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> If a payment was made through a third party it could also be covered by the Treasury sanctions, which warn: "Foreign persons may be subject to secondary sanct

> If a payment was made through a third party it could also be covered by the Treasury sanctions, which warn: "Foreign persons may be subject to secondary sanctions for knowingly facilitating a significant transaction or transactions with these designated persons." I accidentally took a phone call for a job that basically involved using Bitcoin to launder money to send ransom payments to terrorists. They told me that although it's technically illegal, the U.S. government has never prosecuted anyone for paying a ransom. I noped out after the first phone call for obvious reasons, but it was pretty interesting just to learn about the industry. Anyway when Garmin says they didn't pay the ransom themselves, they are telling the truth, instead they would have used this company or one of their competitors. You can't just open a Coinbase Pro account and buy 10 million BTC and transfer it your first day. No bank is going to allow you to do that, since they would then be liable for facilitating that transaction. Instead you need to contract with a company that specializes in ransom payments and has already accumulated the crypto in advance. Then you pay them a percentage for their services.

CobrastanJorji 6y ago
Weird. I would think that while it's not worth the government's time to go after individual companies paying off ransoms, it would definitely be worth their time to go after a business professionally focused on paying illegal ransoms who tell interview candidates that they are aware that what they do is illegal.
- Alex3917 6y ago
  Maybe, maybe not. It's technically illegal to grow or possess any amount of weed, but in practice you don't get prosecuted (by the feds) unless you have over 100 plants or thousands of pounds. Until ~2004 it was illegal for native Americans to be within Boston city limits. There are thousands of things that are illegal, but in practice are rarely or ever prosecuted, even in cases where people are violating those laws at pretty significant scales. In my case that's not a risk I'd be willing to take, but I can see why other people would. The reason it's not prosecuted though isn't because of companies, it's because there are lots of wealthy people who travel overseas and then get kidnapped, and the government isn't going to prosecute their families for paying to not have their kids dismembered and the videos posted on YouTube. The reason companies aren't prosecuted is mainly because once you decide not to prosecute families for doing this, then anyone else can make an equal protection argument.
  - codeflo 6y ago
    The perspective that there are “thousands of things that are illegal” but not prosecuted always fascinates me, that’s not at all a common perception e.g. here in Germany. Is that a difference between common law and civil law systems? Maybe in places where code law is mostly binding, there’s a lot more pressure on the legislature to keep the law books up to date with the current norms of society.
    - cheschire 6y ago
      In Germany it's currently illegal for someone to leave an escooter outside of a designated parking space. How many of them have you seen just laying around? I know in Mainz I've seen dozens. Just saying, there's plenty of laws here that aren't prosecuted either.
    - paulcole 6y ago
      In Germany it seems as if something is outlawed then it is believed that thing physically can’t be done. In the United States, we take it as a challenge!
    - GlenTheMachine 6y ago
      Personally I see a big difference in the philosophy of lawmaking in the US vs Germany. Take driving, for instance. In the US, almost anyone who can physically climb behind the driver's seat of a car can get a drivers' license, and indeed having a drivers' license in the US is almost a fundamental right. Speed limits are then set, to first order, to accommodate the fact that you have marginal drivers behind the wheel. In addition, the police can - and do - selectively enforce driving laws. Ideally that power would be used to keep truly bad drivers off the roads, although the current civil unrest in America shows that that selective enforcement is, to put it mildly, abused. In Germany, the barrier to getting a drivers' license is much higher. More training, more stringent tests. But the effect of that is that drivers are (mostly) assumed to be able to adapt their driving to road conditions; as a consequence, you get unlimited legal driving speeds on part of the German road system. In good weather, traffic permitting. Of course, there are confounding facts: in my experience the average physical state of a car is much better in Germany than the US, and highways are better maintained. But still, the contrast is interesting. In the US, lifting speed limits on even straight roads through the desert would have poor outcomes.
