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Medibank data leak threatened by cybercriminal as class action lawsuits loom

A cybercriminal individual or group demanding a ransom has threatened to release Medibank client data as Australia’s largest health insurer faces a possible class action over the hacking of sensitive information for 9.7 million current and former customers.

Medibank has confirmed almost 500,000 health claims were accessed and the personal details of former and current customers were exposed when an unnamed group hacked into its system weeks ago.

Around midnight, an individual or group posted a ransom demand to its dark web blog that “data will be publish [sic] in 24 hours”.

“P.S. I recommend to sell medibank [sic] stocks.”

Shortly after 11am AEDT on Tuesday, Medibank shares were down around 2.8 per cent, to $2.75, amid the threats of the data leak and lawsuits.

The post did not include data samples to back up the threat and prove that the group actually had access to the hacked information.

On Tuesday, cybersecurity expert Tony Hunt commented on the development.

“This is horrendous, but not unsurprising if you look at ransomware like a business,” Mr Hunt posted.

“If they *don’t* dump the data publicly, what message does that send to future ‘customers’?”

‘Distressing development’

The company released a statement this morning noting that it was aware of media reports of the “purported threat” to released hacked customer data.

“Customers should remain vigilant,” said Medibank chief executive David Koczkar in the statement.

“We knew the publication of data online by the criminal could be a possibility, but the criminal’s threat is still a distressing development for our customers.

“We unreservedly apologise to our customers. We take seriously our responsibility to safeguard our customers and support them.

“The weaponisation of their private information is malicious, and it is an attack on the most-vulnerable members of our community.”

On Monday, the Medibank boss said that paying a ransom could make Australia a bigger target for data theft by giving criminals an incentive.

“Based on the extensive advice we have received from cybercrime experts, we believe there is only a limited chance paying a ransom would ensure the return of our customers’ data and prevent it from being published,” Mr Koczkar said.

Home Affairs Minister Clare O’Neil said Medibank’s decision not to pay a ransom to cyber criminals was in line with government advice.

Appearing at a Senate estimates hearing on Tuesday, Australian Federal Police commissioner Reece Kershaw fired a warning at businesses to ensure they contacted authorities as early as possible when a data breach might be occurring.

With the AFP launching operations to tackle both the Medibank and Optus data breaches, Mr Kershaw said the long and complex investigations would use significant resources.

“Apart from sending a warning to cyber criminals that the AFP will relentlessly pursue them, I also have a message to business: Please alert authorities immediately when a data breach is suspected,” he said.

“It’s like any crime scene. The longer it takes relevant agencies to be informed, the harder it is for perpetrators to be identified, disrupted or brought to justice.”

Medibank class action looming

Meanwhile, two law firms — including one behind a successful case involving a NSW Ambulance data breach — said they believed Medibank betrayed customers and breached the Privacy Act by not stopping the hack.

“Medibank has a duty to keep this kind of information confidential,” Bannister Law and Centennial Law said in a statement late on Monday.

“This latest data breach exposes the lack of safeguards in place to prevent such personal and private information being released to wrongdoers and Medibank and ahm have failed policyholders in these circumstances.”

The law firms will investigate the terms of the contracts the medical insurance provided to customers and whether damages are appropriate.

No case has yet been filed with a court.

The hacker accessed the health claims of about 160,000 Medibank customers, about 300,000 claims from customers of offshoot ahm and about 20,000 international customers.

Names, dates of birth, address, phone numbers and email addresses were also accessed, raising concerns about future identity fraud.

No credit card or banking details were accessed.

Medibank has urged its customers to be vigilant with all online communications and transactions, including the risk of phishing scams, texts or emails from unknown senders and with changing passwords.

The company reiterated that it would never contact customers and ask for password or other sensitive information.

Customers are advised to call the company with any further enquiries on 12 23 31 for Medibank and international customers, 13 42 46 for ahm customers and 1800 081 245 for My Home Hospital patients.

Source : ABC News