Hackers at Center of East Coast Gas Shortage Got $5M Ransom

Amid reports that Colonial Pipeline only resumed service after last week’s ransomware attack by paying a hefty ransom, President Joe Biden issued a call Thursday for tougher national cybersecurity infrastructure.

Last week’s hack of the nation’s largest fuel pipeline led to panic-buying that contributed to more than 1,000 gas stations running out of fuel. (AP Photo/Marta Lavandier(AP Photo/Marta Lavandier)

WASHINGTON (CN) — Colonial Pipeline reportedly paid almost $5 million in ransom to a criminal hacker gang that has crippled fuel service on the East Coast for days.

The company did not return request for comment this morning, but reports citing individuals familiar with the negotiations said the funds were paid in cryptocurrency hours after the breach last Thursday. FBI investigators suspect a group of cyber extortionists and hackers dubbed DarkSide of waging the attack.

President Biden said Thursday afternoon that Russia was not responsible for the attack but that the hackers are based there. The administration has been in touch the Russian government, and Biden told reporters that he is confident he “read the FBI report accurately and Putin was not involved.”

Biden would not say however whether he was briefed on Colonial Pipeline’s reported decision to pay the ransom.

Colonial said Wednesday its services were on the way to restoration by the end of this week, but that because it takes some time for all operations to get underway. In the meantime, expect some spurts and starts at fuel pumps through the nation.

Initial reports after the hack cited anonymous sources claiming Colonial Pipeline had no intent to pay any ransom that would restore the data DarkSide encrypted.

The FBI advises against paying ransom to companies. Most industries rely on private cybersecurity firms to help them navigate the mire of a ransomware attack. But the situation can become deeply complex when sensitive data is involved and difficult to replace.

On Monday, during a press briefing at the White House, deputy national security advisor Anne Neuberger fielded a question from a reporter on whether companies should pay up when put to the gears.

“We recognize, though, that companies are often in a difficult position if their data is encrypted and they do not have backups and connect recover the data,” Neuberger said.

Fuel service is expected to be more widely restored by the weekend.

“Do not get more than what you need,” Biden said, emphasizing that panic buying fuel is unnecessary. “Shortages will improve by the weekend.”

Not only does the run on gas have a counterintuitive effect, it has also proven dangerous. A Tampa, Florida, man who hoarded gasoline in two large gas cans and then stowed them in his Hummer had to have firefighters called after his vehicle exploded at the pumps.

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