How Financial Institutions Can Proactively Stop Ransomware & Extortion Attacks

The ransomware threat to financial services and insurance institutions has not stopped growing over the years. Reports by Statista show that in 2024, around 65% of financial organizations experienced a ransomware attack, compared to 64% in 2023 and 34% in 2021. But Ransomware actors are consistently evolving, with ransomware-as-a-service proliferating, whereby bad actors offer ransomware tools for a fee or as a portion of the illegal proceeds. This lets threat actors rent the services they need rather than having to develop their own tools or software, allowing them to increase the volume of the attacks.

The Ransomware Threats Financial Services Need To Prepare For

Ransomware on Banking IT Infrastructure

Attacks like DarkSide and LockBit lock financial databases, demanding payment for decryption. The LockBit ransomware operation is an example of a Ransomware-as-a-Service (RaaS) model, where affiliates are recruited to conduct ransomware attacks using LockBit ransomware tools and infrastructure. 

Since January 2020, affiliates using LockBit have attacked organizations of varying sizes across an array of industries, including some high profile financial and banking organizations like Venezuela’s largest bank and Albany bank in Chicago. According to the UK’s National Crime Agency, the group launched more than 7,000 attacks globally between June 2022 and February 2024, before its leader Dmitry Khoroshev was unmasked and sanctioned. However, other groups have just filled the gap. 

Due to the large number of unconnected affiliates in the operation, LockBit ransomware attacks, and others like it, vary significantly in their tactics and techniques, presenting a notable challenge for organizations working to maintain network security and protect against a ransomware threat.

Insurance & Actuarial Data Theft

Cybercriminals steal policyholder information and claims data, threatening to sell it unless a ransom is paid. The potential theft of sensitive data, as well as phishing and ransomware attacks, pose the greatest global threat to the insurance sector, according to research from PwC and CSFI. 

There have been a number of high-profile breaches impacting Insurers, including Landmark Admin, which experienced a cyberattack in May 2024. The incident exposed the personal information of over 800,000 individuals including names, Social Security numbers, driver’s license numbers, passport numbers, tax IDs, bank details, medical information, health insurance policy numbers, and even life and annuity policy details. All this gave cybercriminals the tools to engage in identity theft or fraud on a massive scale. 

Allianz Life was also hit this year when a threat actor, thought to be a collaboration between Scattered Spider and ShinyHunters, targeted a third-party customer relationship management (CRM) system and obtained the information of a majority of customers, financial professionals, and some employees. 

Targeted Extortion of Crypto Exchanges

Ransomware groups threaten to expose private keys or smart contract vulnerabilities in exchange for payments. The Kroll Cyber Threat Intelligence team observed that nearly $1.93 billion was stolen in crypto-related crimes in the first half of 2025 alone, surpassing the total for 2024 and putting 2025 on track to be the worst year for digital asset theft. Additionally, phishing attacks targeting cryptocurrency users increased by 40%, primarily through fake exchange sites. 

The most recent high-profile breach in this space was Coinbase’s, which, despite not paying the $20 million ransom, the company estimated would cost them between $180m and $400m.

All this highlights the growing cybersecurity risks in the crypto space, from direct thefts and hacks to more sophisticated scams and laundering operations. 

Stay Ahead of Ransomware and Extortion Attacks With a Cyber Range Approach

Ransomware operators are combining encryption with data theft and extortion. Attackers know that downtime, reputational damage, and regulatory exposure can have immediate market impact, making the sector particularly vulnerable to pressure tactics. FS-ISAC’s latest Navigating Cyber report stresses the importance of forward-looking resilience, emphasizing proactive threat modeling, agile defense, and cross-border collaboration.

One way financial institutions are preparing for current and future threats is with a cyber range: a simulated production environment that mirrors core banking, trading, and payment systems, allowing firms to model ransomware and extortion scenarios without exposing live operations.

