A large-scale cyberattack on the Ukrainian mobile operator Kyivstar will cost Veonʼs parent company approximately 3.6 billion hryvnias, Veon said.
For the most part, the company did not feel a significant financial impact on its last yearʼs results precisely because of the temporary lack of communication or because of the costs of its restoration, replacement of equipment or compensation to external consultants and partners.
However, this year the company expects a loss of income due to compensation for the inconvenience to Kyivstar customers — after the stabilization of the network, the operator provided its users with a month of free services. The negative impact on earnings is estimated at approximately 3.6 billion hryvnias (or $95 million).
Veon noted that Kyivstar plans to continue work on restoration and compensation in the coming months.
What happened to Kyivstar
On December 12, mobile operator Kyivstar suffered a large-scale hacker attack, as a result of which subscribers lost their connection and the Internet. The Russian group Solntsepyok claimed responsibility for the attack. The SBU stated that it was connected to the Russian Main Intelligence Directorate. The SBU started an investigation under eight articles of the Criminal Code, including sabotage and treason.
Oleksandr Komarov, general director of Kyivstar, said that the hacker attack was very powerful — part of the virtual IT infrastructure was destroyed. Hackers partially achieved their goal.
On December 13, Kyivstar subscribers were blocked from accessing national roaming in order not to overload other networks. There were also difficulties in the work of the banking system, in particular, POS terminals.
On the same day, the president of Kyivstar admitted that hackers broke the companyʼs security through the account of one of the employees. According to Oleksandr Komarov, this attack is "not a question of technology", but of the fact that in any organization there can be people who "conditionally point Russian missiles or give away their passwords, because social engineers work well".
On December 20, Kyivstar resumed all services in Ukraine and abroad. Also, Kyivstar canceled the following tariff fee for its users.
On December 22, Komarov said that hackers destroyed 40% of Kyivstarʼs infrastructure. The virtual layer of the network suffered the biggest blow. He added that the attack was quite unique. About a thousand people were involved in the recovery operation.
- At the beginning of January, Ukrainian hackers from the Blackjack group hacked the Moscow Internet provider M9com and demolished its servers. 20 terabytes of data was deleted — the companyʼs official website, branch websites, mail server, cyber protection services, etc. Some residents of Moscow were left without Internet and television. It was revenge for the cyber attack on Kyivstar.