What is Cyber Extortion? Types, Examples & Prevention

Cyber extortion is becoming an increasingly common form of cybercrime. According to a report by Cybersecurity Ventures, global damages from ransomware attacks are expected to surpass $30 billion annually by the end of 2025. This highlights the growing threat that ransomware poses to businesses and individuals alike.

Cyber extortion is a serious threat that impacts everyone, from individuals to small businesses and large corporations. These attacks can lead to stolen data, locked systems, and difficult decisions for those affected. Cybercriminals are becoming more aggressive in finding and exploiting vulnerabilities as technology advances. In this blog, we will explore cyber extortion and share real-life examples to illustrate how serious and dangerous this issue can be.

What Is Cyber Extortion?

Cyber extortion occurs when criminals use the internet to threaten individuals or businesses by making them pay money. They might say they’ll release sensitive information, disrupt services, or damage systems if their demands aren’t met. Often, victims feel pressured to pay up to prevent harm, fearing public embarrassment. Cyber extortion is a serious issue that puts innocent people in challenging situations.

“Ransomware and multifaceted extortion [remain] the most disruptive form of cyber crime.”
Google Cloud Security Team
Source: Cybersecurity Forecast 2025 Report

Who Is a Cyber Extortionist?

A cyber extortionist is the person or group behind these online threats. They use various tools and techniques to gain access to digital systems. These criminals often remain anonymous, using fake identities and hidden networks. They can be lone hackers or part of larger criminal organizations. Their main goal is to make money while staying out of reach of law enforcement.

How Does Cyber Extortion Work?

The process usually starts when an attacker finds a weak spot in a system. They may break in using phishing emails, malware, or unsecured networks. How Does Cyber Extortion Work?

Here’s how it typically works:

1. Target Identification

The first step in cyber extortion involves identifying a vulnerable target. Cybercriminals often look for individuals, businesses, or organizations with weak cybersecurity measures, such as outdated software, unsecured networks, or poorly trained staff. Attackers may survey the target to gather information about its systems, operations, and data value, which helps them plan a more effective attack. Sometimes, they purchase stolen credentials or exploit leaked data to gain initial access.

2. System Infiltration

Once a target is selected, attackers infiltrate the system using various methods. Common entry points include phishing emails, malicious attachments, infected software downloads, or exploiting security vulnerabilities in operating systems. Once inside the system, the attacker may install malware that encrypts files or exfiltrates sensitive information. Attackers often remain undetected for days or weeks while they navigate the network and gain deeper access.

3. Data Encryption or Theft

After gaining access, the attacker encrypts valuable data or steals it. Ransomware is typically used to lock the victim out of their files, rendering them useless without a decryption key. Alternatively, attackers may exfiltrate sensitive data, including financial records, personal information, or trade secrets. This stolen data can later be used for double extortion, threatening to release the information publicly unless a ransom is paid.

4. Extortion Demand

Once the attacker has control, they deliver an extortion demand to the victim. This usually comes as a message or ransom note explaining what has happened, what the attackers want, and what will happen if the demands are unmet. The threat may include permanent data loss, public release of sensitive files, or further system damage. In some cases, attackers offer a deadline, after which the ransom amount increases or the consequences worsen.

5. Negotiation and Payment

Some victims attempt to negotiate with the cybercriminals to reduce the ransom amount or buy time. However, there is no guarantee that the attacker will respond fairly. If the victim chooses to pay, they usually do so in cryptocurrency (like Bitcoin or Monero) to keep the transaction anonymous. Law enforcement agencies generally advise against paying, as it encourages further attacks and doesn’t guarantee that the stolen or encrypted data will be returned safely.

6. Aftermath and Recovery

The aftermath of cyber extortion can be severe, depending on whether or not the ransom is paid. Victims must work to remove the malware, restore backups, and investigate how the breach occurred. Data may need to be restored manually, systems rebuilt, and security policies tightened to prevent future attacks. In cases where sensitive information was leaked, there may be legal consequences, reputational damage, and customer trust issues. Recovery is often costly and time-consuming.

Types of Cyber Extortion

Cyber extortion takes many forms, and attackers continue to create new ways to exploit their victims. Each type uses different tactics, but all involve threats and demands. Below are the most common types seen today.

1. Ransomware Attacks

Ransomware is the most well-known form of cyber extortion. Attackers infect a computer system with malware that encrypts files and locks users out. Victims receive a message demanding payment, often in cryptocurrency, to get the decryption key. Some ransomware also includes a countdown timer, increasing pressure on the victim to pay quickly.

2. Data Theft and Blackmail

In this type, hackers steal sensitive or confidential data. They then contact the victim and threaten to release the information online or sell it unless a ransom is paid. Victims may include companies with customer databases, medical records, or financial files. The fear of legal issues or public backlash often pushes victims to comply.

