14
Apr
2010
Social Networking Extortion, The New Threat
Just like the rest of cyberspace, cyber extortion is taking some new turns into social networking. Just last week a man in Chino, CA was charged with extortion after he allededly threatened to send millions of emails and social networking messages that maligned a large life insurance company unless he was paid almost $200,000. It seems that through a series of emails and web postings, he allegedly warned employees, executives and a board member of the insurance ompany that their reputation would be ruined if his demands were not met. According to the prosecutors in the case, the defendant threatened to spam more than 6M people with links to a website that was highly critical of the various financial products offered by the insurance company. The defendant also allegedly described himself as a “huge social networker” who would use his contacts to send more than 200,000 people messages. It seems the defendants threats were due to his unhappiness related to the performance of his life insurance.
Cyber Liability and comprehensive Technology Errors & Omissions policies can include coverage for “cyber extortion” claims. This coverage is either included at the full policy limit or can be subject to a lessor sub-limit. We’ve not seen very many cyber extortion cases among our client base, however with the social networking world playing a bigger and bigger part of business reputation, we expect this type of case to be on the rise. Take a moment to consider how you might be at risk.
