Unfortunately, 2023 has been a “banner year” for data breaches at legal firms large and small. As Above the Law posits, headlines about legal wins are welcome; headlines about cyberattacks are not. According to a survey from the American Bar Association, more than a quarter of law firms experienced a data breach last year, and this rate is only rising.
Law firms are an attractive target for attackers given the bounty of sensitive information you hold on individuals and businesses. It’s imperative that your firm protect this data and ensure client confidentiality, but how do you balance confidentiality with cybersecurity? In this post, we highlight the threat landscape you’ll face in the year ahead. We also share several strategies to maintain client trust, protect your reputation, and keep your firm secure.
Let’s ensure the headlines you receive in 2024 are positive and welcome!
The Importance of Client Confidentiality
You know this better than anyone: Client confidentiality is the cornerstone of legal ethics. Your firm has an ethical obligation to protect your client data and maintain confidentiality at every step in your relationship. Client confidentiality extends to all communication you have with your client, from in-person discussions to email to the significant amount of sensitive data you generate in your case files and store on your network. To win your case, your client needs to share information with you, from financial or business details to sensitive personal or family matters. In turn, your client entrusts you to keep this information secure.
What happens when this sensitive data is exposed because of an intrusion at your firm? What happens when your client’s confidentiality is breached? First, you fail your client. Second, you damage your reputation. Third, a breach of confidentiality can put your own firm in legal and financial jeopardy. Last year, we saw a 154% rise in federal class action lawsuits against law firm data breaches. In all cases, the basis of these lawsuits was essentially identical: the impacted legal firm did not employ adequate cybersecurity measures to protect sensitive client data.
Cybersecurity Challenges in Maintaining Confidentiality
Your law firm has an ethical obligation to understand and react to the changing threat landscape and to take the necessary precautions to safeguard data and protect client confidentiality.
Class-action lawsuits aside, a cyberattack can be a costly experience for your legal firm. A ransomware attack against a firm in Rhode Island locked critical files and the firm’s billing system for three months until an undisclosed ransom was paid in Bitcoin. The firm also lost nearly $700,000 in client billings! (Note that this breach happened as far back as 2016 and data breaches have only grown more sophisticated.)
However, we also understand that protecting your firm—and striking the right balance between confidentiality and security—requires time, expertise, and resources. Often, legal firms lack the dedicated technology support to implement these systems, even if you understand how critical these measures are. Other reasons legal firms fail to implement proper cybersecurity measures include a perception that it will be cost-prohibitive; a notion that security measures will interfere with your operations; or a belief that your firm is not a valuable target for an attacker. All are misguided assumptions.
Here's the most common threats you’re likely to encounter in the year ahead:
Data breaches: Breaches involve the theft of sensitive data, most often for financial gain or retaliatory purposes. Data breaches can originate from both outside and inside your organization.
AI-enhanced cyberattacks: As your legal firm incorporates artificial intelligence to increase productivity, reduce costs, and grow your services, cybercriminals are also leveraging AI to refocus their tactics.
Ransomware evolution: We’re seeing a worrisome shift toward new tactics like double extortion ransomware, in which a hacker threatens to sell your sensitive data to the highest bidder, publish it on the dark web, or permanently delete or restrict access to your data, even if you pay the ransom.
Phishing scams: A common scam involves a hacker sending a trustworthy-looking message that directs users to a page where they enter confidential information that is then leveraged by the attacker.
Strategies for Protecting Client Data
Given today’s threat landscape against legal firms of all sizes, it’s imperative that you implement a proactive and comprehensive cybersecurity strategy. At a minimum, we suggest you explore and incorporate the following measures to strike the right balance between cybersecurity and client confidentiality:
Network security: The best defense against a damaging data breach—no matter where it originates—is strong network security. You also want a system in place to monitor staff activity on the network.
Employee training: Learning to recognize the common traits of a cyberattack can help you and your team better identify potentially dangerous phishing attempts.
Endpoint security: Protect your endpoints with up-to-date antivirus software, firewalls, and intrusion detection systems to help you block malware before it can even infect an endpoint device.
Continuous monitoring: Network monitoring keeps tabs on your activity, applies patches, troubleshoots, and maintains endpoints for around-the-clock peace of mind. The goal is to spot a problem and fix it before you even realize there’s an issue.
When it comes to the security of your legal firm, it’s a dangerous and fast-moving world out there. You must also strike the right balance between security and client confidentiality. We know that it can be challenging to implement a robust cybersecurity strategy for your firm, especially when you’re busy focusing on what matters most: providing the best service and outcomes to your client while maintaining confidentiality and trust.
A trusted, expert partner like N8 Solutions can help you meet your security and ethical obligations in a customizable and affordable way. We can also provide employee training on ethical obligations and how to spot—and thwart—an attack. To start, just schedule a free network security risk assessment and audit to make sure your firm is ready to tackle the latest threats, and to generate positive headlines in the year ahead.. Please get in touch with us today!