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Copilot-Related Breaches: Do You Need an Incident Response Plan?

Josh Krodel

With the increasing adoption of AI tools like Microsoft Copilot, IT leaders are rightfully concerned about the potential for breaches within their organizations – and rightfully so. The integration of Copilot into daily operations and data handling practices often raises questions about the tool’s impact on the organization’s security posture.

Before we dive into completely, it’s important to know: Copilot does not inherently increase the threat of breach incidents happening any more than a new tool in your organization’s tech stack. However, it does marginally increase vulnerability once a breach has occurred (more on that toward the end of this article).

If you’re following best practices to mitigate breaches however, this shouldn’t be a major concern. Now let’s press on.

The security risks of Copilot

Copilot operates within the self-contained environment of a Microsoft 365 tenant, so it is fundamentally secure and compliant with Microsoft’s cloud security standards. This design minimizes the direct pathways through which external threats could gain access to sensitive data via Copilot.

In other words, breaches shouldn’t be your primary security concern with Copilot. But that isn’t to say there aren’t risks.

If a threat actor has breached your environment, Copilot can inadvertently offer threat actors a significant advantage. Since Copilot makes data extraction easier by design, in the wrong hands this allows them to quickly access sensitive information within compromised accounts. This efficiency reduces the time they spend in the system, thus minimizing their detection window and increasing the challenge for security teams to identify and respond to the intrusion promptly.

While this doesn’t increase the risk of a breach, it can increase the damage done when a breach does occur. However, there are still specific risks that organizations should be aware of and manage appropriately.

Consider how you might prepare for instances like these, from identification and containment to recovery and post-Incident analysis:

Insider threats or misuse of information

One of the primary concerns is internal, such as a scenario where disgruntled employees have access to sensitive information. These individuals could potentially misuse Copilot to extract or manipulate data for malicious purposes.

The ease of access to information provided by Copilot could exacerbate such risks, making it imperative for organizations to closely monitor and control who has access to what data. Implementing strict access controls and regularly reviewing user privileges can help mitigate the risk of data misuse by insiders.

Inadvertent data sharing

Another risk comes from well-intentioned, but potentially careless, actions by employees. For example, a user might inadvertently share a folder containing sensitive information via OneDrive, thinking they are sharing a single file. Copilot, with its broad access to organizational data for facilitating queries and tasks, could amplify the consequences of such mistakes.

This highlights the need for user education on secure data sharing practices. At very least, training should emphasize the importance of double-checking the data being shared and understanding the tools’ sharing settings to prevent accidental data exposure.

Preparing for a Copilot-related breach

An incident response plan is important for any breach, but you should still factor in how you might respond differently with a Copilot-related incident. You will want to ensure rapid detection and mitigation of any threats, as addressing these vulnerabilities can safeguard your organization against significant security incidents.

Given the relatively new status of Copilot, there are inevitably going to be some kinks that need to be worked out. As more users integrate Copilot into their daily workflows, new vulnerabilities or issues may surface. As these arise, you can expect Microsoft will address them with regular updates and patches, ensuring users can maintain a high level of security as the tool evolves. If you’d like to learn more, Microsoft provides a ton of knowledge about the secure usage of Copilot.

Preparing for potential breaches means understanding the ins and outs of your security, from sensitivity labels and document storage to spotting risks before they become problems. By educating your teams—not just IT professionals and management, but also knowledge workers—you can reduce a major area of risk.

6 Ways You Can Mitigate Risks with Copilot and other AI tools

To better prevent and prepare for security risks, we help organizations to:

  • Define sensitive data, pinpointing what needs the highest level of protection.
  • Understand data flow, tracing how information moves and is accessed within your organization, to spot potential vulnerabilities.
  • Identify blind spots, assessing the average employee’s awareness of security protocols, and evaluating current user access levels to identify potential oversights.
  • Implement approval processes for accessing sensitive information, ensuring that data is only available to those with a legitimate need.
  • Review external sharing policies, ensuring that your organization has a robust understanding and control over how data is shared with external parties.
  • Evaluate access controls, examining current strategies for protecting data and identifying areas for improvement.

With this assessment, you will improve your organization’s security posture against internal risks, as well as from any kind of breach — regardless of whether the threat actor is leveraging Copilot. Want to learn more? Check out our current and past work and see how we can keep your business safe. Even if you decide not to work with Katalyst, we highly recommend getting a thorough review of your security measures. Addressing and reducing security risks associated with Copilot usage is not just about preventing breaches, but about strengthening the overall security of your organization.

Josh Krodel

Consulting Engineer

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