On Tuesday, the Biden administration announced sanctions against a cryptocurrency exchange for enabling illegal ransomware payments, part of a broader crackdown on the growing threat. Ransomware is a type of cyberattack where actors often shut down access to key programs and demand payment, usually in a cryptocurrency like bitcoin, to unlock them.
In its first action against a virtual currency exchange over ransomware activity, the Treasury Department accused Suex OTC, SRO of facilitating illicit transactions related to at least eight ransomware variants. The action is the first of its kind against a virtual currency exchange, and it comes after several industries have been crippled by cyberattacks and even U.S. government agencies have been threatened. The Treasury said ransomware payments totaled more than $400 million in 2020 alone, more than four times that of 2019.
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“Exchanges like Suex are critical to attackers’ ability to extract profits from ransomware attackers,” Treasury Deputy Secretary Wally Adeyemo said in a call with reporters previewing the announcement on Monday evening. The action “is a signal of our intention to expose and disrupt the illicit infrastructure using these attacks.”
Ransomware is used by hackers to take down systems that control everything from hospital billing to manufacturing. They stop only when they receive hefty payments, usually in cryptocurrency. Hackers have targeted numerous large US companies this year in large-scale ransomware attacks. During one such attack, the US East Coast experienced temporary fuel supply shortages due to a pipeline attack on Colonial Pipeline. Hackers also targeted an Iowa-based agricultural firm, sparking fears of disruptions to grain harvesting in the Midwest.
In 2020 ransomware payments reached over $400 million (roughly Rs. 2,950 crores), more than four times the level in 2019, Anne Neuberger, deputy national security adviser for cyber, told reporters on the call. As a result, President Joe Biden reportedly told Vladimir Putin during a July meeting that ransomware gangs should not target “critical infrastructure” companies. Cybersecurity experts and federal prosecutors say such groups often operate from Russia or Ukraine.
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According to officials on the call, the administration is updating sanctions guidance to encourage victims of ransomware attacks to share information with law enforcement. Over 40 percent of known Suex transactions involved illicit actors, according to the Treasury. While some exchanges are exploited by bad actors, others like Suex, “facilitate illicit activities for their own illicit gains” the agency added in a release.
“Rogue cryptocurrency exchanges have long been key enablers for ransomware gangs,” said Tom Robinson, co-founder and chief scientist of blockchain analysis firm Elliptic. “This action by the US government sends a clear signal that it will not tolerate this activity, wherever it is based.”