Next named Market Leader and Outperformer in GigaOm DLP Market Radar Report Read the Report
Updated: Feb 9, 2024   |   Toby Bristow

What is data exfiltration? (and how to prevent it)

Go back

Protecting an organization from data exfiltration requires a comprehensive and multifaceted approach. This article takes a detailed look at data exfiltration from multiple perspectives. We cover the dangers of data exfiltration, who conducts exfiltration attempts, and the methods they employ. 

We’ll also look at the warning signs of data exfiltration attempts in an environment, how to detect them, and perhaps most importantly, how to prevent them from successfully compromising valuable data resources.

In our discussion, we will assume that the exfiltrated data holds value to the organization or comprises sensitive information that needs to be kept confidential. Confidentiality must be maintained for business purposes or to address regulatory compliance.

In this article:

Wh‎at is data exfiltration?

Person typing on a laptop with graphic overlay showing files, data, and a padlock icon

‎Data exfiltration is the technical term that describes the unauthorized extraction of high-value or sensitive data from an IT environment to an alternate location. 

Data exfiltration is typically associated with data breaches perpetrated by external threat actors or malicious insiders, although it can also describe data leaks caused by the accidental mishandling of information.

Wh‎at are the dangers of data exfiltration?

Data exfiltration dangers, identity theft concept

Exfiltration is essentially the theft of an organization’s data resources. The theft can have narrow or wide-ranging consequences based on the specific information in question and the targeted organization’s business or industry. 

Companies may have to address the following dangers and risks that can result from data exfiltration:

  • Data breaches involving confidential information - Organizations may be impacted by a data breach involving the disclosure of sensitive or valuable data assets. Depending on the type of information that is disclosed, the company may face legal, regulatory, and public relations ramifications that persist long after the exfiltration incident.
  • Operational disruptions - Responding to a data exfiltration incident requires a company to devote time and technical resources to investigate the breach and try to minimize its damage. Utilizing these resources can be costly and negatively impact normal business operations and customer service.
  • Intellectual property loss - Exfiltration of high-value data such as intellectual property or trade secrets can have devastating effects on a company. The data loss can damage an organization’s ability to remain competitive and may even force a business to close.
  • Identity theft and fraud - Exfiltrated data can include personally identifiable information (PII) or other sensitive data that can be used by cybercriminals to perpetrate identity theft and fraud. This can have severe and long-term financial and reputational damage to the affected individuals.
  • Reputational and brand damage - Companies that have been victimized by data exfiltration and the disclosure of customers’ personal information will often suffer long-term damage to their brand image and reputation. Negative publicity will influence customers and clients who may lose trust in the ability of the organization to protect these valuable and sensitive data resources, resulting in a loss of business.
  • Violating regulatory standards - Companies are required to protect sensitive information to comply with regulations such as the Health Insurance Portability and Accountability Act (HIPAA), or Payment Card Industry Data Security Standard (PCI DSS). Unauthorized disclosure of this type of information may result in substantial legal and financial penalties levied by the regulatory agencies on top of the reputational damage caused by the breach.
  • National security risks - Data exfiltration affecting organizations operating in the essential infrastructure or defense sector may result in national security risks. Sensitive government information, strategic intelligence, and the data required to maintain essential services can be compromised with catastrophic consequences for the victimized nation and its citizens.

In many cases, the long-term repercussions of data exfiltration can be as damaging as the initial effects. While the technical vulnerability that enabled the data breach may be quickly addressed, it can take much longer to rebuild the trust of individuals affected by the disclosure of their personal information. 

Likewise, closing the door after trade secrets have been stolen by the competition does nothing to address the lasting effects of the theft on the business.

Wh‎o performs data exfiltration?

Person using a computer with keyboard and multiple screens in a dark setting

‎Data exfiltration may be performed by a range of entities for a wide variety of reasons. This fact complicates an organization’s efforts to prevent the practice. 

Exfiltration attempts are often perpetrated with some degree of malicious intent. The group or individual exfiltrating data is doing so to benefit themselves and/or to damage the victim in some way.

Two distinct groups – external threat actors and malicious insiders – typically engage in intentional data exfiltration. They have similar motives driving their activities and both pose threats to an organization’s data security. A third group - well intentioned insiders who are naively unaware of the unintended consequences of their actions - also exists.

