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The Justice Department said Monday it recovered some $ 2.3 million in cryptocurrency ransom paid by Colonial Pipeline Co, cracking down on hackers who launched the most disruptive U.S. cyberattack on record.
Deputy Attorney General Lisa Monaco said investigators seized 63.7 Bitcoins, now valued at around $ 2.3 million, paid by Colonial (COLPI.UL) after its systems were hacked last month that resulted in massive shortages at gas stations on the east coast of the United States.
The justice ministry “found and recovered the majority” of the ransom paid by Colonial, Monaco said.
An affidavit filed on Monday said the FBI was in possession of a private key to unlock the hackers’ Bitcoin wallet. It is not known how the FBI gained access to this key.
A San Francisco judge approved the seizure of funds from this “cryptocurrency address,” which the file said was located in the Northern District of California.
Colonial Pipeline said it paid hackers nearly $ 5 million to regain access. Bitcoin’s value has fallen in recent weeks, trading at around $ 36,000 on Monday after hitting $ 63,000 in April.
“Today we turned the situation around on DarkSide,” Monaco said, referring to a ransomware group widely believed to have been behind the crippling fuel pipeline attack.
The hack caused a multi-day shutdown, spiking gas prices, panic buying and localized fuel shortages. This posed a major political puzzle for President Joe Biden as the US economy began to emerge from the COVID-19 pandemic. Read more
The White House last week urged business executives and business leaders to step up security measures to protect against ransomware attacks after the colonial hack and subsequent intrusions that disrupted the operations of a large meat packing company. Read more
FBI Deputy Director Paul Abbate, who spoke at the same press conference as Monaco on Monday, described DarkSide as a Russian-based cybercrime group.
Abbate said the FBI is tracking more than 100 ransomware variants. DarkSide itself has victimized at least 90 U.S. companies, including manufacturers and healthcare providers, Abbate said.
Commerce Secretary Gina Raimondo said on Sunday that the Biden administration is exploring all options to defend against ransomware attacks and that the subject will be on the agenda when President Joe Biden meets with Russian President Vladimir Putin this month. Read more
Tom Robinson, co-founder of crypto tracking company Elliptic, said the Bitcoin wallet the funds came from contained 69.6 Bitcoins. The seizure announced on Monday was only for 63.7 Bitcoins, which Robinson said likely represented the share that went to the DarkSide “branch” that initially hacked Colonial.
Investigators say DarkSide has often used a model of partnering with other hacking groups to compromise numerous victims.
DarkSide would normally keep a smaller stake for its role in providing the encryption software and negotiating with the victim, Robinson said. Monday, a few minutes after the transfer of the first funds, the others followed. The U.S. government may also have seized that second amount but has yet to announce it, Robinson said.
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