Updated: Everything you need to know about ransomware: how it started, why it's booming, how to protect against it, and what to do if your PC's infected.
All you need to know about ransomware in 60 seconds
What is a ransomware attack?
Ransomware is one of the biggest problems on the web right now. It's a form of malware which encrypts documents on a PC or even across a network. Victims can often only regain access to their files and PCs by paying a ransom to the criminals behind it. A ransomware infection often starts with someone clicking on what looks like an innocent attachment, and it can be a headache for companies of all sizes.
Cybercriminals didn't use to be so obvious. If hackers infiltrated your corporate network, they would do everything possible to avoid detection. It was in their best interests not to alert a victim that they'd fallen victim to cybercrime.
But now, if you are attacked with file-encrypting ransomware, criminals will brazenly announce they're holding your corporate data hostage until you pay a ransom in order to get it back. It might sound too simple, but it's working: cybercriminals pocketed over $1bn from ransomware attacks during 2016 alone.
What is the history of ransomware?
While ransomware exploded last year, increasing by an estimated 748 percent, it's not a new phenomenon; the first instance of what we now know as ransomware appeared in 1989.
Known as AIDS or the PC Cyborg Trojan, the virus was sent to victims -- mostly in the healthcare industry -- on a floppy disc. The ransomware counted the number of times the PC was booted: once it hit 90, it encrypted the machine and demanded the user 'renew their license' with 'PC Cyborg Corporation ' by sending $189 or $378 to a post office box in Panama.
The AIDS demand for payment - by post. Image: Sophos
How did ransomware evolve?
This early ransomware was a relatively simple construct, using basic cryptography which mostly just changed the names of files, making it relatively easy to overcome.
But it set off a new branch of computer crime, which slowly but surely grew in reach -- and really took off in the internet age. Before they began using advanced cryptography to target corporate networks, hackers were targeting general internet users with basic ransomware.
One of the most successful variants was 'Police ransomware', which tried to extort victims by claiming to be law enforcement and locking the screen with a message warning the user they'd committed illegal online activity, which could get them sent to jail.
However, if the victim paid a fine, the 'police' would let the infringement slide and restore access to the computer. Of course, this wasn't anything to do with law enforcement -- this was criminals exploiting innocent people.
An example of 'Police ransomware' threatening a UK user.
While somewhat successful, these forms of ransomware often simply overlaid their 'warning' message on the user's display -- and rebooting the machine could get rid of the problem.
Criminals learned from this and now the majority of ransomware schemes use advanced cryptography to truly lock down an infected PC.
What are the main types of ransomware?
Ransomware is always evolving, with new variants continually appearing in the wild and posing new threats to businesses. However, there are certain types of ransomware which have been much more successful than others.
Perhaps the most notorious form of ransomware is Locky, which terrorised organisations across the globe throughout 2016. It infamously made headlines by infecting a Hollywood hospital. The hospital gave into the demands of cybercriminals and paid a $17,000 ransom to have its networks restored.
Locky remained successful because those behind it regularly update the code with changes which allow it to avoid detection. They even update it with new functions, including the ability to make ransom demands in 30 languages, helping criminals more easily target victims in around the world. Locky became so successful, it rose to become most prevelant forms of malware in its own right.
Cryptowall is another form of ransomware which has found great success for a prolonged period of time. Starting life as doppleganger of Cryptolocker, it's gone onto become one of the most successful types of ransomware.
Like Locky, Cryptowall has regularly been updated in order to ensure its continued success and even scrambles file names to make it harder for victims to know which file is which, putting additional pressure on the victim to pay
While some ransomware developers -- like those behind Locky or Cryptowall -- closely guard their product, keeping it solely for their own use, others happily distribute ransomware to any wannabe hacker keen to cash in on cyber extortion - and it's proved to be a very successful method for wide distribution.
One of the most common forms of ransomware distributed in this way is Cerber, which has been known to infect hundreds of thousands of users in just a single month. The original creators of Cerber are selling it on the dark web, allowing other criminals to use the code in return for receiving 40 percent of each ransom paid.
Cerber has become so successful that after it has surpassed Locky - which appeared to mysteriously disappear over Christmas, although remerged in April with new attack techniques - to become the most dominant form of ransomware on the web - accounting for 90 percent of ransomware attacks on Windows as of mid-April 2017.
