Thanks to the boogeyman, I’m afraid of the dark. He hid in my closet and under my bed when I was younger. Not sure what he wanted, but as a (insert grain of salt here) grown-up in this cyberthreat-saturated world, I still see him. He comes in different forms now, though. Sometimes he’s an SQL injection wanting data or a denial-of-service attack wanting network disruption; and sometimes he’s ransomware, wanting bitcoins.

Ransomware is malware that encrypts files and deletes the originals, thereby making access impossible unless a ransom is paid. It also may lock the whole system and then sell the user the password needed to unlock it. Usually the ransom is paid by going to a website devised by the attacker that asks the victim to enter a unique key. Only after paying the ransom, often via bitcoin or other electronic currency, will the user be given the password to unlock the files.

8 out of 10 CIOs Think Ransomware Is a Challenge

Eight out of 10 security leaders surveyed in the IBM 2014 CISO Assessment see the challenge posed by external threats rising to include not only financial and intellectual property theft but also ransomware. That’s because successful ransomware such as CryptoLocker and CryptoWall is now costing organizations millions globally.

In fact, CryptoWall has surpassed CryptoLocker in terms of infection rate. Its malware and infrastructure may not be as sophisticated as CryptoLocker’s, but it’s undeniably one of the most destructive ransomware families circulating today. The most recent version, CryptoWall 3.0, uses the Tor anonymity network for command-and-control (C&C) communications and is especially aggressive. Infections for CryptoWall 3.0 are on the rise.

As if we didn’t have enough to deal with, most cyberthreats make their way over to the mobile arena. Pletor, the first dedicated mobile malware, began circulating in May of last year. Soon there were multiple families of mobile ransomware — ScarePakage, ScareMeNot, ColdBrother and Koler, among others — with a huge impact. According to the 2014 Mobile Threat Report, ScareMeNot and ScarePakage were among the top five most prevalent mobile threats in countries such as the U.S., U.K. and Germany.

To Pay or Not to Pay

How does someone become a victim of ransomware? Spam and phishing campaigns are tried-and-true attack tools and are often used to deliver ransomware. The email message contains a malicious attachment or a link to a malicious file. Once activated, the ransomware may impose a time limit for payment. This malware can also be delivered by exploit kits on compromised Web pages and malicious sites. When a user visits a compromised site serving exploit kit code, the code tries to identify potential vulnerabilities on the user’s system and serves exploits accordingly. Drive-by downloads provide another infection vector.

Once the ransom note appears, organizations face the difficult decision of striking a deal with the criminals or not. Many organizations place a higher importance on recovering their valuable data. In one recent cyber extortion report, 30 percent of security professionals were willing to negotiate. Among organizations already victimized by cybercriminals, that figure rose to 55 percent.

I Guess That’s It Then, They Win

Don’t go setting up an incidental expense account filled with bitcoins just yet — all is not lost. Ransomware is certainly on the rise, but organizations that implement the security recommendations like those suggested in the IBM research report “What You Need to Know about Ransomware” will be better prepared to protect their critical assets from the threat.

Fortunately, companies can take steps to detect and stop ransomware, chiefly by implementing an anti-malware solution and keeping patches up to date. A regularly updated backup is always essential and is absolutely critical should first-line defenses fail.

Download the complete Ransomware Response Guide