Third-Party Network Breaches Continue to Rise

March 14, 2016//Ellen Neveux

Last Updated: July 23, 2021

New reports flag the high risk of data breach through third-party vendors.

Service providers in the digital security industry are positioned to offer insight into current and emerging threats to data and brand safety. Two reports, one from an insurance provider, and the other from a digital security company, point to continued risk from the insecure electronic networks of outsourced service providers.

Across industry, outsourcing offers tremendous opportunity for businesses to access specialized skills, gain service, and reduce costs. As we discussed earlier, even organizations with robust network security can easily fall victim to supply chain hacks on a third party vendor.

In March, specialty insurer Beazley released its annual data breach response report for 2016. Detailing incidents that occurred in 2014 and 2015, the report offers insights that include:

  • Use of malware, like ransomware, has increased across industry, especially in healthcare settings.
  • Financial and university clients continue to see higher rates of attacks through social engineering and malware.
  • Data breaches involving third party vendors tripled in the period between 2014 and 2015.

146 days to discover a breach
Mandiant Consulting is a digital security consulting arm of the FireEye Company. The company notes the average length of time from when their incident clients are breached, to when the breach is discovered or reported, is approximately 146 days. While Mandiant notes the number of days have declined since 2014, time remains on the side of threat actors who exfiltrate data, damage network systems, and injure brand reputation.

In a recent report, Mandiant identified abuse of outsourced service providers (OSPs) as a “trend turned constant.” Based on their own incident reports, Mandiant noted they “continued to observe advanced attack groups leveraging outsourced service providers to intrude onto the networks of our customers.”

Some key points made by Mandiant include:

  • The rate of third-party breach continues to rise as businesses continue to expand their reliance on outsourcing.
  • Intruders gain access to targets through the less restrictive network pathways of outsourced vendors.
  • Mandiant reports hackers have recently used the credentials of third-party service providers to gain access to credit card data in the hospitality and retail industries. Mandiant also observed hackers exploiting OSP credentials associated with unsecured data files owned by the hacking target.
  • According to the company, the internet technology outsourcing (ITO) industry was the source of highest loss for clients during its reporting period, stating, “Our investigations revealed that attackers were maintaining access to the ITOs by gaining access to the ITO management servers that these service providers use to support their clients’ infrastructure.”

Whether from core or non-core services, or access gained through the Internet of Things, the risk of third-party network breach continues to increase. The SecureLink platform provides effective controls in highly secure and regulated industries.

When your vendor network must be secure — speak with our team.

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