In November of the previous year, Rackspace, a well-known company providing cloud computing services, fell victim to a cyber-attack orchestrated by the Play Ransomware group. This attack led to a disruption in their email exchange services for a duration of a few weeks. The company’s response to this incident included the release of an earnings presentation that highlighted the considerable financial impact. Approximately $10 million had already been expended on remediation efforts, affecting a substantial customer base of around 30,000 individuals.
In a statement submitted to the SEC, Rackspace indicated that the expenses associated with this incident could potentially rise further. This is primarily due to the emergence of multiple lawsuits from customers within the cloud business domain. These legal actions are seeking compensatory measures to address the business losses incurred as a result of the cyber attack.
Rackspace, headquartered in Texas, is not alone in bearing the financial brunt of such incidents. The financial burden extends to costs related to investigative processes, remediation endeavors, legal consultations, professional services, and the necessity of hiring additional personnel.
Although Rackspace remained resilient against the demands of the Play Ransomware group, the company’s financial outlay to counteract the adverse effects of the file encrypting malware has reached nearly $10 million thus far.
The FBI issued a statement in November 2020, emphasizing that paying ransoms to hackers is illegal, as it perpetuates criminal activities and does not guarantee the provision of a decryption key.
Security experts advise victims of such incidents to adopt a thoughtful approach in managing their IT environments. It’s crucial to take actions that are economically viable, as these situations can erode profits and cast a lasting shadow on annual earnings for an extended period of time.
The post Rackspace spends $10m in ransomware cleanup costs appeared first on Cybersecurity Insiders.
August 29, 2023 at 10:00AM
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