In exchange for giving up some of the profits for using Cerber, wannabe cyber fraudsters are provided with everything they need in order to successfully make money through extortion of victims.
Indeed, now some criminal groups offer this type of ransomware-as-a-service scheme to potential users at no cost at the point of entry. Instead of charging a fee for the ransomware code, they want a 50 percent cut.
What is WannaCry ransomware?
In the biggest ransomware attack to date, WannaCry - also known as WannaCrypt - also known as WannaCry and Wcry - caused chaos across the globe in an attack which started on Friday 12th May 2017.
Wannacrypt ransomware demands $300 in Bitcoin for unlocking encrypted files - a price which doubles after three days. Users are also threatened with having all their files permanently deleted if the ransom isn't paid within a week.
WannaCry ransomware infected Windows XP systems across the globe.
Image: Cisco Talos
More than 300,000 victims in over 150 countries fell victim to the ransomware on over the course of one weekend, with businesses, governments and individuals across the globe all affected.
Healthcare organizations across the UK had systems knocked offline by the ransomware attack, forcing patient appointments to be cancelled and hospitals telling people to avoid visiting Accident & Emergency departments unless it was entirely necessary.
Of all the countries hit by the attack, it was Russia which was hit the hardest, with WannaCry crashing Russian banks, telephone operators and even IT systems supporting transport infrastructure. China was also hit hard by the attack, with 29,000 organizations in total falling victim to this particularly vicious form of ransomware.
Other high-profile targets included the car manufacturer Renault which was forced to halt production lines in several locations as the ransomware played havoc with systems.
What all the targets had in common is that they were running unsupported versions of Microsoft Windows, including Windows XP, Windows 8 and Windows Server 2003
The ransomware worm is so potent because it exploits a known software vulnerability known as Eternal Blue. The Windows flaw is one of many zero-days which apparently was known by the NSA -- before being leaked by the Shadow Brokers hacking collective. Microsoft released a patch for the vulnerability earlier this year - but only for the most recent operating systems.
In response to the attack, Microsoft took the unprecedented step of issuing patches for unsupported operating systems.
Security services in the US and the UK have since pointed to North Korea as being the perpetrator of the WannaCry ransomware attack. However, if the goal of the scheme was to make large amounts of money, it failed - only about $100,000 was paid and the earnings have yet to be taken from the Bitcoin wallets.
What is Petya/NotPetya/GoldenEye?
A little a month after the WannaCry ransomware outbreak, the world was hit with another global ransomware attack.
This cyberattack first hit targets in Ukraine, including its central bank, main international airport and even the Chernobyl nuclear facility before quickly spreading around the globe, infecting organisations across Europe, Russia, the United States and even Australia.
After some initial confusion as to what this malware was - some said it was Petya, some said it was something else - researchers at Bitdefender came to the conclusion suggest that this outbreak is down to a modified version of Petya ransomware, combining elements of GoldenEye - a particularly vicious relative of Petya - and WannaCry ransomware into something extremely potent.
Petya ransom note Image: Symantec
Yes, this second form of ransomware also exploits the same EternalBlue Windows flaw which provided WannaCry with the worm-like features to spread through networks and hit 300,000 computers around the world - except Petya/NotPetya/GoldenEye is a much more vicious attack.
But not only does this attack encrypt victims' files, it also encrypts entire hard drives by overwriting the master reboot record, preventing the computer from loading the operating system or doing anything.
The attackers ask for a Bitcoin ransom of $300 to be sent to a specific email address - which has now been shut down by the email service - host, but the the way this very sophisticated ransomware apparently was equipped with very basic, non-automated functions for accepting ransoms has lead some to suggest money isn't the goal.
How much will a ransomware attack cost you?
Obviously, the most immediate cost associated with becoming infected with ransomware -- if paid -- is the ransom demand, which can depend on the type of ransomware or the size of your organisation.
Recent research revealed that a quarter of companies which paid a ransom paid over £5,000 to retrieve their data, while a further quarter paid hackers between £3,000 and £5,000.
The most common ransom paid amongst small and medium-sized businesses was between £500 and £1500, proving that there's still easy money to be made from targeting organisations of this size.
