Ransomware Attacks Largest Cloud Provider in the Industry Cloudstar, which prevented the closure of an untold number of loans on Monday.
The implications for the title and mortgage industry can go beyond the directly affected loan applications. Cloudstar services were still down late Monday night.
In a statement, Cloudstar said it has already brought in third-party experts to help with the recovery and has already notified law enforcement. The company declined to provide an exact timeline for the restoration. Such incidents usually take between 10 days and two weeks to resolve, experts say.
“We will continue to investigate this incident and provide updates to our customers as we have additional information to share,” said a Cloudstar spokesperson.
Cloudstar declined to say how many customers were affected by the outage. But with Cloudstar services still unavailable on Monday, a significant segment of the market may not be able to close. IN American Land Titles Association said Cloudstar operates six data centers in the United States and has over 42,000 users.
Ransomware refers to the use of malicious software or malware to disable data systems in order to collect ransom. Cyberattacks usually force victims to pay a ransom so that the data is not destroyed or released.
In June, a Biden administration spokesman wrote a letter to business executives warning of ransomware attacks. Ann Neuberger, deputy national security adviser for cybersecurity and emerging technologies, wrote that the Biden administration will seek to counter cyberattacks, including by prosecuting “countries harboring ransomware participants.” The letter also called on business leaders to take action to defend against cyberattacks.
“Many ransomware criminals are aggressive and sophisticated and will find the equivalent of unlocked doors for them,” Neuberger wrote.
John-Thomas Guietto, Executive Director of Cyberspace Consulting Services at a Financial Services Company Richie May and Co, HousingWire told HousingWire that it’s no surprise that a service provider for the title industry has been the target of the latest large-scale cyberattack.
“When we sit down and talk to the leaders of the mortgage industry, the title companies are the most worrisome,” Guyetto said. “Some of them still use Hotmail’s personal webmail.”
Cloudstar’s cyberattack radius could go beyond suspended mortgages. Financial services firms that fall prey to ransomware can face long-term reputational damage and even government fines if attackers provide consumer data. (Several of Cloudstar’s competitors were quick to offer their services to affected customers when the attack became known.)
The incident could also accelerate further. consolidation in the title industry… Small businesses are unlikely to be able to defend against cyberattacks, let alone pay ransoms in the event of incidents, Guietto said.
“Ransomware will become a much more important dynamic in the industry,” Guietto said. “And I just don’t understand how small organizations continue to compete.”