Florida city to pay hackers $800k ransom

MIAMI • The leaders of the city of Riviera Beach in Florida, looking weary, met quietly this week for an extraordinary vote to pay nearly US$600,000 (S$813,700) in ransom to hackers who had paralysed its computer systems.

Riviera Beach, a small city of about 35,000 people just north of West Palm Beach, became the latest government to be crippled by ransomware attacks that have successfully extorted municipalities and forced them to dig into public coffers to restore their networks. A similar breach recently cost Baltimore US$18 million to repair damage.

Even large cities, however, have had to pay smaller ransoms than Riviera Beach.

On Monday, the city council unanimously agreed to have its insurance carrier pay the hackers 65 bitcoin, a hard-to-trace digital currency, amounting to about US$592,000.

By making the payment, the city council hopes to regain access to data encrypted in the cyber attack three weeks ago, although there is no guarantee the hackers will release the data once payment is received.

Ms Rose Anne Brown, a city spokesman, said on Wednesday that Riviera Beach was working with law enforcement, which does not typically endorse making ransom payments, and with security consultants, who sometimes do as a way for their clients to recoup years of valuable information. "We are well on our way to restoring the city system," Ms Brown said.

Ransomware attacks against governments and companies have become unnervingly common worldwide as hackers have learnt that holding data hostage is an effective way to quickly extort money from public and private entities.

 
 
 

The relatively large ransom demanded from Riviera Beach suggests hackers have become emboldened by their increasingly sophisticated ability to target government agencies, said Mr Jason Rebholz, a principal for technology advisory firm Moxfive.

Even when they pay, victims find they cannot always recover all of their data, Mr Rebholz said. And the costs to rebuild the system are usually far higher than the ransom itself.

The Riviera Beach attack began May 29 after a police department employee opened an infected e-mail attachment, The Palm Beach Post reported.

Down went all of the city's online systems, including e-mail and some phones, as well as water utility pump stations. By the time the city council met in a little-noticed special meeting on Monday night, its information technology staff had managed to restore the Riviera Beach website and create new e-mail addresses for all employees.

A version of this article appeared in the print edition of The Straits Times on June 21, 2019, with the headline 'Florida city to pay hackers $800k ransom'. Print Edition | Subscribe