Data Breaches Surge in Food & Beverage, Other Industries

Though no industry is immune from cyberattacks, a few have traditionally been less affected by them than others. A new study shows that may no longer be the case.

An analysis that Kroll conducted of data breach notifications in 2020 showed a sharp increase in attacks against organizations in what it identified as six traditionally "under-attacked" industries-- food and beverage, utilities, construction, entertainment, agriculture, and recreation.

Attacks against organizations across these industries jumped by an average of 545% compared to 2019. When Kroll broke the data down by industry, it found some sectors experienced significantly higher breach increases than others. For example, data-breach notifications in the food and beverage industry shot up 1,300% in 2020 while that within the construction sector increased 800%.

Kroll also observed a 400% jump in breach notifications within the utility sector including electric utility companies, water companies, and utilities infrastructure. Already, as of April 2021, the number of breaches in this sector has surpassed all of 2020 by 25%. Because Kroll's report only considered incidents that led to breach notifications, it does not include incidents involving operation technology (OT) and industrial control system (ICS) environments.

At the other end of the spectrum, breach notifications in the entertainment industry showed a 33% increase over the previous year.

The increased number of breaches within the six industries—a pattern that has continued in the first quarater of 2021—came against the backdrop of an overall surge in the volume of data-breach notifications last year due to shifts in work environments caused by the global COVID-19 pandemic.

Kroll's data showed a 140% increase in data breach notifications from 2019 to 2020 across all verticals. That number represented one of the highest year-over-year jumps in breach notifications that Kroll has observed, says Brian Lapidus, global practice leader for Kroll's identity theft and breach notification practice.

Cybercriminals continued to hammer away at organizations in usually heavily targeted industries such as financial services, healthcare, and education. In volume, the raw number of breaches within each of these sectors continued to heavily outnumber breach disclosures in the six traditionally under-attacked sectors. For example, the average number of breaches within the most heavily attacked sectors in 2020 was 104, compared to an average of 12 breaches in the historically less-targeted sectors.

Even so, the increase in breaches within the food and beverage, utilities, construction, entertainment, agriculture, and recreations sectors showed that data breaches have become broader and deeper, Kroll said in its breach report this week. It's a trend that organizations can expect will continue at least through the post-COVID-19 recovery period, Lapidus says.

"Based on the data in our findings, we expect the trend to continue for the rest of the year" he says. "[But] as employees return to offices later in the year and in 2022, with more security systems and monitoring in place, the trend should reverse and with additional security spends, it should go down further."

Multiple Driving Factors

Kroll's study showed that the increased breach-notification volumes in sectors that were less prone to such incidents in the past was tied to four trends: the shift to remote work triggered by the pandemic; the growth of the ransomware industry; an increase in supply chain vulnerabilities; and stricter data privacy regulations.

Kroll, like numerous other vendors, found an increase in COVID-19 themed spear-phishing attacks targeting remote employees as well as more malicious activity targeting VPNs, Microsoft 365, and other platforms supporting remote workers. In sectors like food and beverage, many businesses increased direct-to-consumer digital transactions because of the pandemic, resulting in greater exposure to attacks targeting credit and debit card data.

Supply chain issues, such as leaky file transfer repositories, email platforms, and attacks on fundraising platforms were another factor. Lapidus says Kroll is unable to share specific examples of supply chain-related incidents that the company has handled. "We have seen a rise in the impact of all types of supply chain attacks," he says. "Exploit against security vulnerabilities for these six industries have grown rapidly via cybercrime groups."

Similarly, ransomware attacks have impacted organizations in the six sectors just like they have impacted entities in almost every other sector. A greater awareness of breach notification obligations under privacy regulations such as the California Consumer Privacy Act was the fourth factor that contributed to a higher number of breaches being disclosed in the six industries last year.

Lapidus says these latest vertical industry breach victims spent less on cybersecurity and had less mature security processes compared to more heavily targeted sectors such as financial services and healthcare. But the disruptions caused by the pandemic is driving change.

"We are seeing increased attention toward cybersecurity in these less traditionally targeted industries, which is a very positive trend," he says.

The initial focus has been on employee awareness and security culture training, as well as on gaining better visibility across endpoints using EDR and MDR. There is also more attention being paid to tightening remote work infrastructures such as VPN and RDP.