There are also examples of high-profile targets paying five-figure fees in order to regain access to their networks, especially in cases where criminals threaten to delete data if they're not paid.
Ultimately, whatever the size of the company, time is money and the longer your network is down, the more it's going to cost your business.
Even if you regain access to your networks by paying a ransom, there will be additional costs on top of that. In order to avoid future attacks -- especially if you've been marked as an easy target -- be prepared to invest in additional cybersecurity software and to pay for additional staff training.
There's also the risk of customers losing trust in your business because of poor cybersecurity and taking their custom elsewhere.
Why should businesses worry about ransomware?
To put it simply: ransomware could ruin your business. Being locked out of your own network for even just a day will impact on your revenue. But given that ransomware takes most victims offline for at least a week, or sometimes months, the losses can be significant. Systems go offline for so long not just because ransomware locks the system, but because of all the effort required to clean up and restore the networks.
And it isn't just the immediate financial hit of ransomware which will damage a business; consumers become wary of giving their custom to organizations they believe to be insecure.
How does ransomware infect your PC?
It's the modern enterprise's reliance on the internet which is enabling ransomware to boom. Everyday, every employee receives hundreds of emails and many roles require these employees to download and open attachments, so it's something which is often done on autopilot. Taking advantage of employees' willingness to open attachments from unknown senders is allowing cybercriminals to successfully run ransomware campaigns.
Like other forms of malware, botnets send ransomware out en masse, with millions of malicious phishing emails sent every single second. Criminals use a variety of lures to encourage targets to open a ransomware email, ranging from offers of financial bonuses, fake online purchase receipts, job applications from prospective employees, and more.
A spam email claiming the target has purchased a flight - complete with fake invoice containing the ransomware. Image: Symantec
While some messages give away clues to their malicious nature with poorly-worded messages or strange return addresses, others are specially tailored to look as convincing as possible, and appear no different from any other message the victim might be sent.
Once the malicious attachment has been opened, the user is encouraged to enable macros in order to view and edit the document. It's when this is enabled that the ransomware code hidden within the macros strikes. It can encrypt files in seconds, leaving the victim with a ransom note demanding a payment ranging from a few hundred dollars to tens of thousands of dollars in order to get them back.
Which organizations are targets for ransomware?
Any business can find itself a victim of ransomware, but perhaps the most high-profile incident occurred when the Hollywood Presbyterian Medical Center in Los Angeles became infected with Locky ransomware. The infection left doctors and nurses unable to access patient files for days, until the hospital opted to give into the ransom demands of hackers in order to restore services.
"The quickest and most efficient way to restore our systems and administrative functions was to pay the ransom and obtain the decryption key," Allen Stefanek, CEO of the hospital, said at the time.
Locky is one of the most successful forms of ransomware. Image: F-Secure
Hospitals and other healthcare organizations are popular targets for ransomware attacks, because they are often willing to pay. Losing access to data is a life-or-death matter for them -- and hospitals don't want to be held responsible for letting people die due to poor cybersecurity. However, there are even cybercriminals who think attacking hospitals is too despicable an activity.
But there are plenty of other sectors criminals will happily target, including educational institutions, such as the University of Calgary, which paid a ransom of $20,000 to hackers. Any large business is at threat and there's even the prospect of ransomware infecting industrial systems.
Why are small businesses targets for ransomware?
Small and medium -ized businesses are a popular target because they tend to have poorer cybersecurity than large organizations. Despite that, many SMEs falsely believe they're too small to be targeted -- but even a 'smaller' ransom of a few hundred dollars is still highly profitable for cybercriminals.
Why is ransomware so successful?
You could say there's one key reason why ransomware has boomed: because it works. Organizations can have the best antivirus software in the world, but all it takes for ransomware to infect the network is for one user to slip up and launch a malicious attachment.
If organizations weren't giving in to ransom demands, criminals would stop using ransomware. But businesses do need access to data in order to function so many are willing to pay a ransom and get it over and done with.
Meanwhile, for criminals it's a very easy way to make money. Why spend time and effort developing complex code or generating fake credit cards from stolen bank details if ransomware can result in instant payments of hundreds or even thousands of dollars from large swathes of infected victims at once?