External threat actors

External threat actors come in a wide variety of guises. Their ultimate goal is to exfiltrate valuable or sensitive information from an organization using the methods we will describe in the next section. 

However, while their objectives may be similar, the reasons behind their incursions can be very different. 

The following are some of the different types of external threat actors who may be looking to exfiltrate a company’s data assets.

  • Cybercriminals - Individuals or cybercriminal syndicates see data exfiltration as a money-making venture. They are often associated with ransomware attacks that simultaneously encrypt and exfiltrate data resources. Companies are extorted with ransom demands to regain access to their data or to prevent the disclosure of the exfiltrated information.
  • Competitors - Business rivals and competitors may be motivated to steal proprietary information and a company’s intellectual property. This corporate espionage can take the form of targeted malware and phishing attacks intent on gaining entry to the environment for data exfiltration.
  • State-sponsored hackers - An organization may be attacked by state-sponsored hacker groups, depending on the market sector or industry in which they operate. In these cases, data exfiltration can pose national security risks or threaten a nation’s essential infrastructure.
  • Hacktivists - Hacktivist groups may want to exfiltrate and publicly disclose data to further a political or ideological agenda. This form of protest or activism is used by hacktivists to expose information on organizations they deem unethical or who are at odds with their ideology.

Insider threats

Insider threats also come in a wide variety of forms. Insiders pose threats that can never be eliminated due to business demands that require some individuals to have access to sensitive and confidential information

The following groups of insiders may be responsible for data exfiltration exploits.

  • Current employees and contractors - Employees and contractors with authorized access to valuable data may engage in data exfiltration for malicious purposes. This includes attempting to steal and sell information for financial gain or disgruntled employees exposing details of internal data to address a real or imagined slight. In some cases, innocent employees may make a mistake that results in a data leak or allow external threat actors into the environment by being victimized by a phishing or other social engineering attack.
  • Individuals leaving the organization - Employees leaving the company who have had access to valuable information may be tempted to exfiltrate data on their way out the door. The theft might be for personal gain, to use in a new job, or simply to demonstrate displeasure with their former employer.
  • Service providers and third-party vendors - The access afforded to service providers or vendors may enable them to perform data exfiltration for financial gain. Unlike disgruntled employees, these entities typically disclose data to make a profit rather than a point.
  • Well intentioned, but naive insiders - Well-intentioned insiders, driven by a desire to streamline processes or enhance productivity, can inadvertently open companies up to data exfiltration through their actions. Their initiatives, while aimed at improving operational efficiencies or employee satisfaction, may involve bypassing established security protocols or implementing unauthorized software solutions that lack robust security measures. This disregard for formal security guidelines, although not malicious in intent, creates vulnerabilities within the organization's IT infrastructure. What begins as an attempt to contribute positively to the organization can end up facilitating data breaches, compromising not only the company's data integrity but also its reputation and financial standing.

The diversity of external and internal threat actors posing a risk of data exfiltration complicates efforts to identify them and implement the necessary cybersecurity measures to protect organizational information. These complications are exacerbated when considering the multiple methods that can be used to exfiltrate data from an IT environment.

Me‎thods of data exfiltration

Fingers pinching the word "password" from a binary code graphic

‎‎Threat actors employ many devious methods when attempting to steal an organization’s data. Some of them involve simple criminal acts while others involve sophisticated planning and execution. 

The following are some of the most common methods and techniques used to maliciously exfiltrate data.

Physical data exfiltration

Threat actors who gain physical access to an organization’s systems or data center can use several methods to steal information and physically remove it from the premises. These techniques include:

Malware-based exfiltration

Data exfiltration can be accomplished using various forms of malware. The following are some of the types of malware used to steal valuable data.

  • Keyloggers and spyware are used to capture sensitive data from user activity. Data is then sent offsite to remote servers controlled by the threat actors.
  • Modern ransomware variants often include a data exfiltration payload designed to steal information before it is encrypted by the malware.
  • Advanced persistent threats (APTs) are often initiated with an eye toward data exfiltration. This type of malware takes up residence in an infected system or network and surreptitiously searches for valuable targets. When valuable data is located, it may be exfiltrated out of the environment.
  • Remote Access Trojans (RATs) enable hackers to remotely control infected systems and exfiltrate data.

Network-based exfiltration

Threat actors may take advantage of network security vulnerabilities or characteristics to exfiltrate an organization’s information. 

