{"id":50955,"date":"2023-03-10T22:05:18","date_gmt":"2023-03-10T22:05:18","guid":{"rendered":"https:\/\/www.threatshub.org\/blog\/what-happens-if-you-cover-up-a-ransomware-infection-for-blackbaud-a-3m-charge\/"},"modified":"2023-03-10T22:05:18","modified_gmt":"2023-03-10T22:05:18","slug":"what-happens-if-you-cover-up-a-ransomware-infection-for-blackbaud-a-3m-charge","status":"publish","type":"post","link":"https:\/\/www.threatshub.org\/blog\/what-happens-if-you-cover-up-a-ransomware-infection-for-blackbaud-a-3m-charge\/","title":{"rendered":"What happens if you &#8216;cover up&#8217; a ransomware infection? For Blackbaud, a $3m charge"},"content":{"rendered":"<p>Blackbaud has agreed to pay $3 million to settle charges that it made misleading disclosures about a 2020 ransomware infection in which crooks stole more than a million files on around 13,000 of the cloud software slinger&#8217;s customers.<\/p>\n<p>According to America&#8217;s financial watchdog, the SEC, Blackbaud will cough up the cash &#8211;&nbsp;without admitting or denying the regulator&#8217;s findings &#8211; and will cease and desist from committing any further violations.<\/p>\n<p>&#8220;Blackbaud is pleased to resolve this matter with the SEC and appreciates the collaboration and constructive feedback from the Commission as the company continually improves its reporting and disclosure policies,&#8221; Tony Boor, the outfit&#8217;s chief financial officer, said told <em>The Register<\/em>.&nbsp;<\/p>\n<div aria-hidden=\"true\" class=\"adun\" data-pos=\"top\" data-raptor=\"condor\" data-xsm=\",fluid,mpu,\" data-sm=\",fluid,mpu,\" data-md=\",fluid,mpu,\"> <noscript> <a href=\"https:\/\/pubads.g.doubleclick.net\/gampad\/jump?co=1&amp;iu=\/6978\/reg_security\/cso&amp;sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&amp;tile=2&amp;c=2ZAut0P72ZdjKKnxJcBT1dAAAAMI&amp;t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0\" target=\"_blank\" rel=\"noopener\"> <img decoding=\"async\" src=\"https:\/\/pubads.g.doubleclick.net\/gampad\/ad?co=1&amp;iu=\/6978\/reg_security\/cso&amp;sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&amp;tile=2&amp;c=2ZAut0P72ZdjKKnxJcBT1dAAAAMI&amp;t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0\" alt> <\/a> <\/noscript> <\/div>\n<p>&#8220;Blackbaud continues to strengthen its cybersecurity program to protect customers and consumers, and to minimize the risk of cyberattacks in an ever-changing threat landscape,&#8221; Boor added.<\/p>\n<div aria-hidden=\"true\" class=\"adun\" data-pos=\"top\" data-raptor=\"falcon\" data-xmd=\",fluid,mpu,leaderboard,\" data-lg=\",fluid,mpu,leaderboard,\" data-xlg=\",fluid,billboard,superleaderboard,mpu,leaderboard,\" data-xxlg=\",fluid,billboard,superleaderboard,brandwidth,brandimpact,leaderboard,mpu,\"> <noscript> <a href=\"https:\/\/pubads.g.doubleclick.net\/gampad\/jump?co=1&amp;iu=\/6978\/reg_security\/cso&amp;sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&amp;tile=4&amp;c=44ZAut0P72ZdjKKnxJcBT1dAAAAMI&amp;t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0\" target=\"_blank\" rel=\"noopener\"> <img decoding=\"async\" src=\"https:\/\/pubads.g.doubleclick.net\/gampad\/ad?co=1&amp;iu=\/6978\/reg_security\/cso&amp;sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&amp;tile=4&amp;c=44ZAut0P72ZdjKKnxJcBT1dAAAAMI&amp;t=ct%3Dns%26unitnum%3D426raptor%3Dfalcon%26pos%3Dmid%26test%3D0\" alt> <\/a> <\/noscript> <\/div>\n<div class=\"adun_eagle_desktop_story_wrapper\">\n<div aria-hidden=\"true\" class=\"adun\" data-pos=\"mid\" data-raptor=\"eagle\" data-xxlg=\",mpu,dmpu,\"> <noscript> <a href=\"https:\/\/pubads.g.doubleclick.net\/gampad\/jump?co=1&amp;iu=\/6978\/reg_security\/cso&amp;sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&amp;tile=3&amp;c=33ZAut0P72ZdjKKnxJcBT1dAAAAMI&amp;t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0\" target=\"_blank\" rel=\"noopener\"> <img decoding=\"async\" src=\"https:\/\/pubads.g.doubleclick.net\/gampad\/ad?co=1&amp;iu=\/6978\/reg_security\/cso&amp;sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&amp;tile=3&amp;c=33ZAut0P72ZdjKKnxJcBT1dAAAAMI&amp;t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0\" alt> <\/a> <\/noscript> <\/div>\n<\/p><\/div>\n<p>For perspective: the South Carolina-based firm \u2013 which provides, among other things, donor management tools to nonprofits \u2013 banked <a target=\"_blank\" rel=\"nofollow noopener\" href=\"https:\/\/www.blackbaud.com\/newsroom\/article\/2023\/02\/13\/blackbaud-announces-2022-fourth-quarter-and-full-year-results\">$1.1 billion in revenue<\/a> in 2022, resulting in a $45.4 million loss. This settlement is the least of the biz&#8217;s concerns, we imagine.