Commercial Awareness Update – W/C 17th May 2021

The round-up of the stories that a budding Student Lawyer should be aware of this week. Sign up here to get these updates in your inbox every week.

Influencer Marketing and the Impact on Businesses

Article by Simone Forostkenko (5th year BCrim/LLB student at University of New England)

Social media influencers have revolutionised the way businesses market their products. Using influencing to market a brand involves collaborating with an individual’s online platform and presence to mention and endorse the brand. The more followers an influencer has, the more publicity a brand can gain.

Influencers have the ability to earn large sums of money by marketing other businesses brands. An influencer with a minimum following of 5,000 people on Instagram can earn £250 per post. A influencer with over 10,000 followers can earn over £2,750 per post. With the amount of money individuals can earn, it is important that influencers and brands following the Advertising Standard Authority’s (ASA) regulations.

The ASA is the United Kingdom’s independent regulator of advertising who monitor influencers and brands to ensure they comply with regulations. These regulations include ensuring consumers are aware that an influencer is posting a brands content by hash tagging #sponsored or #ad on their posts.  The ASA has made it clear that if their guidelines are not complied with, the influencer and brand will be held equally responsible for the breach. The penalties for brands and influencers not complying with ASA regulations includes: withdrawal or amendment of the offending ad, naming and shaming the brand and/or influencer on their non-compliant list and disqualification from industry awards.

The impact that these penalties can have on a brand and an influencers brand can be extremely detrimental. The penalty can give a business a negative reputation and makes future marketing with less effective. For an influencers brand, it can affect other businesses from wanting to work with them as the do not want to also be at risk for breaching the ASA’s regulations.

For more information on ASA’s influencers regulations, please click here.

A Crisis for US Cybersecurity in the Pipeline

Article by Andrew Dewey (3rd yr LLB student at Reading University)

The Facts 

On 7^th May 2021, the FBI was notified of a cybersecurity assault which ceased the operation of the 5,500-mile Colonial Pipeline which carries up to 100 million gallons of petrol, diesel and jet fuel per day between Texas and New York – amounting to approximately 45% of the fuel consumed on the East Coast. It was reported that 100 gigabytes were stolen which resulted in the Colonial Pipeline Company shutting down a large portion of its operations.

The hack was caused by the use of ransomware, initiated here by a group called ‘Darkside’, whereby hackers seize control of a computer system and its data and only release the content held once a payment has been made. Despite announcing that they did not intend to pay any ransom, it has emerged that Colonial has now paid at least $5 million for software to decrypt its computers.

This event comes only one year after the last major cybersecurity attack to take place in the US. In 2020, the American software development company SolarWinds became a victim of cyber hacking when Russian criminals forced access into the US Treasury departments and thousands of other agencies.

Political implications of the Attack

With a surge in these attacks occurring over recent years, which are normally targeted at high profile IT systems, this surge is thought to be linked with hackers making more use of cryptocurrencies to receive extortion payments without being tracked. By being labelled as the final wake-up call for the US, this calls for immediate action to be taken by the Biden Administration in order to deter these criminals – particularly with the rise in the use of cryptocurrencies such as Bitcoin and Dogecoin in the last months. Energy experts have come forward and announced that the US’ energy infrastructure is increasingly under threat from Russian and Chinese hackers, and this is particularly worrying because the hackers could be state backed.

Although President Biden has announced that he will be looking into the implications of this incident, it is thought by Colonial officials that it will take days for markets, operations and the supply chain to return to normal. That said, the President has already signed an emergency executive order for the purpose of strengthening US cybersecurity. However, the order is not as clear in regard to preventing such attacks, the order does include the creation of a Cyber Security Safety Review Board which will be on hand to convene after any future incidents and work out how to rectify it.

Further Implications 

Given that 70% of gas stations in North Carolina were without fuel and a further 50% of stations in Virginia, South Carolina and Georgia having outages, gasoline prices rose to $3.00 a gallon – a record high since October 2014. The issue was heightened further by multiple motorists deciding to panic buy fuel at the few stations which had enough supply. As a result, federal regulators decided to waive restrictions on import vessels to increase the speed of deliveries.

As the pipeline begins to return to normal and supplies reach their normal level, perhaps this really is the final straw for the US to tighten its cybersecurity as well as its fragile infrastructure across the country. Failure to do this will only give rise to further attacks down the line.