Moves to combat rising extortion threat

Aon Crisis Management, a unit of global risk broker, has hired the former senior investigating officer for multinational extortion at the British police to head up a new extortion consulting team.

This is in response to a rapid rise in the number of commercial extortion cases in the UK, said the broker.

Sam Nicholls joins Aon after 32 years with the major crime arena of the police. During this time he rose to become the national coordinator of operations for domestic extremism.

The past few years have seen a rapid rise in commercial extortion activity in the UK, according to Nicholls. He said: ‘Between 2003 and 2006, there was an average of 23 cases reported each year. In 2007, that figure hit 40. In the past 12 months, there have been 67 recorded incidents.’

In reality, however, the number of incidents is likely to be much higher, said Nicholls. “There are no hard and fast figures of course, but it is believed a substantial number of commercial extortion cases go unreported.’

“Companies want to avoid publicity and potential damage to their brand or reputation. Many will pay extortion demands to try and get rid of the problem quickly, though this approach often doesn’t solve the problem. Once an extortionist knows a firm will pay out they are likely to target that company again in the future’

Craig Preston, director of crisis consulting at Aon, warns that you can’t predict where an attack might come from. ‘Extortionists may be terrorists, extremists, an organised crime group, a disgruntled employee seeking retribution or even a competitor trying to gain a greater market share. Common tactics include the threat to contaminate a product, bring down an online trading platform, harm personnel, reveal proprietary information or release customer data, such as bank account details – extortion can take many forms.’

According to Nicholls forward planning is the key. ‘Companies should identify a response team, involving the right people with the right skill sets, and ensure that all the predictable decisions are made before something happens. A live crisis makes a very poor learning environment, and the correct response can make the difference between successfully managing the threat and serious damage to your brand and reputation.’

Nicholls also warns of a common misunderstanding about the role of the police in an extortion incident. ‘There has to be a degree of reality in terms of the police’s role. They will proffer advice and guidance, but they will not take over and tell a company what to do. Decision making stays with the company – as do the consequences of those decisions.’