Struggling phone repair and insurance company meets demise post humongous ransomware payment - Reducing workforce from over a hundred to a mere eight proves insufficient
In a series of unfortunate events, two British businesses, the Einhaus Group and Knights of Old, have been hit hard by the 'Akira' ransomware attack perpetrated by the hacker group 'Royal'.
The attack on the Einhaus Group, a Northampton-based company founded by Wilhelm Einhaus (72), occurred in March 2023. 'Royal' encrypted all of the group's systems, demanding a ransom payment estimated at $230,000 in Bitcoins. Despite paying the ransom, the company suffered losses estimated in the mid-seven-figure euro range due to downtime, lost productivity, and opportunity costs.
The financial impact was significant, leading to drastic cost-cutting measures. The Einhaus Group reduced its workforce from 170 to 8 employees, sold its headquarters building, and liquidated various capital investments. Three companies associated with the Einhaus Group have formally entered insolvency proceedings.
Law enforcement was involved in the incident, but the ransom cash is still being held by them. The authorities have rejected the company's pleas for the return of its ransom funds.
The public prosecutor's office in Germany has seized crypto assets in the high six-figure euro range, and German law enforcement has apprehended three hacker suspects believed to be associated with the 'Royal' hacker group.
Meanwhile, the 158-year-old UK-based transportation company, Knights of Old (KNP), has collapsed as a result of the 'Akira' ransomware attack. The attack caused significant business losses, estimated to be in the millions, leading to the loss of 700 jobs. Northamptonshire-based Knights of Old trucks are now off the road.
This case serves as a stark reminder of the long-term consequences for businesses like the Einhaus Group after paying a ransom in a cyberattack. The extreme financial strain, operational disruption, and potential insolvency are just a few of the challenges faced by the company.
The public is urged to take cybersecurity measures seriously to prevent or mitigate such attacks. As authorities in some jurisdictions move toward restricting or banning ransom payments to discourage cybercriminal activity, businesses must be prepared to navigate these complexities after an attack.
Despite the devastating impact, Wilhelm Einhaus remains hopeful, stating that he will "start afresh" if the worst happens. The Einhaus Group maintains some service partnerships and signals a long-term intent to rebuild, demonstrating resilience in the face of adversity.
References: 1. BBC News 2. The Guardian 3. Forbes 4. Cybersecurity Docket
- The financial strain caused by the ransomware attack on the Einhaus Group has necessitated technology-focused changes in their operations, as they aim to bolster their cybersecurity measures to prevent future attacks.
- The collapse of the 158-year-old Knights of Old has emphasized the crucial role of effective cybersecurity in maintaining the financial health and business continuity of any organization, especially in the sensitive realm of transportation.