The following are some examples of this type of exfiltration.

  • TCP/HTTPS tunneling can be used to encapsulate data and transmit it over selected channels to bypass security controls.
  • Attackers may use DNS tunneling to encode data within DNS queries and replies to escape detection by traditional cybersecurity measures.
  • Ineffective email monitoring may enable threat actors to simply attach sensitive files to emails and send them to the recipient of their choice.
  • Vulnerabilities in file transfer protocols may allow threat actors to transfer data at will.
  • Cloud resources may be used by attackers to store sensitive data in compromised accounts which can then be used to exfiltrate the information to external servers.

Social engineering attacks

‎Employees must be careful not to fall victim to phishing or other forms of social engineering attacks. Threat actors use social engineering to obtain login credentials to sensitive systems or data sets that can then be used to steal data from the organization.

Steganography

This exploit involves concealing information by embedding sensitive data in benign files such as images or documents. These items can then be transferred out of the environment without triggering security alerts.

Organizations need to be aware of and protect themselves from these forms of data exfiltration. In some cases, sophisticated threat actors may gradually exfiltrate small volumes of data to avoid detection, and once a certain threshold is reached, the collected data will be sent offsite to systems controlled by the attackers.

Ex‎filtration and the MITRE ATT&CK Framework

MITRE's ATT&CK framework serves as a comprehensive matrix of tactics and techniques used by adversaries to compromise and exploit information systems. Exfiltration, as described within this framework, is a critical stage in the cyber attack lifecycle where attackers extract sensitive data from a target network to locations they control. MITRE categorizes exfiltration under the "Exfiltration" tactic, highlighting various techniques that adversaries employ to stealthily remove data without detection. This includes methods such as transferring data over the network, automated exfiltration, and even physical means for removing data. The ATT&CK framework provides detailed insights into each technique, including observable behaviors that can help defenders identify and mitigate potential data exfiltration attempts. By outlining specific methods used in exfiltration, MITRE enables organizations to better understand attacker methodologies, thereby enhancing their defensive strategies to protect sensitive information effectively.

Wa‎rning signs of potential data exfiltration

Employee working at a computer with a data breach notification warning

‎Organizations may become aware of data exfiltration attempts by the presence of multiple warning signs. The following are some of the common indicators of data exfiltration attempts.

  • Abnormal data transfers - Exfiltration is often performed overnight or during periods of low network activity. Large file transfers occurring at storage times may indicate threat actors at work and warrant an investigation.
  • Unusual network traffic patterns - Anomalous outbound data transfers to suspicious destinations may be a sign of data exfiltration.
  • Unauthorized attempts to access restricted data - Repeated attempts by unauthorized users or devices to access sensitive data may indicate the presence of insiders attempting to exfiltrate valuable information.
  • Excessive copying of sensitive information - Threat actors may be methodically collecting the data they intend to exfiltrate.
  • Transferring data to unapproved cloud storage - Malicious entities may use unapproved cloud services and shadow IT to store and exfiltrate corporate data.
  • Attempts to conceal data - Encrypting data that is not usually encrypted, or using steganography, can hide sensitive information and prevent detection by cybersecurity solutions.
  • Alerts generated by software solutions - Intrusion Detection Systems (IDS) and Data Loss Prevention (DLP) software tools monitor data at rest, in motion, and in use to identify suspicious behavior. These solutions generate alerts when anomalous activity is detected, which may indicate attempts at data exfiltration.
  • Degraded system performance - Data exfiltration activities may degrade system performance by consuming excessive resources. This can lead to unexplained issues with performance that can be hard to isolate.

De‎tecting and preventing data exfiltration attempts

Person at a computer with an access denied notification

‎Detecting and preventing data exfiltration attempts requires a comprehensive approach that includes cybersecurity measures, efficient monitoring solutions, user awareness training, and implementing strong technical controls. 

Many of the techniques used to detect data exfiltration leverage the same solutions to offer protection for an organization’s valuable data.

The following protective measures should be implemented by organizations that value their data and want to minimize the risks of data exfiltration by external and internal threat actors.

