Microsoft 365 Copilot security risks come mostly from old file permissions, not the AI itself. Copilot can only see what a signed-in employee already has access to, so if your SharePoint, OneDrive, and Teams sharing has been left loose for years, Copilot will surface that data in seconds when someone asks the right question. Microsoft has also had to patch a real vulnerability in Copilot itself, which means the tool is worth a proper look before your team turns it on or expands how it’s used.
- Copilot inherits a user’s existing permissions; it does not grant new access on its own.
- A critical Copilot information disclosure flaw, CVE-2026-26129, was patched by Microsoft in May 2026.
- 99% of organizations have sensitive data exposed in a way that AI tools can easily surface, according to Varonis’ State of Data Security Report.
- The fix is mostly permissions cleanup: sharing links, guest accounts, and sensitivity labels, not a Copilot setting.
- A short readiness review before rollout is far cheaper than explaining an accidental disclosure after the fact.
What is a Microsoft 365 Copilot security risk, exactly?
Copilot works by searching across the Microsoft Graph, which means it can pull from email, chat, calendar, and every SharePoint or OneDrive file a user can open. If a folder was shared with “Anyone with the link” back in 2021 and forgotten, Copilot doesn’t know that was a mistake. It treats that folder the same as anything else the user can legitimately reach. Ask it to summarize recent HR discussions or pull together customer contract terms, and it will happily do so, even if the person asking should not have seen that material. The risk isn’t a bug. It’s the tool doing what it was built to do, against data hygiene that was never cleaned up.
Has Microsoft actually had to patch Copilot itself?
Yes, and it’s worth naming so this doesn’t sound like vague AI anxiety. In May 2026, Microsoft disclosed and fixed CVE-2026-26129, a critical information disclosure vulnerability in Copilot’s Business Chat with a CVSS score of 7.5. An unauthorized attacker could exploit how the service parsed certain input to expose data it shouldn’t have. Microsoft runs Copilot as a hosted service, so the fix shipped on their end with no update required on your machines. That’s good news operationally, but it’s also a reminder that Copilot has its own bug history, not just inherited risk from your permissions.
Why does oversharing matter more once Copilot is turned on?
Oversharing has always been a risk. What changes with Copilot is discovery speed. Before, a stale “anyone with the link” folder buried three levels deep in SharePoint was safe mostly because nobody would ever stumble onto it or think to search for it. Copilot removes that friction. A natural-language question like “what do we know about the Anderson account” can surface exactly that folder in one pass, no manual digging required. Varonis’ research found that 99% of organizations have sensitive data exposed in a way AI tools can easily surface, and that most companies have never labeled their files well enough to stop it. For a 20 to 60 person Boston firm without a dedicated data governance function, that’s a realistic gap. It’s the same weak point we flagged in our recent look at SharePoint permission risk: attackers and AI tools both benefit from access that was never cleaned up.
What should a Boston small business do before rolling out Copilot?
Start with an inventory, not a policy document. Pull a report of every SharePoint site and OneDrive folder shared externally or with “Anyone with the link,” and check who actually still needs that access. Review your guest user list in Microsoft Entra ID and remove accounts tied to vendors or contractors who haven’t worked with you in a year. Turn on sensitivity labels for at least your most obvious categories, financial records, HR files, and client contracts, so Copilot and your DLP rules both know what’s sensitive. None of this requires new software, just a focused afternoon in the Microsoft 365 admin center before Copilot goes from a three-person pilot to a company-wide rollout. It’s also worth reviewing multi-factor authentication coverage, since a compromised account with broad Copilot access is a bigger prize than one without it, a point covered in more detail in our piece on device code phishing against Microsoft 365 accounts.
Frequently asked questions
Does Microsoft 365 Copilot create new security holes on its own?
Not exactly. Copilot reads whatever a signed-in user is already permitted to see across Outlook, SharePoint, OneDrive, and Teams. It does not grant new access, but it does make old, unnoticed oversharing much easier to find and summarize.
Has Microsoft actually fixed a Copilot vulnerability?
Yes. Microsoft patched a critical Copilot Business Chat information disclosure flaw, CVE-2026-26129, in May 2026. It was server-side, so no customer action was required, but it confirms Copilot itself is a live attack surface, not just a permissions mirror.
How long does a Copilot readiness check take for a small business?
For a business with fewer than 100 employees, a focused review of SharePoint and OneDrive sharing links, guest accounts, and sensitivity labels usually takes a few hours to a couple of days, depending on how much cleanup is needed.
Should we just avoid turning on Copilot until we’re sure?
That’s a reasonable short-term call, but it doesn’t fix the underlying problem. The same oversharing that makes Copilot risky also makes it easier for a phished employee or a compromised account to find and exfiltrate sensitive files today, with or without AI involved.
If your business is piloting or planning a Microsoft 365 Copilot rollout and nobody has audited what it can actually see yet, that’s the specific gap worth closing before more employees get access. Boston Managed IT offers a free 15-minute Microsoft 365 review to check your sharing links, guest accounts, and sensitivity labels before Copilot turns yesterday’s oversharing into tomorrow’s incident. Call (617) 322-5155 or visit bostonmit.com/contact to schedule one.
— Boston Managed IT
