What is a Supply Chain Attack & How to Prevent One

As businesses become increasingly interconnected and dependent upon global supply chains, supply chain attacks have become more pervasive throughout the world. Supply chain attacks are malicious attempts to access or disrupt vital components of a company's supply chain.  These attacks are typically initiated to gain unauthorized control of sensitive data, hold assets ransom, or cause harm to an organization's operations. 

Supply chain attacks vary in complexity, but they all pose a significant threat to a company’s operations, finances, and reputation. To protect your business from a supply chain attack, it is important to understand what they are, why they happen, and how to prevent them. 

Supply Chain Attacks: Why Do They Happen?

Attackers might exploit security vulnerabilities within a supply chain for a multitude of reasons, including:

• To gain access to sensitive data or intellectual property 
• To disrupt operations by stealing vital components or services 
• To damage a company's reputation or gain leverage in negotiations 
• To financially exploit the organization by stealing funds or resources

Businesses today rely upon interconnected networks of vendors and service providers to deliver products and services to their customers. As an organization's web of connections grows, monitoring and securing the entire supply chain becomes an increasingly nuanced and complex endeavor.

Supply chain attacks occur when an attacker takes advantage of a vulnerability to a weak link in the supply chain to gain access to sensitive information or disrupt business operations to a single business or multiple connected organizations.

Rather than mounting a direct attack on a large enterprise, today's attackers target a single supplier in the chain, potentially causing disruption to a number of larger companies that depend upon it. 

To visualize how it works, imagine that Enterprise A is dependent on Vendor B for regular shipments of products. An attacker could target Vendor B's systems in order to disrupt Enterprise A's supply chain, causing disruptions to its operations, financial losses, and potentially damaging its reputation.

Now imagine that Enterprise A has granted Vendor B digital access to its internal systems in order to monitor inventory levels and coordinate orders. Even though Enterprise A may maintain a robust cybersecurity system, if Vendor B's systems are not secure, then attackers may exploit vulnerabilities within Vendor B's systems to gain access to Enterprise A's systems as well. 

This poses a significantly greater threat than the first scenario where only the vendor was targeted.

Types of Supply Chain Attacks

The term 'Supply Chain Attack' refers to the strategy of targeting weak links within an organization's web of partners and vendors. Once they've identified a potential vulnerability, attackers may employ a variety of techniques to compromise the target's systems. 

Here are some of the common tactics cybercriminals may employ to compromise a vulnerable supply chain system: 

Malware attacks occur when malicious code is planted on a system to steal or disrupt data. This code can be embedded in legitimate software, installing itself in the background without a user's knowledge. 

Compromised development tools can be used to inject malicious code into legitimate software that is subsequently distributed to users. When the software is installed, the malicious code is activated, allowing attackers to gain access to sensitive data or disrupt operations. 

Man-in-the-middle (MitM) attacks involve hackers intercepting communications between two parties and inserting malicious code into the conversation. This allows them to gain access to sensitive data or disrupt operations. 

Watering hole attacks involve attackers planting malicious code on legitimate websites visited by target users. When the user visits the site, the malicious code is activated, allowing attackers to gain access to sensitive data or disrupt operations. 

Signed code attacks involve attackers obtaining valid digital signatures from legitimate vendors and using them to sign malicious code. This allows the malicious code to be distributed as legitimate software and evade detection. 

To learn more about the tactics malicious actors use to infiltrate vulnerable systems, read our article, 7 common cybersecurity threats and attacks in 2022. 

Cyber Vulnerabilities in Supply Chains

A supply chain's security is only as strong as its weakest link. Attackers are well aware of this and will often target vulnerable suppliers in order to gain access to sensitive data or disrupt operations. As such, it is essential for companies to understand the cyber security measures that their suppliers have in place, as any of the vendor's vulnerabilities are, by extension, the company's vulnerabilities too.

Managed Service Provider (MSP) Attacks

Managed service providers are an integral component of many supply chains, and as such, can also be vulnerable to MSP cyber attacks. Attackers often view MSPs as gateways to gain access to a company's internal networks, emphasizing the need for companies to ensure that their MSPs have robust cyber security measures in place.

When managed service providers are not properly secured, attackers can also exploit other vulnerable vendors and suppliers. This can include third-party software providers or hardware vendors, who may be providing outdated software and hardware with security vulnerabilities. 