- meowface 6y ago
  It's a pretty legit business model; just because it's illegal doesn't necessarily mean the government wants to go after them. "Focused on paying illegal ransoms" = "allows companies to recover from devastating attacks by being a middle-man for paying the extortion fee and getting the decryption keys". It's probably one of those things that the government tells people not to do, but acknowledges is inevitable in many cases. A company I worked at once had a meeting with such a firm, and it all sounded pretty reasonable to me. Obviously, one would hope the company has backups (which are stored in a place that can't itself become encrypted), but if they don't, sometimes the cost of paying the ransom is far, far lower than the cost of staying down. These middle-man firms have probably saved companies from enormous amounts of damage. Another commenter claimed these companies are often in cahoots with the ransomers, which maybe is sometimes true, but I highly doubt it in the case of the company we dealt with, or other US-based companies with physical locations that meet on-site. Of course in an ideal world no one wants to reward criminals, but just to give an extreme example, if someone kidnapped one of your children and held them hostage, you'd probably pay anything to get them back, and that's not far off from the situation some ransomware-affected companies end up in.
  - Dahoon 6y ago
    When most of them are from a little connected with the hackers to basically the same people and live off of ransoms I wouldn't use words like Pretty legit. I'm sure the exact business you have worked with is very different, in your opinion. I'm also sure everyone says that. I doubt a single of these businesses exists that isn't connected to hackers at all. How about a name if you are sure and we'll see?
    - meowface 6y ago
      What are you basing any of this on? Can you show a single example of an American company that this applies to? The onus is on you to substantiate the claim in the first place, not on me to prove innocence.
  - the8472 6y ago
    > Of course in an ideal world no one wants to reward criminals, but just to give an extreme example, if someone kidnapped one of your children and held them hostage, you'd probably pay anything to get them back, and that's not far off from the situation some ransomware-affected companies end up in. That's an appeal to emotion though while a company can do a cost-benefit analysis. Also, if you pay for your children that means you signal that the kidnapping business model is viable and thus endanger more children. If the government keeps you at gunpoint from paying for your children then yes, in the worst case a bunch of children might die, but the business model would die with them.
- dogma1138 6y ago
  Paying ransom is illegal in some jurisdictions because it’s seems to be the easy way to prevent ransoms if it works or not I don’t know. Ransom works when the target is capable and has sufficient incentive to pay out, if you make it so that you’ll face jail time as a CEO who orders a ransom to be paid out it’s quite likely might reduce acts of ransom. I know that there is grey area that is common in the energy and global construction sectors where companies might not be able to pay ransom legally essentially have a ransom insurance so when 3 of your workers get kidnapped in Djibouti you have your “insurance company” which also often facilitates negotiations, extraction and repatriation handle the case. (This is also common for other reasons, especially liability reduction if something goes wrong the company can wash their hands of the case and send the families after the “insurance provider”.) There is also the grey area of “private emergency services” which range from private medevac on standby to assault teams capable of executing asset recovery missions some even take pride of being able and willing to perform prison breaks.
brianbreslin 6y ago
I heard on NPR I think that some of these middlemen companies are actually often in cahoots with the ransomware distributors.
- superhuzza 6y ago
