Revealed - the cost of cloud account compromises

Proofpoint and Ponemon Institute have released the results of a new study on “The Cost of Cloud Compromise and Shadow IT.” The average cost of cloud account compromises reached $6.2 million over a 12-month period, according to over 600 IT and IT security professionals in the U.S. In addition, 68 percent of these survey respondents believe cloud account takeovers present a significant security risk to their organisations, with more than half indicating the frequency and severity of cloud account compromises has increased over the last 12 months.

“This research illustrates that leaving SaaS security in the hands of end-users or lines of business can be quite costly,” said Dr. Larry Ponemon, chairman and founder of Ponemon Institute. “Cloud account compromises and sensitive information loss can disrupt business, damage brand reputation, and cost organisations millions annually.”

Only 44 percent of survey respondents believe their organisations have established clearly defined roles and accountability for safeguarding confidential or sensitive information in the cloud. Risks are also magnified as fewer than 40 percent of respondents say their organisations are vigilant in conducting cloud app assessments before deployment. 

Additional key survey findings include:

Cloud account compromises are costly incidents and present a significant security risk. According to 86% of respondents, the annual cost of cloud account compromises is over $500,000. Survey respondents also reported 64 cloud account compromises per year on average, with 30% exposing sensitive data. Nearly 60 percent of respondents indicated Microsoft 365 and Google Workspace accounts are heavily targeted by brute force and phishing-based cloud attacks. Overall, over 50 percent of respondents say phishing is the most frequent method attackers use to acquire legitimate cloud credentials.

Shadow IT is creating substantial risks for organisations. Seventy-five percent of respondents say the use of cloud apps and services without the approval of IT is a serious security risk. Additional practices also increased risks including the move to the cloud and mobile workforce (72 percent) and cloud-based collaboration/messaging tools for sharing sensitive or confidential files (70 percent). 

Strong authentication and adaptive access controls are essential in securing admission to cloud resources. Over 70 percent of respondents supported multiple identity federation standards, including SAML, and controlling strong authentication prior to accessing data and applications in the cloud. Sixty-one percent agreed adaptive access controls to protect users most at risk are essential. 

“SaaS security simply cannot be an afterthought given the high cost of cloud account compromise and today’s heightened hybrid working environment. The move to the cloud and increased collaboration requires a people-centric security strategy backed by a cloud access security broker (CASB) solution that is integrated with a larger cloud, email, and endpoint security portfolio,” said Tim Choi, vice president of Product Marketing for Proofpoint. “Such an approach effectively addresses concerns like cloud account compromise, unauthorised access to cloud data, and cloud application governance. Organisations need clearly defined roles, established accountability, and a CASB solution that can be operationalised in hours—not weeks.”