There are even ransomware-as-a-service schemes available on the dark web which allow the most technically inept wannabe cybercriminals to start sending out ransomware -- in exchange for a percentage of their ill-gotten gains going directly into the pockets of the creators.
What does Bitcoin have to do with the rise of ransomware?
The rise of crypocurrencies like Bitcoin has made it easy for cybercriminals to secretly receive extorted payments, without the risk of the authorities being able to identify the perpetrators. The secure, untraceable method of making payments makes it the perfect currency for criminals who want their financial activities to remain hidden.
Cybercriminal gangs are becoming more professional -- some even offer customer service and help for victims who don't know how to acquire or send Bitcoin, because what's the point of making ransom demands if users don't know how to pay?
Globe3 ransom demand for 3 Bitcoin - including a 'how to ' guide for those who don't know how to buy it Image: Emsisoft Lab
How do you prevent a ransomware attack?
With email being by far the most popular attack vector for ransomware, you should provide employees with training on how to spot an incoming attack. Even picking up on little indicators like poor formatting or that an email purporting to be from 'Microsoft Security' is sent from a obscure address which doesn't even contain the word Microsoft within it might save your network from infection.
There's also something to be said for enabling employees to learn from making mistakes while within a safe environment. For example, one firm has developed an interactive video experience which allows its employees to make decisions on a series of events then find out the consequences of those at the end. This enables them to learn from their mistakes without suffering any of the actual consequences.
On a technical level, stopping employees from being able to enable macros is a big step towards ensuring that they can't unwittingly run a ransomware file. Microsoft Office 2016 -- and now Microsoft 2013 -- both carry features which allow macros to be disabled. At the very least, employers should invest in antivirus software and keep it up-to0date, so that it can warn users about potentially malicious files.
How do I get rid of ransomware?
The 'No More Ransom' initiative -- launched by Europol and the Dutch National Police in collaboration with a number of cybersecurity companies -- offers free decryption tools for ransomware variants to help victims retrieve their data without succumbing to the will of cyber extortionists.
The portal offers decryption tools for ransomware variants including Crypt XXX, MarsJoke, Teslacrypt, and Wildfire. It's updated as often as possible in an effort to ensure tools are available to fight the latest forms of ransomware.
The No More Ransom portal offers free ransomware decryption tools. Image: Europol
Another way of working around a ransomware infection is to ensure your organisation regularly backs up data offline. It might take some time to transfer the backup files onto a new machine, but if a computer is infected and you have backups, it's possible just to isolate that unit then get on with your business.
Should I pay a ransomware ransom?
There are those who say victims should just pay the ransom, citing it to be the quickest and easiest way to retrieve data -- and many organizations do pay.
But be warned: if word gets out that your organization is an easy target for cybercriminals because it paid a ransom, you could find yourself in the crosshairs of other cybercriminals who are looking to take advantage of your weak security.
And remember that you're dealing with criminals here and their very nature means they may not keep their word. There are stories of victims paying ransoms and still not having files returned.
What's the future of ransomware?
Ransomware is continually evolving, with an increasing number of variants now engaging in additional activities such as stealing data or weakening infected computers in preparation for future attacks.
Researchers even warn that ransomware could soon hold whole operating systems hostage, to such an extent that the only two options available to the user would be to pay, or to lose access to the entire system.
And ransomware isn't just a problem for Windows PCs; Apple Macs are vulnerable to it too.
Can you get ransomware on your smartphone?
Absolutely. Ransomware attacks against Android devices have increased massively, as cybercriminals realise that many people aren't aware that smartphones can be attacked.
In fact, any internet-connected device is a potential target for ransomware, which has already been seen locking smart TVs.
Researchers demonstrate ransomware in an in-car infotainment system.
Image: Intel Security
Ransomware and the Internet of things
Internet of things devices already have a poor reputation for security. As more and more of these make their way onto the market, they're going to provide billions of new attack vectors for cybercriminals, potentially allowing hackers to hold your connected home or connected car hostage.
There's even the potential that hackers could infect medical devices, putting lives directly at risk.
As ransomware continues to evolve, it's therefore crucial for your employees to understand the threat it poses, and for organizations to do everything possible to avoid infection, because ransomware can be crippling.