Unlike static tabletop drills or generic resilience testing, cyber ranges offer continuous, high-fidelity training in realistic environments. Modern financial cyber ranges are:

• Dynamic and Scalable: Capable of replicating complex environments such as core banking platforms, ATMs, SWIFT connectivity, and cloud-based services, updated with live threat intelligence.
• Customizable: Tailored to reflect each institution’s unique infrastructure and risk profile.
• Advanced in Threat Simulation: Featuring end-to-end ransomware campaigns, including phishing-based delivery, lateral movement, data exfiltration, and multi-stage extortion tactics.

How Does it Work?

Providers work with firms to design a cyber range that mirrors their real-world systems, whether that’s payment processing, Windows and Linux servers, or security monitoring tools like EDR and SIEM. Within this environment, red, blue, and purple teams can safely trigger ransomware-style attacks and practice coordinated responses.

Exercises can test everything from early detection and rapid containment through to crisis communications, regulator engagement, and recovery workflows. SOC managers and incident response leads gain the ability to assign specific training to teams based on their role in the kill chain.

Throughout the process, firms capture actionable performance metrics such as time-to-detection, number of endpoints recovered, containment speed, and financial/reputational risk exposure. These insights not only validate resilience strategies but also highlight where investments in detection engineering, backup policies, or cross-border coordination will deliver the greatest impact.

By training against ransomware and extortion in environments that replicate real-world financial operations, firms ensure their defenses, teams, and playbooks remain prepared for the evolving threat landscape.

Finding a Cyber Range to Combat Ransomware 

The rise of ransomware and multi-stage extortion attacks has created new risks for financial institutions: downtime of critical systems, data exfiltration with regulatory exposure, and reputational damage that can trigger market instability. Preventing these outcomes requires cyber ranges that go beyond traditional tabletop exercises. Here’s what financial services CISOs should look for:

• Realistic replica of production environments: Your cyber range should replicate core banking platforms, payment systems, trading infrastructure, and customer-facing applications. Scenarios must include full ransomware attack chains – phishing entry points, privilege escalation, lateral movement, encryption, and data theft – so teams can practice responses under conditions that mirror real-world pressure.
• Integrated tools: Ensure the range integrates with your existing EDR, SIEM, backup, and recovery platforms. You need to validate whether your detection stack can spot early indicators of compromise, block lateral movement, and assess how backup and restore processes perform during encryption or extortion attempts.
• Dynamic attack and activity emulation: Ransomware groups continually adapt their tactics. Look for ranges that simulate both commodity ransomware strains and sophisticated targeted campaigns, with real-time variations in attack paths, covering double and triple extortion, data leaks, and destructive “wiper” scenarios.
• OT/Hardware-in-Loop: Many financial services operations rely on ATMs, payment kiosks, and other hardware. A capable range should emulate these systems as well, testing resilience against ransomware campaigns that target both digital and physical endpoints.
• Deployment options: Financial services infrastructures often span on-premises data centers, cloud services, and hybrid environments. Your range must support testing across these integration points, ensuring vulnerabilities in cross-border operations, vendor interconnections, and third-party services aren’t overlooked.
• Individual, Team, and AI Agent Training and Assessments: Cyber ranges should provide role-specific scenarios for SOC analysts, fraud teams, incident responders, crisis managers, and executives. Training should cover ransomware detection, negotiation protocols, regulatory escalation, and customer communication in the financial context.
• Live scoring and reporting: Reporting should surface detection and containment times, recovery effectiveness, and data protection outcomes. Executive dashboards should translate these results into business impact, including financial losses avoided, regulatory compliance (e.g., FCA, SEC, or GDPR obligations), and effects on customer trust and market stability.

Preparing for Inevitable Threats

Ransomware is the number one threat for most businesses, with hundreds of organizations having been targeted and affected in recent years from government entities to small players within a wider supply chain. Preparing for ransomware attackers needs to be the number one priority, as organizations have no excuse not to understand the seriousness of the threat. A cyber range has a plethora of real-world ransomware attacks to draw to test how your people, processes, and technology would stack up against an attempt from today’s highly sophisticated and coordinated ransomware gangs using the tactics and techniques they’ve already successfully used to breach organizations. 

To see what a SimSpace cyber range looks like for your financial institution, schedule a demo with SimSpace today.