  I remember reading a fascinating article on the nature of the companies that deal with ransomware. I think it was this one. The TLDR is that these middleman companies allow ransomware victims to both pay the fine and save face, by acting as if they didn't pay the fine. The perpetrators prefer to deal with the middlemen as they know how to pay in crypto, and are predictable - the middleman and the hackers are closer to partners than adversaries. https://features.propublica.org/ransomware/ransomware-attack-data-recovery-firms-paying-hackers/ https://features.propublica.org/ransomware/ransomware-attack...
  - usrusr 6y ago
    Somehow you missed to mention the part where the middlemen put up a slow claiming to do it by computer forensics and cryptoanalysis, supplying deniability to those who do want to pay and fooling those who don't.
    - superhuzza 6y ago
      Yes sorry I missed that, I read the article several months ago. Pretty scummy of them.
gpm 6y ago
I'm curious, when you say terrorist, do you mean groups like Evil Corp (mentioned in the article), or do you mean groups of more "traditional" terrorists funding themselves via malware? Edit: Or were the ransomware payments at hand not even malware related, but more "traditional" ransoms?
SkyBelow 6y ago
If I handed you $110 to go buy $100 of drugs, then I'm still paying for the drugs. What judge would be willing to allow such a gotcha to actually pass? There would be a massive industry for legally paying for illegal things if that were the case. Then again, the acceptability of a gotcha seems to correlate more with the amount of money spent on lawyers than on the rationality of the gotcha, so as long as they have a large enough legal department the worse they'll have is a fine that they likely already included in the cost of the attack.
- jdkrkrkf 6y ago
  You could argue that they are paying under duress. No judge will hold that against you.
mytailorisrich 6y ago
I don't think that it is illegal to pay a ransom in general under US law. It is illegal to receive a ransom, though. As mentioned in the article, they are caveats related to terrorism and to dealing with entities on sanctions lists. Now, if Garmin obtained the decryption keys, as is alleged in the article, it is clear that they paid. Note that the 'anonymous sources' cited did not even deny payment but only used a weasel turn of phrase 'did not directly make a payment', which is quite different from 'did not pay'. My best guess, if a payment was made, is that they hired people experts in dealing with these situations who arranged everything and who will bill for 'consulting services'...
- Alex3917 6y ago
  > I don't think that it is illegal to pay a ransom in general under US law. I mean I’m pretty sure you’re not allowed to go wire money to Al Qaeda, or to conspire to evade anti money laundering controls in order to do so.
  - mytailorisrich 6y ago
    That's why I wrote 'in general' and that there were caveats related to terrorism. Money laundering is another issue. In general I think people are still free to spend their legitimate money (it's not money laundering to begin with).
tzs 6y ago
> They told me that although it's technically illegal, the U.S. government has never prosecuted anyone for paying a ransom If I was going to take a job doing something that is illegal, I think I might prefer one where the government has prosecuted people. Then I could look at those cases and see what people got off with just probation, which got light sentences, which got harsh sentences, what kind of plea deals were offered. Then I could at least have a decent chance of figuring out if the pay and benefits are worth the risk. If they haven't prosecuted anyone (and this is not a line of work that has been around for a very long time), I'd worry that they just haven't gotten around to it yet, and I could end up being the first. Being first could be very bad, because they might be pushing for a harsh sentence to discourage others or encourage people prosecuted later to take plea bargains.
- WrtCdEvrydy 6y ago
  To be honest, it's probably a third part company. Funny enough, back when ransomware was simpler and used the same encryption key, we managed to recover one place by using Memory Forensics on a fucked machine. I wonder if extracting the key, decrypting the files to not pay $100,000 in BTC would be illegal in some way.
  - Simon_says 6y ago
    Of course. In the US it violates DMCA.
    - nix23 6y ago
      Yes ransomware has copyrights too and often its closed source, so take the key out (disassemble) would be illegal ;)
    - cxr 6y ago
      This is simply not true.

