The essentials for safer file transfer: Real risks and proven solutions

The importance of secure file transfer systems today cannot be overstated. With sensitive data such as personally identifiable information (PII), financial records and intellectual property flowing between systems, file transfer environments are a prime target for cybercriminals. 

Or, at least, that’s what you’re told. For example, Verizon’s 2024 Data Breach Investigation Report states, “If [ransomware actors’] preference for file transfer platforms continues, this should serve as a caution for those vendors to check their code very closely for common vulnerabilities.”

But is the need for heightened security justified? Or is it overhyped?

We’ll delve into the real risks facing file transfer environments, drawing insights from real-world breaches, attack vectors and consequences. We’ll demonstrate why comprehensive security measures are a must — not just marketing fluff.

Tangible costs of file transfer breaches

Every day, enterprises like yours process thousands of files containing valuable and often sensitive data. Cybercriminals are acutely aware of this, and file transfer systems have become frequent targets for attacks. High-profile breaches over the past few years underline the stakes.

For example, one breach compromised hundreds of thousands of individual records, while another saw tens of millions of files leaked. These incidents not only cause financial losses but also trigger regulatory scrutiny, lawsuits and reputational damage.

Financial impact

According to the 2024 Ponemon/IBM Cost of a Data Breach Report, the average cost of a data breach has surged to $4.88 million — a 10% increase from last year. Breaches bring immediate costs, such as containment and remediation, as well as long-term expenses like regulatory fines, legal fees and credit monitoring services for affected individuals.

Reputation damage

For industries like healthcare or finance, public disclosure is often mandatory, amplifying the reputational fallout. Customers and partners may lose trust, while businesses scramble to manage the narrative. The ripple effects of a breach can last for years, impacting customer retention and revenue.

Top threats to file transfer environments

Understanding the most prevalent threats is key to implementing effective defenses. Here are three major attack vectors that put file transfers at risk.

1. Zero-day exploits

Zero-day vulnerabilities are software flaws unknown to the vendor that leave systems exposed until a patch is released. Cybercriminals can exploit these gaps to infiltrate file transfer systems, often before the organization is even aware of the threat.

Mitigation tips:

• Choose vendors who conduct regular penetration testing to proactively identify vulnerabilities.
• Ensure your provider has a robust response plan for addressing zero-day threats.

2. Credential theft

Credential theft remains the top initial attack vector, as reported in the aforementioned 2024 Cost of a Data Breach Report. Cybercriminals use tactics like phishing, keylogging and social engineering to obtain user credentials, gaining unauthorized access to file transfer systems.

Mitigation tips:

• Implement multi-factor authentication (MFA) to add a layer of security.
• Train employees to recognize phishing attempts and other forms of social engineering.
• Enforce regular password rotation policies to minimize risk from stolen credentials.

3. Man-in-the-middle (MITM) attacks

In a MITM attack, threat actors intercept file transfer connections to steal sensitive data or credentials. Unencrypted file transfer protocols, such as FTP, are particularly vulnerable to these types of attacks.

Mitigation tips:

• Transition to encrypted protocols like secure file transfer protocol (SFTP), file transfer protocol secure (FTPS) or HTTPS.
• Use strong encryption standards to secure file transfers end to end.

MFT security features — Essential, not excessive

Critics may argue that MFT solutions are overengineered for security. However, the data suggests otherwise. Real-world breaches and evolving threats justify the need for advanced security measures. Here are a few features that set robust MFT solutions apart.

• Audit trails and monitoring: Comprehensive logging and monitoring help organizations detect anomalies and maintain compliance with regulations.
• Automated compliance features: Leading MFT solutions offer built-in compliance with standards like GDPR, HIPAA and PCI-DSS, reducing the burden on IT teams while ensuring legal protection.
• End-to-end encryption: Encryption ensures that files remain secure during transfer and at rest, rendering them useless to unauthorized parties.
• Granular access controls: Role-based permissions restrict access to sensitive data and minimize the risk of internal threats or accidental exposure.

An MFT solution is even more effective when it’s seamlessly integrated with a powerful workload automation platform. Explore the benefits of pairing RunMyJobs by Redwood and JSCAPE by Redwood.

Proactive steps to secure file transfers

Ensuring safe file transfers requires a combination of robust tools and disciplined practices. MFT solutions provide the foundation for secure and efficient data movement, but a proactive strategy is essential for mitigating risks and ensuring long-term data protection. Fortify your file transfer environments while leveraging best practices in automation and security.

Implement automation for data transfer workflows

Manual processes are inherently prone to human error, delays and inconsistencies — especially when sharing large files or managing high-volume data transfer tasks. Automating file transfer workflows eliminates these vulnerabilities by standardizing processes and reducing reliance on manual intervention. Automation ensures consistent use of encryption protocols, scheduled transfers and compliance checks, helping you maintain a secure and streamlined file transfer system.

Automated systems also provide detailed audit logs, making it easier to monitor data transfer activities and detect indicators of a breach. These logs are crucial for both security and compliance, as they provide a transparent view of every file shared, accessed or modified within the system.

Strengthen password protection policies

Credential theft remains a leading attack vector for breaches, making password protection a non-negotiable. A robust password policy should enforce complex password requirements and regular password rotation to minimize exposure to attacks. However, traditional password systems alone are not sufficient. You should integrate multi-factor authentication (MFA) to provide an additional layer of protection so that even if credentials are compromised, you prevent unauthorized access.

Coupled with role-based access controls (RBAC), strong password protection policies limit access to sensitive data, allowing only authorized users to share files or manage data transfers. These measures collectively minimize the risk of unauthorized access to critical systems.

Protect large files with end-to-end encryption

Large files often carry valuable or sensitive information, making them an attractive target for cybercriminals. Encrypting files during transfer and at rest is critical for safeguarding data from interception or unauthorized access. Modern MFT solutions offer end-to-end encryption for all file sizes, ensuring that data remains protected throughout its journey.

Encryption protocols such as SFTP, FTPS and HTTPS provide a secure channel for transferring files, while advanced cryptographic standards.

Safe file transfers require proactive measures

The risks to file transfer systems are real and growing, as evidenced by high-profile breaches and sophisticated attack vectors. Far from being overkill, the robust security features offered by MFT solutions are vital for protecting sensitive data and maintaining business continuity.

To ensure your organization’s file transfers are as secure as possible, invest in an MFT solution that prioritizes encryption, compliance and advanced threat detection. You’ll avoid the devastating consequences of a breach and confidently safeguard your most valuable data.

Learn how to assess your current file transfer risks and select a secure MFT provider: Download JSCAPE’s latest guide.