3. Distributed Denial of Service (DDoS) Extortion

DDoS extortion involves threats to overwhelm a website or server with fake traffic. When a DDoS attack is launched, it can take down an entire website or online service. Attackers send a warning before or after a minor attack and demand payment to stop future disruptions. Online businesses, banks, and e-commerce platforms are common targets.

4. Sextortion

Sextortion is a severe form of cyber extortion that invades a person’s privacy. It often starts when attackers find intimate content, usually by hacking social media accounts or webcams. They threaten to share this material with the victim’s friends, family, or the public unless the victim pays money. Teenagers and young adults are especially at risk for this crime.

5. Email-Based Extortion Scams

Scammers often use fear to trick victims. They claim to access the victim’s browsing history or webcam footage and demand a ransom to keep this information private. Although these threats are usually fake, they can cause panic and confusion.

6. Insider Threats

Cyber extortion can come from within a company. Unhappy employees or contractors with access to essential systems might threaten to leak data if their demands aren’t met. These attacks can be harder to spot because insiders know the system well.

How to Spot Cyber Extortion?

Cyber extortion can take different forms, but there are common warning signs to watch for. Knowing these signs is the first step to keeping yourself or your organization safe.

1. Unusual or Threatening Messages

Cyber extortion begins with a suspicious message. This may arrive via email or a pop-up window. The message usually:

• Claims the attacker has locked your data
  
• Demands payment in cryptocurrency
  
• Includes a threat to release the information if you don’t comply
  

2. Locked Files 

You may face a ransomware attack if you suddenly lose access to files or systems. In this case, your screen might show a ransom note, a countdown timer, or instructions on how to make a payment. This type of extortion is direct and often leaves no doubt about what’s happening.

3. Emails That Contain Personal Information

Some attackers use scare tactics by sending emails containing real details like your name, part of a password, or IP address. These are meant to build trust and fear. The attacker might claim they’ve recorded you through your webcam or gained access to your private accounts. Even if these claims are false, they can feel genuine to the victim.

4. Website Outages Linked to Threats

If your website or online service suddenly crashes and someone contacts you demanding payment to stop the disruption, you could be experiencing a DDoS extortion attack. Sometimes, attackers perform a minor “test” attack to prove they can shut you down.

5. Personal Blackmail on Social Media

In cases of sextortion, the attacker may reach out through social media or email. They claim to have personal or intimate content and demand money to keep it private. These attacks can be emotionally distressing and are designed to pressure the victim into silence.

6. Demands for Payment with Deadlines

A clear sign of cyber extortion is a demand for money with a time limit. The attacker may threaten to increase the ransom, delete files, or leak information if payment is not made by a specific time.

How to Report Cyber Extortion?

If you become a victim of cyber extortion, reporting the crime quickly is critical. It helps stop the attacker, protects others, and may assist law enforcement in catching the criminals. Here’s how to take the proper steps.

1. Do Not Pay the Ransom

If you ever find yourself in a situation where someone is demanding a ransom, it’s important to think twice before paying. Even if the threat feels real, paying the ransom doesn’t guarantee that you’ll get your data back, and it might only put you at risk for further attacks in the future. Instead, focus on gathering any evidence of the attack and reach out to the appropriate authorities for help.

2. Preserve Evidence

Before you delete any messages or take any further steps, make sure to document everything. Save your emails, take screenshots of any ransom messages, and keep a record of file names to show that the attack happened. It’s important to note when and how your system got locked or when your data was stolen. Having this evidence is really important for investigators later on.

3. Disconnect devices

If you find that any of your devices are infected, the first thing you should do is disconnect them from the internet and your network. This is crucial for containing the attack and preventing it from spreading to other devices. If your business relies on internal servers, it’s wise to cut off access to those as well to minimize any potential damage.

4. Report to Local Law Enforcement

Contact your local police or cybercrime unit. In many countries, cyber extortion is a criminal offense and must be reported. Provide them with all the evidence you have gathered. Local authorities can work with national or international agencies to investigate the case.

5. Report to National Cybercrime Agencies

Most countries have dedicated agencies to handle cybercrime reports. You can often file a report online. Here are a few agencies:

• United States: Report to the FBI’s Internet Crime Complaint Center (IC3) at www.ic3.gov
• United Kingdom: Report to Action Fraud at www.actionfraud.police.uk
• India: Report it at cybercrime.gov.in.
• Australia: Report to the ACSC at www.cyber.gov.au.

6. Notify Your IT or Cybersecurity Team

Inform your internal IT or cybersecurity team immediately if you’re part of an organization. They can help isolate the threat, recover systems, and improve security. If you don’t have an internal team, hire a professional cybersecurity firm to help assess and respond to the attack.

