Kadokawa was scammed by Russian hackers

A Russian-linked hacker group claimed to have received $2.98 million in cryptocurrency from Kadokawa Corp. , a major Japanese publisher, following a massive cyberattack in June, a company insider confirmed. The information, revealed following an investigation by security firm Unknown Technologies Inc. commissioned by Kyodo News, includes online records showing a transaction of the same amount made during that month. Kadokawa has declined to confirm whether any payment was made, citing ongoing police investigations.

The attack, claimed by ransomware group BlackSuit, severely affected servers at Kadokawa’s data center on June 8, including video streaming platform Niconico and other services operated by its subsidiary Dwango Co. The hacking group claimed to have stolen and encrypted 1.5 terabytes of data, including personal and financial information, which was subsequently leaked. The compromised information included the personal data of all Dwango employees, the publisher confirmed in late June.

According to the obtained communications, the hackers initially demanded $8.25 million. However, Dwango COO Shigetaka Kurita responded that he could not pay more than $3 million due to strict compliance regulations implemented following recent bribery scandals related to the Tokyo Olympics. The hackers eventually agreed to accept $2.98 million, demanding payment within 48 hours. Unknown Technologies verified that 44 Bitcoins, equivalent to the requested amount, were sent to a cryptocurrency account on June 13.

The news has sparked a debate about the wisdom of making payments to ransomware groups. “ Negotiating with hackers is a high-risk decision, especially since many do not keep their promises to delete stolen data ,” commented a representative of the security firm. In this case, the attackers not only broke their promise, but they leaked the stolen data, amplifying the impact of the attack.

Not only does this incident put Kadokawa Corp.’s reputation in jeopardy, it also sheds light on the growing cybersecurity threats facing large companies. The possibility that a multimillion-dollar payment was made to try to contain the damage raises questions about cyberattack preparedness and response policies in the corporate world. Meanwhile, the case remains under police investigation, and the hacking group has not responded to requests for comment since the leak was revealed.

Comments from Japanese netizens were not long in coming:

« Did KADOKAWA really pay? »
" It seems that there is someone among those involved who does not know how to keep his mouth shut ."
" Is this a provocation or did they really pay? "
« So the content of the emails leaked on NewsPicks turned out to be true, right? »
" Wow, this is bigger than the three million yen case ."
« Ugh… What will Sony do about this? »
" In the end, what did it all come down to? "