The U.S. Proposes $1 Million Fine On Colonial Pipeline For Safety Violations After Cyberattack

Security image 849329339

The DarkSide hacker group conducted the U.S. Colonial Pipeline ransomware attack in 2021. The company paid 75 bitcoins, the equivalent of 4.4 million dollars, to the cybercriminals in ransom.

It is among the most significant data breaches that an oil infrastructure company has suffered in the history of the U.S. The Colonial Pipeline company was forced to halt its pipeline operations for six days.

The U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration (PHMSA) proposes a one million dollar penalty for violating federal safety regulations to the Colonial Pipeline company.


PHMSA Proposes One Million Dollar Fine on Colonial Pipeline After Suffering a Cyberattack

The exact penalty proposed by PHMSA is $986,400. It results from an inspection performed by the regulator of the pipeline’s operator’s control room management procedures from January to November 2020.

The PHMSA accuses the company of failing to adequately plan/prepare for a manual shutdown and restarting its pipeline system, which profoundly affected the national impact when it remained out of service after the cyberattack.

When the cyberattack occurred, a fuel shortage ensued at filling stations. This affected U.S. residents in the states of Alabama, Georgia, Florida, North Carolina, and South Carolina.


About 71% of filling stations in the northern parts of South Carolina to southern Virginia experienced shortages. A few days later, Washington D.C. had about 87% of its stations suffering shortages.

Some plane raids were canceled entirely, while other airports required emergency fuel supplies. Due to these events, the fuel prices rose to their peak in 2014, reaching 3$ per gallon. Many panicked citizens rushed out to buy fuel at high prices after the cyberattack, fearing they would get even higher.

The U.S. Department of Justice Announced That It Had Reclaimed Almost Half of the Ransom Payment

On June 7, the U.S. Department of Justice announced that they had recovered 63.7 bitcoins of the ransom payment. This, however, translates to a bit more than half of the amount sent by the Colonial Pipeline. About $2.3 million out of 4.4 million.


The recovered amount would have been much higher if the bitcoin trading price hadn’t fallen since the incident occurred. The Department of State issued a ten million dollar reward for any information that might lead to the arrest of the DarkSide members.

President Joe Biden believes the DarkSide members to be of Russian origin, but there isn’t any conclusive proof. According to Blockchain analytics firm Elliptic, DarkSide or affiliates received over 90$ million in bitcoin ransom payments over the last year.

By studying the victims, 99 organizations were infected with the DarkSide malware. Though the FBI recovered some of the bitcoins paid to the ransomware attackers, they did not disclose how they obtained the private key.


The DarkSide group managed to steal 100 gigabytes of data from the Colonial Pipeline Company a day before the malware attack.

How to Minimize Hacking Risks

The DarkSide cybercriminal group is just one out of many lurking in the depths of the internet. Studies have shown that such online criminal organizations aren’t just focused on big companies for significant financial gains.

Instead, many such criminal groups are now focused on mid to small companies. This is to avoid ample public attention. This is why it is more important than ever for all types of businesses and individuals to boost their cybersecurity. Here are some tips and advice on maintaining and raising your cybersecurity levels.


Using a VPN Service

Using a VPN allows both companies and individuals to hide their IP addresses, making it harder for hackers to target them. A VPN also allows you to change your geo-location. Thus, if you are a U.S. citizen or company, you can make it seem like your server is from the U.K or anywhere else. Your privacy is also protected, and everything you search for. VPN providers, such as NordVPN, can hide your online data from your internet provider or even the government.

Two-factor Authentication

Both companies and individuals can benefit from setting up a second layer of protection for their systems. Once your first password is hacked, would-be attackers will have to deal with a second one. This is more than enough to deter most wrongdoers.

Restricted Privileges

Many people operate their PCs with full administrator privileges. Once the malware infects your PC, it will also have those administrator privileges. They can use it to wreak extensive havoc on your PC. However, if you create a profile on your PC with lesser privileges, the malware will have limited power.


Keep Your PC Updated

Updates are crucial to your cybersecurity. Updates don’t just make your software and hardware work more efficiently. They also close some weak gaps in their security. Once the software is outdated, it might be easier to hack and use for data breaches.