7. Alert Affected Individuals or Partners

If personal or customer data has been stolen, you may be legally obligated to inform those affected. Timely communication helps people protect themselves and may prevent further damage.

Examples of Cyber Extortion 

1. Kadokawa & Niconico (Japan, June–August 2024)
   A ransomware attack by the Russian-linked BlackSuit (also known as Royal) struck Kadokawa and its video platform Niconico. 

• The group claimed responsibility and threatened to leak 1.5 TB of stolen data unless a ransom was paid. The incident disrupted services and led to a ~20% drop in Kadokawa’s stock. Around 254,241 users’ data were compromised.
  

2. Snowflake Data Breach (2024)
   At least 160 organizations, including AT&T, Ticketmaster, Santander, Advance Auto Parts, and more, suffered data theft through misconfigured Snowflake environments.
   • Stolen data reportedly included personal records and 50+ billion AT&T call logs. Extortionists demanded a ransom in exchange for not leaking that data.
     
3. LockBit Attacks (Canada & Croatia, May–June 2024)
   In May, LockBit forced Canadian retailer London Drugs to close locations. They demanded $25 million, though no customer or employee data was compromised.
   
   • In June, the University Hospital Center in Zagreb (Croatia) was hit. LockBit exfiltrated files and caused significant operational disruption “back 50 years” to manual record-keeping. The government refused to pay.
     
4. IRLeaks Attack on Iranian Banks (August–September 2024)
   In what was described as Iran’s worst-ever cyberattack, IRLeaks targeted 20 out of 29 Iranian banks.
   • The attackers demanded millions in ransom to stop the attack and recover data. Iran reportedly paid at least $3 million to avert the widespread collapse of its financial system.
     
5. Medusa Ransomware Campaign (Early 2025)
   Medusa attacked over 300 critical infrastructure organizations, including healthcare, education, government, and manufacturing.
   • They used double and even triple extortion tactics, encrypting systems, stealing data, and threatening further harm. Some ransom demands reached $15 million.
     
6. NASCAR Medusa Extortion (April 2025)
   In April 2025, NASCAR experienced a Medusa ransomware attack. Personal data, including names and Social Security numbers, was stolen.
   • The group demanded a $4 million ransom by April 19. Whether the ransom was paid remains unclear, but NASCAR launched credit monitoring for affected users.

How to Protect Your Business Against Cyber Extortion?

Cyber extortion is a growing threat to businesses of all sizes. Attackers target sensitive data, systems, and customer trust. A single breach can cause financial losses and long-term damage to your brand. Here’s how you can protect your business effectively.

1. Implement Strong Access Controls

Limit system access based on roles. Give employees only the permissions they need to do their jobs. Use strong, unique passwords and require two-factor authentication (2FA) for all logins.

2. Regularly Back Up Critical Data

Create secure backups of all critical files. Store them offline or in a protected cloud environment. Test your backups regularly to ensure they work when needed. Backups let you restore data without paying a ransom.

3. Keep All Systems Updated

Cybercriminals often exploit outdated software. To reduce risk, update operating systems, applications, plugins, and security tools regularly. Enable automatic updates where possible.

4. Train Employees on Cybersecurity

Your staff is your first line of defense. Provide regular training to help them identify phishing emails, social engineering scams, and unsafe links. Make cybersecurity part of your workplace culture.

5. Use Endpoint and Network Protection

Install antivirus, anti-malware, and endpoint detection software on all devices. Set up firewalls and intrusion prevention systems to guard your network. Monitor activity to catch threats early.

6. Secure Remote Access

Use a Virtual Private Network (VPN) for employees working remotely. Disable unnecessary remote desktop access. Strong authentication is required for any remote logins to company systems.

7. Create an Incident Response Plan

Prepare for attacks before they happen. Create a clear plan outlining who to contact, how to isolate affected systems, and how to recover data. Test the plan with your team to make sure everyone knows their role.

8. Partner with Cybersecurity Experts

If you lack in-house expertise, hire a cybersecurity firm or managed security provider. Experts can help you identify weak points, run security audits, and respond to incidents quickly.

9. Monitor for Suspicious Behavior

Use tools to track unusual activity like login attempts, file changes, or large data transfers. Early detection helps stop attacks before they cause serious harm.

Conclusion: 

Cyber extortion is no longer a rare or isolated threat. It has become a significant concern for both individuals and organizations. These attacks’ financial and emotional toll can be severe, especially when critical systems are shut down or private data is exposed. While there’s no way to guarantee complete safety, staying informed and practicing strong cybersecurity habits can significantly reduce your risk. If you ever become a victim, it’s essential to report the crime and avoid paying the ransom when possible.

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