic Documents Act (PIPEDA) will be required to notify affected Canadians (and the Privacy Commissioner of Canada) as soon as feasible in circumstances where:

  • Personal information has been lost;
  • Stolen; and
  • The individuals are at a risk of suffering harm.

These discussions may also assist in streamlining internal protocols and external communications in the event the attack becomes public knowledge.

Although media outlets might not always report on SMEs being attacked, these businesses are increasingly becoming a target of cyber criminals. Here are some strategies that SMEs might consider in order to combat cyber-attacks:

  • It is important for SMEs to take measures to protect their systems against the constant probing of hackers. Ongoing monitoring of system security can raise awareness of impending attacks before serious damage is done.
  • Many cyber criminals check for well-known points of entry due to old patches and systems. Make sure systems, software, and applications are updated frequently.
  • Train employees to conduct themselves in a manner that does not open the company up to a potential data breach. Raising the awareness of employees of cybersecurity risks can improve prevention, reduce system gaps, and hopefully lead to an overall faster response in the event of a breach.

For a business that is just now taking stock of the cybersecurity threats it may face (and any related data privacy obligations it may have), these issues may seem daunting.  However, the team at Cox & Palmer is here to help.  Should you have any questions, please do not hesitate to contact us.

We will be holding a complimentary Breakfast Seminar on Privacy and Cybersecurity in Halifax on Tuesday, September 26, 2017. If you are interested in attending, please follow this link to RSVP.


1 Christina Mercer, "What is WannaCry? How does WannaCry ransomware work?" (15 May 2017), Techworld, online:

2 Larry Ponemon, "2016 Cost of Data Breach Study: Global Analysis" (15 June 2016), online:

3 Canadian Chamber of Commerce, "Cyber Security in Canada: Practical Solutions to a Growing Problem" (31 March 2017), online:, at 25.

4 CBC News, "Bitcoin ransom demanded by hackers of Calgary wine store" (10 December 2015), online:

5 Dave Dormer and Stephanie Wiebe, "U of C ransom payout better than battling hackers, expert says" (8 June 2016), CBC News, online:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Topics
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions