Hackers Make Roughly $5M After Shutting Down Pipeline

Darius Ricks

Amid a ransomware attack shutting down a major US pipeline, sources say Colonial Pipeline Company likely paid more than $4 million to hackers to regain control of the pipeline.

“The payments have been made to the terrorists,” billionaire John Catsimatidis told FOX Business’s Maria Bartiromo on Thursday morning. “I understand from my sources that $4 million was paid.”

President Biden was asked on Thursday whether he had received knowledge that the Colonial Pipeline had paid the nearly $5 million ransom but declined to comment.

The attack targeting the Colonial Pipeline, initiated by a Russia-tied hacker gang known as DarkSide, forced the company to shut down operations after learning its financial computer networks had been infiltrated last Friday.

The pipeline firm announced that it had resumed operations on Wednesday evening. However, the company warned that supply chain issues would still take several days to resolve.

Once reports of the shutdown became public knowledge, panicked buyers and gas hoarding caused a significant increase in gas shortages as well as a spike in prices across the eastern coast of the U.S as gas stations quickly began to run out.

As of Friday morning, according to GasBuddy, 53% of Virginia gas stations reported fuel shortages. D.C. is reporting 86% outages. Maryland said 42% of all gas stations are out. And in North Carolina,71% of gas stations are without fuel.

The pipeline is a 5,500 mile-long system that transports more than 100 million gallons of gasoline, diesel, jet fuel, and heating oil per day. That is roughly 45% of the fuel consumed on the Eastern Seaboard between the Gulf Coast and the metro area of New York.

The private company reportedly paid the hacker gang roughly $5 million in cryptocurrency, making the transaction untraceable. Once paid, the hackers gave the pipeline operator a decrypting tool to restore the network, according to the Bloomberg report.

The Russian-based hacking group, Darkside, initially demanded a $100 million ransom. On Monday, Jen Psaki reported that the White House did not discuss whether to pay ransom to hackers or not with Colonial Pipeline. She also commented that the situation was a “private sector decision.”

Deputy National Security Adviser for Cyber & Emerging Technology Anne Neuberger reiterated that the federal government would be taking zero measures to defuse the crisis. Speaking to the press, Neuberger told reporters Colonial should consider “the cost-benefit” of paying ransom to the hackers to bring the pipeline back online.

“We recognize that victims of cyberattacks often face a very difficult situation,” Neuberger said. “And they have to just balance often the cost-benefit when they have no choice with regard to paying a ransom.”

The hacker group, known as DarkSide, released a statement on their website Monday claiming the group’s intentions were not to cause havoc but instead just a scheme “to make money.”

“We are apolitical, we do not participate in geopolitics, do not need to tie us with a defined government and look for our motives,” the statement said.

“Our goal is to make money, and not creating problems for society. From today we introduce moderation and check each company that our partners want to encrypt to avoid social consequences in the future.”

North Carolina, Pennsylvania, South Carolina, Tennessee, Texas, Virginia, and other state governments have declared a state of emergency in direct support of relief efforts related to gasoline shortages.

President Biden has not yet made plans to punish the foreign hackers in response to the attack on America’s infrastructure.

Join The Discussion

Related Posts