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CDK says financial relief is coming to stop ransomware
CDK says financial relief is coming to stop ransomware
Per Teresa Moss
on July 12, 2024
Legal | Technology
CDK is promising financial relief to more than 15,000 utilities that have had their services disrupted for nearly two weeks due to a ransomware attack. CBT Global is reporting.
The outlet says CEO Brian MacDonald told dealerships there would be “future financial relief” in a letter sent Thursday, the news outlet says. The letter does not provide a compensation plan but says the company’s engagement team would provide more details.
News that CDK likely paid a $25 million ransom to Eastern European hacking group BlackSuit was reported yesterday by CNN Business.
“Identifying exactly who is sending a cryptocurrency payment can be complicated by the relative anonymity that some cryptocurrency services offer,” CNN says. “But the data on the blockchain that underpins cryptocurrency payments also tells its own story.”
CNN reports that 387 bitcoins, worth about $25 million, were sent to an account known to be controlled by hackers affiliated with BlackSuit on June 21.
CDK first closed its management system on June 19. He briefly brought the system back online the next day, only to shut it down again that night. The system provides a suite of tools for vehicle sales, financing, insurance, and inventory and parts ordering.
The system remained offline for almost two weekswith most systems restored by late July 3 and early July 4.
CDK has not been positively identified as the payer of the $25 million for BlackSuit, CNN reports. However, multiple sources told the news outlet that they were “very likely” the source.
“Federal authorities generally discourage paying ransoms to cybercriminals because the payments could fuel future attacks,” CNN reported. “But some companies feel they have no choice but to pay hackers to try to recover sensitive customer data or get their systems back online.”
CNN reports that UnitedHealth Group paid a $22 million ransom to another criminal group in February after suffering a ransomware attack that shut down pharmacies.
Mandiant, a subsidiary of Google, released a report last month which shows that ransomware increased in 2023 compared to 2022. This includes a 75% increase in posts on data breach websites and a more than 20% increase in investigations led by Mandiant.
He says 2023 was a record year, with more than $1 billion paid out to ransomware attackers.
A Class Action Lawsuit by Jay Kay Collision Center On June 25, CDK alleged that it failed to implement reasonable data security measures, causing a data breach that disrupted service to auto dealerships, auto repair centers, OEMs, software vendors, and other service providers.
The collision center claims it was unable to order parts due to the breach, which caused delays in its ability to repair vehicles. The inability to check the status of pending parts orders also created additional delays in repairing vehicles, the lawsuit says. It adds that employees had to be paid to deal with the delays, business interruption and manual parts orders.
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Photo courtesy of Sundry Photography/iStock
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