MSPs are often targeted by malicious actors because:

• They typically manage large networks of vendors and suppliers.
• Some can be seen as a 'soft target' due to inadequate security measures relative to the scale of their operations.
• A single vulnerability can provide attackers with access to internal networks across a wide range of businesses.

Potential Consequences of a Supply Chain Attack

The consequences of a successful supply chain attack can be far-reaching and devastating. Aside from the potential financial losses, companies that experience a supply chain attack can suffer significant damage to their reputation, resulting in decreased customer confidence and trust. 

Furthermore, there may also be legal exposure and regulatory implications, as regulatory bodies may impose hefty fines against companies that have not adequately addressed the security vulnerabilities in their supply chains.

Organizations may also be required to implement costly remediation measures in order to regain compliance with industry regulations, as well as ensure the integrity of their systems. In extreme cases, companies may even have to cease operations temporarily until they are able to fully recover from the attack. 

When it comes to supply chain attacks, the old adage “prevention is better than cure” still holds true. The best way for companies to protect themselves from these types of threats is to implement robust cybersecurity measures within their own networks, as well as ensure that any third-party vendors and suppliers have the necessary safeguards in place. 

Notable Supply Chain Attacks in Recent History

Supply chain attacks can happen to companies of any size and still affect countless individuals. When these types of attacks make the news, they serve as cautionary tales for businesses that may need to improve their cybersecurity protocol, both internally and along their supply chain. 

Here are some notable supply chain attack examples from recent years.

Accellion File Transfer Attack in 2021

In February 2021, several companies were targeted in a cyber-attack that exploited a vulnerability in Accellion's File Transfer Appliance (FTA). Attackers were able to gain access to sensitive data due to the fact that many organizations had failed to update their FTA software. With over 25,000 customer networks affected by the attack, the Accellion attack infiltrated sensitive systems across the financial, healthcare, and legal sectors.

The attack serves as yet another reminder of the importance of regularly patching and updating software to ensure that any known vulnerabilities are eliminated. Companies must also ensure that they have robust cyber security measures in place, particularly when a third-party vendor is involved in their operations. 

SolarWinds Orion Attack in 2020

In December 2020, the US Department of Homeland Security revealed that the SolarWinds Orion platform had been compromised by a sophisticated attacker. The attack saw malicious code inserted into software updates for the SolarWinds Orion platform, allowing attackers to gain access to 18,000 customer networks worldwide. 

The attack resulted in significant financial losses for many organizations, as well as a loss of trust from customers due to the data breach. As such, it serves as a stark reminder of just how damaging supply chain attacks can be if they are not prevented or mitigated.

WannaCry Attack in 2017

The WannaCry ransomware attack is widely considered to be one of the most devastating cyberattacks in recent history. The attack saw malicious code inserted into an outdated version of Windows XP, which was still being used by many organizations at the time. 

The WannaCry attack resulted in significant financial losses for businesses across the world, as well as long-term reputational damage due to a series of data breaches spanning multiple industries. 

Best Practices to Avoid and Mitigate Supply Chain Attacks 

Supply chain attacks are on the rise and organizations must take steps to protect themselves with robust security measures, including: 

• Vetting third-party vendors thoroughly before working with them, including conducting extensive background checks and ensuring that all providers implement robust security measures 
• Maintaining consistent software updates and patches for all systems, including application and operating system updates 
• Implementing multi-factor authentication and advanced encryption across all systems to provide multiple layers of security 
• Segmenting systems and restricting access to authorized personnel whose job functions require it 
• Educating employees on the importance of cybersecurity and best practices
• Periodically testing systems for any vulnerabilities that may have been exploited 
• Conducting security audits and reviews on both internal systems and those of third-party vendors 
• Establishing a robust incident response plan to quickly identify and respond to any potential threats or breaches 

With the growing number of attacks occurring worldwide, maintaining security at all levels of a supply chain is critical to a business's success. 

ConnectWise Cybersecurity Management removes the complexity of maintaining an MSP-powered cybersecurity protocol by offering 24/7 threat detection monitoring and risk assessment tools to help organizations of all sizes stay ahead of security threats.

By taking proactive steps to protect against supply chain attacks, organizations can reduce their risk of becoming a target and ensure that they remain compliant with all relevant regulations. 

To stay up to date with the latest industry best practices, you can visit our Cybersecurity Center, where we’ve assembled a library of resources to help you address your organization’s cybersecurity needs. If you're interested in developing a custom solution tailored to your business's needs, contact us to consult with our team of experienced cybersecurity experts.