<\/p>\n<h3 class=\"crosshead\">Slap on the wrist<\/h3>\n<p>Here&#8217;s what happened: back in May 2020, Blackbaud experienced a ransomware infection, quietly paid off the crooks, and <a target=\"_blank\" href=\"https:\/\/www.theregister.com\/2020\/07\/17\/blackbaud_paid_ransomware\/\" rel=\"noopener\">didn&#8217;t tell customers<\/a> about the security breach until July 2020. And when the software company did notify customers, it assured them that the &#8220;cybercriminal did not access\u2026bank account information, or social security numbers,&#8221; according to the SEC order [<a target=\"_blank\" rel=\"nofollow noopener\" href=\"https:\/\/regmedia.co.uk\/2023\/03\/10\/sec_order_blackbaud.pdf\">PDF<\/a>].<\/p>\n<p>By the end of that month, however, the SEC claims that Blackbaud personnel discovered that the miscreants had accessed unencrypted donor bank account information and social security numbers.&nbsp;But the employees allegedly didn&#8217;t tell senior management about the theft of sensitive customer data because Blackbaud &#8220;did not have policies or procedures in place designed to ensure they do so,&#8221; the court documents say. Make of that what you will.<\/p>\n<p>This, in turn, resulted in the company filing a quarterly SEC report that omitted this material information about the scope of the cyberattack, and according to the agency, &#8220;misleadingly characterized the risk of an attacker obtaining such sensitive donor information as hypothetical.&#8221;<\/p>\n<p>A month later, company execs filed an amended Form 8-K [<a target=\"_blank\" rel=\"nofollow noopener\" href=\"https:\/\/regmedia.co.uk\/2020\/10\/01\/blackbaud8k.pdf\">PDF<\/a>] about the ransomware infection, and admitted for the first time that criminals &#8220;may have accessed some unencrypted&#8221; customer banking information. Oops.<\/p>\n<p>&#8220;&#8221;As the order finds, Blackbaud failed to disclose the full impact of a ransomware attack despite its personnel learning that its earlier public statements about the attack were erroneous,&#8221; David Hirsch, chief of the SEC Enforcement Division&#8217;s Crypto Assets and Cyber Unit said in a <a target=\"_blank\" rel=\"nofollow noopener\" href=\"https:\/\/www.sec.gov\/news\/press-release\/2023-48\">statement<\/a>. &#8220;Public companies have an obligation to provide their investors with accurate and timely material information; Blackbaud failed to do so.&#8221;<\/p>\n<div aria-hidden=\"true\" class=\"adun\" data-pos=\"top\" data-raptor=\"falcon\" data-xsm=\",fluid,mpu,\" data-sm=\",fluid,mpu,\" data-md=\",fluid,mpu,\"> <noscript> <a href=\"https:\/\/pubads.g.doubleclick.net\/gampad\/jump?co=1&amp;iu=\/6978\/reg_security\/cso&amp;sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&amp;tile=4&amp;c=44ZAut0P72ZdjKKnxJcBT1dAAAAMI&amp;t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0\" target=\"_blank\" rel=\"noopener\"> <img decoding=\"async\" src=\"https:\/\/pubads.g.doubleclick.net\/gampad\/ad?co=1&amp;iu=\/6978\/reg_security\/cso&amp;sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&amp;tile=4&amp;c=44ZAut0P72ZdjKKnxJcBT1dAAAAMI&amp;t=ct%3Dns%26unitnum%3D426raptor%3Dfalcon%26pos%3Dmid%26test%3D0\" alt> <\/a> <\/noscript> <\/div>\n<p>The ransomware infection \u2014&nbsp;and lack of transparency about the security snafu \u2014 also sparked several <a target=\"_blank\" href=\"https:\/\/www.theregister.com\/2021\/08\/17\/ccpa_blackbaud\/\" rel=\"noopener\">class action lawsuits<\/a> against&nbsp; Blackbaud. This might prove a very expensive error. \u00ae<\/p>\n<p> <!-- xssi --> READ MORE <a href=\"https:\/\/go.theregister.com\/feed\/www.theregister.com\/2023\/03\/10\/sec_blackbaud_3m_penalty\/\">HERE<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>File under cost of doing business Blackbaud has agreed to pay $3 million to settle charges that it made misleading disclosures about a 2020 ransomware infection in which crooks stole more than a million files on around 13,000 of the cloud software slinger&#8217;s customers.\u2026 READ MORE HERE&#8230;<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"colormag_page_layout":"default_layout","footnotes":""},"categories":[63],"tags":[],"class_list":["post-50955","post","type-post","status-publish","format-standard","hentry","category-the-register"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v28.1 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>What happens if you &#039;cover up&#039; a ransomware infection? 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