FBI confirms cyberattack on US pipeline carried out by DarkSide

The cyberextortion attempt caused a major US pipeline to shut down and the administration of US President Joe Biden to loosen regulations for the transport of petroleum products on highways as part of an ‘all-hands-on-deck’ effort to avoid disruptions in the fuel supply.

The Colonial Pipeline, which transports fuel along the United States' East Coast, says it had to stop operations because it was the victim of a cyberattack and is now in contact with law enforcement and other federal agencies, including the US Department of Energy [File: Brynn Anderson/AP Photo]
The Colonial Pipeline, which transports fuel along the United States' East Coast, says it had to stop operations because it was the victim of a cyberattack and is now in contact with law enforcement and other federal agencies, including the US Department of Energy [File: Brynn Anderson/AP Photo]

The cyberextortion attempt that has forced the shutdown of a vital United States pipeline was carried out by a criminal gang known as DarkSide, the Federal Bureau of Investigation (FBI) confirmed on Monday.

“The FBI confirms that the Darkside ransomware is responsible for the compromise of the Colonial Pipeline networks,” said a statement issued by the bureau. “We continue to work with the company and our government partners on the investigation.”

The shutdown, meanwhile, stretched into its third day, with the Biden administration loosening regulations for the transport of petroleum products on highways as part of an “all-hands-on-deck” effort to avoid disruptions in the fuel supply.

Experts said that petrol prices are unlikely to be affected if the pipeline is back to normal in the next few days but that the incident — the worst cyberattack to date on critical US infrastructure — should serve as a wake-up call to companies about the vulnerabilities they face.

The pipeline, operated by Georgia-based Colonial Pipeline, carries gasoline and other fuel from Texas to the Northeast. It delivers roughly 45 percent of the fuel consumed on the East Coast, according to the company.

It was hit by what Colonial called a ransomware attack, in which hackers typically lock up computer systems by encrypting data, paralysing networks, and then demanding a large ransom to unscramble it.

On Sunday, Colonial Pipeline said it was actively in the process of restoring some of its IT systems. It says it remains in contact with law enforcement and other US agencies, including the Department of Energy, which is leading the federal government response. The company has not said what was demanded or who made the demand.

DarkSide, which cultivates a Robin Hood image of stealing from corporations and giving a cut to charity, is among ransomware gangs that have “professionalized” a criminal industry that has cost Western nations tens of billions of dollars in losses in the past three years.

DarkSide claims that it does not attack hospitals, nursing homes, educational or government targets and that it donates a portion of its take to charity. It has been active since August and, typical of the most potent ransomware gangs, is known to avoid targeting organisations in former Soviet bloc nations.

Colonial did not say whether it has paid or was negotiating a ransom, and DarkSide neither announced the attack on its dark web site nor responded to an Associated Press reporter’s queries. The lack of acknowledgement usually indicates a victim is either negotiating or has paid.

On Sunday, Colonial Pipeline said it is developing a “system restart” plan. It said its main pipeline remains offline but some smaller lines are now operational.

“We are in the process of restoring service to other laterals and will bring our full system back online only when we believe it is safe to do so, and in full compliance with the approval of all federal regulations,” the company said in a statement.

US Secretary of Commerce Gina Raimondo said on Sunday that ransomware attacks are “what businesses now have to worry about”, and that she will work “very vigorously” with the Department of Homeland Security to address the problem, calling it a top priority for the administration.

“Unfortunately, these sorts of attacks are becoming more frequent,” she said on the CBS programme Face the Nation. “We have to work in partnership with business to secure networks to defend ourselves against these attacks.”

She said US President Joe Biden was briefed on the attack.

“It’s an all-hands-on-deck effort right now,” Raimondo said. “And we are working closely with the company, state and local officials to make sure that they get back up to normal operations as quickly as possible and there aren’t disruptions in supply.”

The Department of Transportation issued a regional emergency declaration Sunday, relaxing hours-of-service regulations for drivers carrying petrol, diesel, jet fuel and other refined petroleum products in 17 states and the District of Columbia. It is letting them work extra or more flexible hours to make up for any fuel shortage related to the pipeline outage.

One of the people close to the Colonial investigation said that the attackers also stole data from the company, presumably for extortion purposes. Sometimes stolen data is more valuable to ransomware criminals than the leverage they gain by crippling a network, because some victims are loath to see sensitive information of theirs dumped online.

Security experts said the attack should be a warning for operators of critical infrastructure — including electrical and water utilities and energy and transportation companies — that not investing in updating their security puts them at risk of catastrophe.

Ed Amoroso, CEO of TAG Cyber, said Colonial was lucky its attacker was at least ostensibly motivated only by profit, not geopolitics. State-backed hackers bent on more serious destruction use the same intrusion methods as ransomware gangs.

A major pipeline that transports fuels along the East Coast of the US says it had to stop operations because it was the victim of a cyberattack [File: Mark Lennihan/AP Photo]
“For companies vulnerable to ransomware, it’s a bad sign because they are probably more vulnerable to more serious attacks,” he said. Russian cyberwarriors, for example, crippled the electrical grid in Ukraine during the winters of 2015 and 2016.

Cyberextortion attempts in the US have become a death-by-a-thousand-cuts phenomenon in the past year, with attacks forcing delays in cancer treatment at hospitals, interrupting schooling and paralysing police and city governments.

Tulsa, Oklahoma this week became the 32nd state or local government in the US to come under ransomware attack, said Brett Callow, a threat analyst with the cybersecurity firm Emsisoft.

Average ransoms paid in the US jumped nearly threefold to more than $310,000 last year. The average downtime for victims of ransomware attacks is 21 days, according to the firm Coveware, which helps victims respond.

David Kennedy, founder and senior principal security consultant at TrustedSec, said that once a ransomware attack is discovered, companies have little recourse but to completely rebuild their infrastructure or pay the ransom.

“Ransomware is absolutely out of control and one of the biggest threats we face as a nation,” Kennedy said. “The problem we face is most companies are grossly underprepared to face these threats.”

Colonial transports gasoline, diesel, jet fuel and home heating oil from refineries on the Gulf Coast through pipelines running from Texas to New Jersey. Its pipeline system spans more than 8,850km (5,500 miles), transporting more than 380 million litres (100 million gallons) a day.

Debnil Chowdhury at the research firm IHS Markit said that if the outage stretches to one to three weeks, gas prices could begin to rise.

“I wouldn’t be surprised, if this ends up being an outage of that magnitude, if we see a 15- to 20-cent rise in gas prices over next week or two,” he said.

The Department of Justice has a new task force dedicated to countering ransomware attacks.

While the US has not suffered any serious cyberattacks on its critical infrastructure, officials say Russian hackers in particular are known to have infiltrated some crucial sectors, positioning themselves to do damage if armed conflict were to break out. While there is no evidence the Kremlin benefits financially from ransomware, US officials believe President Vladimir Putin savours the mayhem it wreaks on adversaries’ economies.

Iranian hackers have also been aggressive in trying to gain access to utilities, factories and oil and gas facilities. In one case in 2013, they broke into the control system of a US dam.

Source: AP

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