CobrastanJorji 6y ago

Weird. I would think that while it's not worth the government's time to go after individual companies paying off ransoms, it would definitely be worth their time to go after a business professionally focused on paying illegal ransoms who tell interview candidates that they are aware that what they do is illegal.

Alex3917 6y ago
Maybe, maybe not. It's technically illegal to grow or possess any amount of weed, but in practice you don't get prosecuted (by the feds) unless you have over 100 plants or thousands of pounds. Until ~2004 it was illegal for native Americans to be within Boston city limits. There are thousands of things that are illegal, but in practice are rarely or ever prosecuted, even in cases where people are violating those laws at pretty significant scales. In my case that's not a risk I'd be willing to take, but I can see why other people would. The reason it's not prosecuted though isn't because of companies, it's because there are lots of wealthy people who travel overseas and then get kidnapped, and the government isn't going to prosecute their families for paying to not have their kids dismembered and the videos posted on YouTube. The reason companies aren't prosecuted is mainly because once you decide not to prosecute families for doing this, then anyone else can make an equal protection argument.
- codeflo 6y ago
  The perspective that there are “thousands of things that are illegal” but not prosecuted always fascinates me, that’s not at all a common perception e.g. here in Germany. Is that a difference between common law and civil law systems? Maybe in places where code law is mostly binding, there’s a lot more pressure on the legislature to keep the law books up to date with the current norms of society.
  - cheschire 6y ago
    In Germany it's currently illegal for someone to leave an escooter outside of a designated parking space. How many of them have you seen just laying around? I know in Mainz I've seen dozens. Just saying, there's plenty of laws here that aren't prosecuted either.
  - paulcole 6y ago
    In Germany it seems as if something is outlawed then it is believed that thing physically can’t be done. In the United States, we take it as a challenge!
  - GlenTheMachine 6y ago
    Personally I see a big difference in the philosophy of lawmaking in the US vs Germany. Take driving, for instance. In the US, almost anyone who can physically climb behind the driver's seat of a car can get a drivers' license, and indeed having a drivers' license in the US is almost a fundamental right. Speed limits are then set, to first order, to accommodate the fact that you have marginal drivers behind the wheel. In addition, the police can - and do - selectively enforce driving laws. Ideally that power would be used to keep truly bad drivers off the roads, although the current civil unrest in America shows that that selective enforcement is, to put it mildly, abused. In Germany, the barrier to getting a drivers' license is much higher. More training, more stringent tests. But the effect of that is that drivers are (mostly) assumed to be able to adapt their driving to road conditions; as a consequence, you get unlimited legal driving speeds on part of the German road system. In good weather, traffic permitting. Of course, there are confounding facts: in my experience the average physical state of a car is much better in Germany than the US, and highways are better maintained. But still, the contrast is interesting. In the US, lifting speed limits on even straight roads through the desert would have poor outcomes.
meowface 6y ago
It's a pretty legit business model; just because it's illegal doesn't necessarily mean the government wants to go after them. "Focused on paying illegal ransoms" = "allows companies to recover from devastating attacks by being a middle-man for paying the extortion fee and getting the decryption keys". It's probably one of those things that the government tells people not to do, but acknowledges is inevitable in many cases. A company I worked at once had a meeting with such a firm, and it all sounded pretty reasonable to me. Obviously, one would hope the company has backups (which are stored in a place that can't itself become encrypted), but if they don't, sometimes the cost of paying the ransom is far, far lower than the cost of staying down. These middle-man firms have probably saved companies from enormous amounts of damage. Another commenter claimed these companies are often in cahoots with the ransomers, which maybe is sometimes true, but I highly doubt it in the case of the company we dealt with, or other US-based companies with physical locations that meet on-site. Of course in an ideal world no one wants to reward criminals, but just to give an extreme example, if someone kidnapped one of your children and held them hostage, you'd probably pay anything to get them back, and that's not far off from the situation some ransomware-affected companies end up in.
- Dahoon 6y ago
  When most of them are from a little connected with the hackers to basically the same people and live off of ransoms I wouldn't use words like Pretty legit. I'm sure the exact business you have worked with is very different, in your opinion. I'm also sure everyone says that. I doubt a single of these businesses exists that isn't connected to hackers at all. How about a name if you are sure and we'll see?
  - meowface 6y ago
    What are you basing any of this on? Can you show a single example of an American company that this applies to? The onus is on you to substantiate the claim in the first place, not on me to prove innocence.
- the8472 6y ago
  > Of course in an ideal world no one wants to reward criminals, but just to give an extreme example, if someone kidnapped one of your children and held them hostage, you'd probably pay anything to get them back, and that's not far off from the situation some ransomware-affected companies end up in. That's an appeal to emotion though while a company can do a cost-benefit analysis. Also, if you pay for your children that means you signal that the kidnapping business model is viable and thus endanger more children. If the government keeps you at gunpoint from paying for your children then yes, in the worst case a bunch of children might die, but the business model would die with them.
dogma1138 6y ago
Paying ransom is illegal in some jurisdictions because it’s seems to be the easy way to prevent ransoms if it works or not I don’t know. Ransom works when the target is capable and has sufficient incentive to pay out, if you make it so that you’ll face jail time as a CEO who orders a ransom to be paid out it’s quite likely might reduce acts of ransom. I know that there is grey area that is common in the energy and global construction sectors where companies might not be able to pay ransom legally essentially have a ransom insurance so when 3 of your workers get kidnapped in Djibouti you have your “insurance company” which also often facilitates negotiations, extraction and repatriation handle the case. (This is also common for other reasons, especially liability reduction if something goes wrong the company can wash their hands of the case and send the families after the “insurance provider”.) There is also the grey area of “private emergency services” which range from private medevac on standby to assault teams capable of executing asset recovery missions some even take pride of being able and willing to perform prison breaks.

