LandMark White in trading halt as banks head for the exits
Written on the 5 June 2019 by David Simmons
Property valuer LandMark White (ASX: LMW) is in a trading halt while it works out how to deal with being suspended by major clients following the group's second data breach this year.
The group announced on Tuesday evening that three of the four major banks, plus other financial institutions, have temporarily suspended instructions to LMW.
The full list of clients includes Commonwealth Bank (ASX: CBA), ANZ (ASX: ANZ), National Australia Bank (ASX: NAB), Bankwest, Bendigo & Adelaide Bank (ASX: BEN), Suncorp (ASX: SUN), HSBC, and Latrobe.
This is yet another major development for the property valuer which only recently emerged from an ASX suspension at the beginning of May, in the wake of a cyber-attack that saw customer information published on the dark web.
The company says loss of revenue from being suspended for the second time this year by major financial institutions will have a "material impact" on performance, although the dollar amount cannot be accurately quantified at this point in time.
The group says it requested a trading halt so it can work with clients on a timeline for lifting the suspensions.
This latest data breach is the second in the last six months for the company.
The group says company documents were posted to US file sharing platform SCRIBD on Wednesday 29 May 2019 by an individual known to LandMark White. The valuer first notified the market and clients on the night of 30 May 2019.
Unlike the first attack, which saw personal details of clients revealed on the dark web, this latest attack seems to be less confidential in nature.
Nonetheless, the company is taking the matter very seriously and has reported the incident to New South Wales police.
LandMark White has refused to characterise the data breach as a cyber-attack, rather suggesting it is "the deliberate acts of a person known to LMW".
"LMW suspects that this person has taken the documents from LMW via a manual process and is attempting to damage LMW's brand and reputation," says LandMark White in an ASX statement.
"There is absolutely no indication that the person is attempting to derive personal gain from the disclosure."
This latest data beach comes just four months after the group was suspended from trading on the ASX because of a large-scale cyber-attack which saw company documents hosted on the dark web for 10 days before being noticed.
The company only just returned to the ASX at the beginning of May and revealed that the cost of that incident would hit the group's revenue by $7 million.
This loss of revenue does not account for the "significant" cost of upgrading the group's cyber security measures.
The company emphasised it was returning with a system with significantly enhanced digital security measures, and it is working towards achieving ISO27001 (International Information Security Standard) certification in the meantime.
"This latest release of documents does not, in any way, reverse the conclusions reached with respect to LMW's security environment and accordingly we do not believe that it is necessary for banks to re-suspend LMW," says LandMark White.
"If the perpetrator is allowed to succeed in their efforts to damage LMW's brand and reputation, this will have implications for the wider valuation industry's viability. Further, if the approach of dumping internal documents on the web successfully damages LMW, its employees and shareholders, it opens an avenue for disgruntled employees of other organisations to do the same. This activity must be deterred, and we thank the wider community for its support to stamp this activity out."
Shares in LMW are down 12.20 per cent to $0.18 per share at 4.10pm AEST.
Business News Australia
Author: David Simmons