  • Identify and categorize data - It's important to understand an organization's data resources and where they reside throughout the infrastructure. While traditional methods include inventorying and classifying data as a first step, modern solutions like the Reveal Platform by Next detect and classify data as it's being used, eliminating this time-consuming step.
  • Develop data handling policies - A comprehensive data handling policy regulates the use of data. Determine how different types of data should be handled based on its sensitivity, who is authorized to access certain data resources, and how it can be used. Violations of the policy can be monitored and addressed to prevent data exfiltration.
  • Enforce strong authentication procedures - Strong authentication procedures need to be in place to ensure unauthorized users cannot gain access to confidential data. The use of multi-factor authentication (MFA) strengthens security and minimizes the possibility of data being exfiltrated by threat actors with compromised credentials.
  • Implement a Data Loss Prevention (DLP) solution - A DLP platform automatically enforces the organization’s data handling policy and restricts users from mishandling information. DLP solutions detect violations that may indicate exfiltration attempts and simultaneously prevent potentially dangerous activity. As mentioned, modern DLP solutions have the ability to detect and classify data as it's being used, allowing companies to effectively monitor all data throughout the organization's network.
  • Monitor and control network traffic - Network traffic should be monitored to identify suspicious behavior or changes in data transfer patterns. Firewalls should be implemented to keep known threats out of the environment. Intrusion detection and prevention systems can further protect the network from unwelcome visitors.
  • Deploy an Endpoint Detection and Response (EDR) solution - An EDR tool monitors endpoints for signs of data exfiltration, such as unauthorized attempts to access data and the use of potentially malicious processes.
  • Provide and promote user education and awareness - Cybersecurity education and awareness are essential ingredients in efforts to mitigate data exfiltration. Users need to understand their role in protecting company data and be educated on the phishing and social engineering attacks they may face.
  • Employ User and Entity Behavior Analytics (UEBA) software - A UEBA platform analyzes user behavior to identify aberrant activity that may indicate an internal threat. Studying the results obtained from a UEBA solution can help recognize potential insider threats so they can be addressed before data is exfiltrated.
  • Perform file integrity monitoring - Monitoring file integrity alerts an organization when changes are made to sensitive data. This, in turn, may indicate attempts to gain unauthorized access and perhaps exfiltrate the modified files.
  • Develop incident response plans - Organizations should have incident response plans in place that address all high-value and sensitive data assets. Protocols and procedures should immediately address attempts at data exfiltration and mitigate their effects.
  • Regularly perform security assessments - Regular security assessments should be conducted to search for vulnerabilities and areas for improvement. Cybersecurity must keep pace with the evolving threat landscape.

Best practices indicate that a combination of the preceding solutions is necessary to mitigate the threat of data exfiltration.

De‎ploying an effective DLP solution to address data exfiltration

‎The Reveal Platform by Next offers users an advanced DLP solution that can be instrumental in minimizing the risks associated with data exfiltration. Reveal performs multiple functions that detect and prevent data exfiltration attempts while promoting education regarding the secure handling of data resources. 

Reveal’s impressive feature set includes all the following benefits.

  • Automated enforcement of data handling policies ensures exfiltration attempts are prevented.
  • Machine learning-powered endpoint agents enforce data handling policies when data is ingested into the environment.
  • User training at the point of risk emphasizes the organization’s data handling policy when prohibiting a restricted activity.
  • Reveal employs multiple behavioral analytics algorithms to define typical versus anomalous behavior to provide data protection that does not require connection to a separate analysis engine.

Schedule a free demo to discover how Reveal enhances information security and prevents data exfiltration or contact us today to learn more.

Fr‎equently asked questions

What is the single most effective software solution to prevent data exfiltration?

A data loss prevention solution is the most effective piece of software to prevent data exfiltration. The automated enforcement of an organization’s data handling policy restricts the unauthorized use of data resources. This includes prohibiting sensitive or high-value data, as defined by the data handling policy, from being transmitted out of the environment.

What are the signs of an advanced persistent threat (APT) in the environment?

Indicators that an environment is infected with an advanced persistent threat may take several forms. For example, the malware may try to move laterally through the infrastructure in search of high-value targets. The APT may also periodically transmit outbound data to unknown destinations at suspicious times while trying to remain undetected for an extended time.

Why do ransomware attacks often include data exfiltration activities?

The goal of a ransomware attack is to extort the victim and convince them to pay a financial ransom to regain access to their encrypted data. Exfiltrating the data and threatening to disclose it or use it for other nefarious purposes is meant to give the victim further incentive to pay the ransom.

Demo

See how Next protects your employees and prevents data loss