United States: Save Your Data And Your Dollars: Tips To Prevent "Ransomware" From Holding Your Company Hostage

On February 15, 2016, a Los Angeles-based hospital paid cyber criminals $17,000, in the form of 40 Bitcoins, to restore access to electronic medical records and email systems. The hospital—Hollywood Presbyterian Medical Center—had been operating offline for more than a week after hackers blocked access to the hospital's shared files through the use of ransomware. The 10-day attack made electronic documentation of patient care, transmittal of lab work, and sharing of CT and X-ray results impossible and required the diversion of hundreds of patients to nearby hospitals. The hospital's radiation and oncology departments were forced to temporarily shut down, and doctors lost critical access to patients' medical history. Ransomware is a growing trend in cyber attacks, and while no business is immune, health care providers appear especially vulnerable. By taking simple preventive steps, however, all businesses can reduce the likelihood of an attack and be armed with the proper defenses in the event of an attack of this nature.

What is Ransomware?

Ransomware is malicious software that, when deployed by hackers, encrypts files and demands monetary payment to avoid deletion of those files. Unsuspecting computer users may accidentally download the malware in the following ways:

  • Clicking a malicious link in an email that appears to be from a legitimate business,
  • Downloading attachments on those emails,
  • Installing malicious software via automatic prompts, or
  • Clicking compromised advertisements on popular websites.

Once downloaded, ransomware encrypts files using a unique key stored on a remote server that will destroy the key and, with it, access to the kidnapped files, unless a monetary sum is paid (usually demanded in the form of Bitcoins, a form of digital currency that is created and held electronically). Ransomware variants have the ability to encrypt not only the initial host's hard drive but also all external and shared drives to which the infected computer has access. Without payment, the key is indecipherable and the systems remain encrypted, resulting in loss of sensitive or proprietary information, disruption of business, financial loss, and reputational harm. However, even payment cannot guarantee that hackers will follow through on their end of the bargain. The most viable solution once ransomware is deployed is to scrub affected hard drives and restore encrypted files from backup files stored offline.

While ransomware does not, on its own, steal sensitive data or personal information, it may be indicative of a larger security problem. Cyber criminals may resort to ransomware only once they have infiltrated a network, performed reconnaissance, and failed to extract financial data or other profitable information. Ransomware may also be used to cover up previous intrusions or disrupt business to serve other motives.

Ransomware on the Rise: A Problem for Health Care Providers

Hospitals and other health care providers are increasingly becoming the target of cyber attacks, as hackers seek out personal information they can turn into cash. Additionally, the outdated technology of many health care software programs, and particularly computerized medical devices such as CT scanners, fetal monitors, IV pumps, and MRIs running on old operating systems, attracts would-be cyber criminals. In January 2016, the FDA published draft guidelines to medical device manufacturers recommending manufacturers monitor and address cybersecurity vulnerabilities in their products, noting that even seemingly harmless malware may eventually provide a lateral pathway to systems hospitable to ransomware.

These vulnerabilities make health care providers, and any other businesses hosting sensitive information while using somewhat outdated technology, particularly susceptible to ransomware attacks, which are on the rise globally, according to the FBI. Just this week, Russia-based ransomware "Locky" was deployed via attachments in spam emails and has infected between 90,000 and 400,000 devices in a matter of days. Last month, Israel's Electricity Authority faced a ransomware attack that forced the regulatory entity to shut down its entire computer system. Ransomware schemes and encryption technologies now target smartphones and are becoming increasingly sophisticated, especially as cyber criminals realize the value of the data to the profitable entities they hold hostage.

Indeed, after failing to decrypt the locked files despite involvement of the LAPD and the FBI, and facing serious business interruptions, Hollywood Presbyterian executives decided to pay the 40 Bitcoin ransom to restore business systems. Although the hospital reports that no patient data was lost or accessed during this particular attack, hospitals experiencing breach of information of more than 500 patients are required by law to issue notice to patients and government regulators—a burden on health care providers who may not be so fortunate.

Tips to Prevent and Respond to a Ransomware Attack

  • Backup, Backup, Backup. A comprehensive disaster recovery plan is the only way to ensure the safety of your data in the event of a ransomware attack. Your IT department should perform at least once-daily backups and regularly test the ability to restore those backed-up files from offline sources. The alternative—paying the hackers' fee—does not guarantee you will regain access to locked files. High-level executives should coordinate with the CIO and cybersecurity law professionals to assess the sufficiency of the disaster recovery plan.
  • Train Employees. Implement phishing training for all employees, underscoring the danger of opening attachments or links in unsolicited emails, even if they appear to come from within your organization, and of installing automatic software prompts.
  • Review Your Incident Response Plan. How will your company respond in the event of a ransomware attack? It is imperative to have response protocols set forth in an incident response plan and to train employees on individual responsibilities. Consult with a cybersecurity professional to ensure the sufficiency of your IR plan.
  • Review Your Cyber Insurance Coverage. Inform yourself of whether your insurance policy covers damages associated with ransomware attacks, including business interruption, data loss, and, in a worst-case scenario, payment to hackers.
  • Review Your Vendor Contracts for Indemnity Provisions. Whether your data is stored on the cloud or third-party servers or is transmitted by vendors, it is crucial to understand where responsibility will lie in the event that a vulnerability in a vendor's system is involved in a cyber attack. Take this into consideration when entering into new business relationships, and review current service agreements and any related business associate agreements to determine potential exposure.

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 Mondaq.com.

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

Mauricio F. Paez
In association with
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
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). 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 & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd 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 or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.