Florida Gov't Ransomware Tops $1 Million Payout

Officials in Lake City, Florida have voted to pay half a million dollars to hackers to regain access to computer files. It's the second such payment by a local government in the state in as many weeks.

Lake City's government computer system was hit by a ransomware attack in which hackers remotely encrypt files and then demand payment to unlock them. They asked for 42 units of the digital cryptocurrency Bitcoin, worth roughly $500,000. That payment method makes it much harder to trace the recipients.

The good news in this case is that public safety networks are unaffected and that all sensitive data such as the card details of people who pay fees to the city was stored elsewhere. However, the ransomware has locked up the city government's email system and put most of its landline telephones out of action. (Source: bbc.co.uk)

Related: How to Prevent Ransomware in 2018 - 10 Steps

Insurance Will Cover Most Costs

Officials have now concluded that it's more efficient to pay the ransom than lose the money and time it would take to restore the networks. Most of the cost will be covered by insurance, though the city will have to pay around $10,000 from public funds.

Only last week another Florida town, Riviera Beach, agreed to pay around $600,000 to ransomware attackers, again with insurers footing most of the bill. That was arguably a more serious attack as the compromised networks included those used for emergency response systems and water pump stations. At the time of writing officials hadn't confirmed whether full access had been restored, but the city government's website was offline. (Source: apnews.com)

Hackers May Now Keep Promises

The attacks on local government have seen something of a change in tactics by the attackers. Previously when ransomware has hit individuals, there's been no guarantee that paying up will actually get the promised unlocking. In some cases, the hackers simply keep demanding additional payments until the victim realizes they are being strung along.

With most of the government attacks, the hackers have unlocked the files when they've received the payment. That's likely because these are targeted attacks for large ransoms, so the hackers want the victims to feel assured paying up is worthwhile. They may also have concluded insurers will be less willing to cover such payments if they aren't going to be effective.

Related: How to Fix: Computer / Network Infected with Ransomware (10 Steps)

Related: 8 Ways to Protect Your Backups from Ransomware

What's Your Opinion?

Should local governments pay up if hit by a ransomware attack? Does doing so put others at risk by making ransomware attacks more likely? Is there a risk that cyber-insurance polices remove the incentive to improve security and reduce the risk of a successful attack in the first place?