brianbreslin 6y ago

I heard on NPR I think that some of these middlemen companies are actually often in cahoots with the ransomware distributors.

superhuzza 6y ago
I remember reading a fascinating article on the nature of the companies that deal with ransomware. I think it was this one. The TLDR is that these middleman companies allow ransomware victims to both pay the fine and save face, by acting as if they didn't pay the fine. The perpetrators prefer to deal with the middlemen as they know how to pay in crypto, and are predictable - the middleman and the hackers are closer to partners than adversaries. https://features.propublica.org/ransomware/ransomware-attack-data-recovery-firms-paying-hackers/ https://features.propublica.org/ransomware/ransomware-attack...
- usrusr 6y ago
  Somehow you missed to mention the part where the middlemen put up a slow claiming to do it by computer forensics and cryptoanalysis, supplying deniability to those who do want to pay and fooling those who don't.
  - superhuzza 6y ago
    Yes sorry I missed that, I read the article several months ago. Pretty scummy of them.

gpm 6y ago

I'm curious, when you say terrorist, do you mean groups like Evil Corp (mentioned in the article), or do you mean groups of more "traditional" terrorists funding themselves via malware? Edit: Or were the ransomware payments at hand not even malware related, but more "traditional" ransoms?

SkyBelow 6y ago

If I handed you $110 to go buy $100 of drugs, then I'm still paying for the drugs. What judge would be willing to allow such a gotcha to actually pass? There would be a massive industry for legally paying for illegal things if that were the case. Then again, the acceptability of a gotcha seems to correlate more with the amount of money spent on lawyers than on the rationality of the gotcha, so as long as they have a large enough legal department the worse they'll have is a fine that they likely already included in the cost of the attack.

jdkrkrkf 6y ago
You could argue that they are paying under duress. No judge will hold that against you.

mytailorisrich 6y ago

I don't think that it is illegal to pay a ransom in general under US law. It is illegal to receive a ransom, though. As mentioned in the article, they are caveats related to terrorism and to dealing with entities on sanctions lists. Now, if Garmin obtained the decryption keys, as is alleged in the article, it is clear that they paid. Note that the 'anonymous sources' cited did not even deny payment but only used a weasel turn of phrase 'did not directly make a payment', which is quite different from 'did not pay'. My best guess, if a payment was made, is that they hired people experts in dealing with these situations who arranged everything and who will bill for 'consulting services'...

Alex3917 6y ago
> I don't think that it is illegal to pay a ransom in general under US law. I mean I’m pretty sure you’re not allowed to go wire money to Al Qaeda, or to conspire to evade anti money laundering controls in order to do so.
- mytailorisrich 6y ago
  That's why I wrote 'in general' and that there were caveats related to terrorism. Money laundering is another issue. In general I think people are still free to spend their legitimate money (it's not money laundering to begin with).

tzs 6y ago

> They told me that although it's technically illegal, the U.S. government has never prosecuted anyone for paying a ransom If I was going to take a job doing something that is illegal, I think I might prefer one where the government has prosecuted people. Then I could look at those cases and see what people got off with just probation, which got light sentences, which got harsh sentences, what kind of plea deals were offered. Then I could at least have a decent chance of figuring out if the pay and benefits are worth the risk. If they haven't prosecuted anyone (and this is not a line of work that has been around for a very long time), I'd worry that they just haven't gotten around to it yet, and I could end up being the first. Being first could be very bad, because they might be pushing for a harsh sentence to discourage others or encourage people prosecuted later to take plea bargains.

WrtCdEvrydy 6y ago
To be honest, it's probably a third part company. Funny enough, back when ransomware was simpler and used the same encryption key, we managed to recover one place by using Memory Forensics on a fucked machine. I wonder if extracting the key, decrypting the files to not pay $100,000 in BTC would be illegal in some way.
- Simon_says 6y ago
  Of course. In the US it violates DMCA.
  - nix23 6y ago
    Yes ransomware has copyrights too and often its closed source, so take the key out (disassemble) would be illegal ;)
  - cxr 6y ago
    This is simply not true.