LockBit ransomware group’s leader unmasked and hit with sanctions; UK house prices inch higher– business live | Business

Time to recap…..

The UK, US and Australia have sanctioned the Russian leader of one of the world’s most prolific ransomware groups, LockBit.

As part of an ongoing international law enforcement investigation, Russian national Dmitry Khoroshev has been identified as one of the leaders of the group, which the Government says has been responsible for extorting more than one billion dollars from victims globally.

As part of the sanctions, the Foreign Office said he would now be subject to a series of asset freezes and travel bans.

The UK’s sanctions minister, Anne-Marie Trevelyan says:

“In sanctioning one of the leaders of LockBit we are taking direct action against those who continue to threaten global security, while simultaneously exposing the malicious cyber-criminal activity emanating from Russia.”

The US Justice Department has unsealed a 26-count indictment against Khoroshev returned by a grand jury in the District of New Jersey.

Deputy Attorney General Lisa Monaco explains:

“Working with U.S. and international partners, we are using all our tools to hold ransomware actors accountable—and we continue to encourage victims to report cyberattacks to the FBI when they happen. Reporting an attack could make all the difference in preventing the next one.”

Here’s the rest of today’s business news stories:

LockBit was particularly disruptive because it was designed as “ransomware-as-a-service” (RaaS) – meaning cybercriminals could buy the package and operate it themselves.

The DoJ alleges that Khoroshev — as the LockBit developer — would typically receive a 20% share of each ransom payment extorted from LockBit victims, with whoever conducted the hack getting the remaining 80%.

Today’s indictment says Khoroshev and his co-conspirators extracted at least $500m in ransom payments from their victims, meaning he received at least $100m in digital currency.

Dmitry Khoroshev will now be subject to a series of asset freezes and travel bans, the UK’s National Crime Agency says.

The UK’s sanctions minister, Anne-Marie Trevelyan says:

“Together with our allies we will continue to crack down on hostile cyber activity which is destroying livelihoods and businesses across the world.

“In sanctioning one of the leaders of LockBit we are taking direct action against those who continue to threaten global security, while simultaneously exposing the malicious cyber-criminal activity emanating from Russia.”

The US Department of Justice has unsealed a raft of charges against Dimitry Yuryevich Khoroshev over his alleged roles as the creator, developer, and administrator of the LockBit ransomware group.

Fresh from being sanctioned by the US, UK and Australia today, Khoroshev has also been charged by a 26-count indictment returned by a grand jury in the District of New Jersey.

Attorney General Merrick Garland explains that the charges follow the international disruption campaign targeting LockBit carried out earlier this year:

“Earlier this year, the Justice Department and our U.K. law enforcement partners disrupted LockBit, a ransomware group responsible for attacks on victims across the United States and around the world.

“Today we are going a step further, charging the individual who we allege developed and administered this malicious cyber scheme, which has targeted over 2,000 victims and stolen more than $100 million in ransomware payments. We will continue to work closely alongside our partners, across the U.S. government and around the world to disrupt cybercrime operations like LockBit and to find and hold accountable those responsible for them.”

Just in: The US, UK and Australian governments say they have sanctioned the leader of the LockBit ransomware group, whose recent victims include Royal Mail.

The US Treasury say it is exposing that that the cybercriminal responsible for the Lockbit ransomware variant is Dmitry Yuryevich Khoroshev, a Russian national.

Lockbit has conducted a swath of hacks, using phishing attacks to tricks computer users into downloading malware onto their computers. The infected computer is then compromised and encrypted, with Lockbit demanding money from the victim to release their data.

Khoroshev, the US Treasury alleges, is the primary operator of the well-known and public-facing LockBit-related cybercrime moniker, “LockBitSupp.”

In a statement, the Treasury explains:

As a core LockBit group leader and developer of the LockBit ransomware, Khoroshev has performed a variety of operational and administrative roles for the cybercrime group, and has benefited financially from the LockBit ransomware attacks.

In addition, Khoroshev has facilitated the upgrading of the LockBit infrastructure, recruited new developers for the ransomware, and managed LockBit affiliates. He is also responsible for LockBit’s efforts to continue operations after their disruption by the U.S. and its allies earlier this year.

The US Department of State has also announced a reward of up to $10m for information that leads to the identification or location of any senior individual in the LockBit group.

Khoroshev has also been added to the UK’s sanctions list, and faces a series of asset freezes and travel bans.

The UK government’s list of sanctioned individuals says:

Dmitry Yureyvich KHOROSHEV is or has been involved in relevant cyber activity in that he has been responsible for, engaged in, provided support for or promoted the commission, planning or preparation of relevant cyber activity, or provided technical assistance that could contribute to relevant cyber activity.

Lockbit’s operations were severely disrupted by a coordinated international crackdown earlier this year.

Today, the UK’s National Crime Agency reports that between June 2022 and February 2024, more than 7,000 attacks were built using Lockbit’s services. The top five countries hit were the US, UK, France, Germany and China.

Good news for holidaymakers looking to fly overseas this summer – ticket fares will rise less than expected.

That’s according to budget airline Ryanair’s CEO, Michael O’Leary, who has predicted that ticket fare prices this summer are likely going to be lower than previously expected,

Speaking to reporters in Brussels today, O’Leary says:

“Looking at summer … We thought pricing would be up 5-10%. We’re heading to flat (pricing year-on-year) to 5% up, which is surprising with a lot of the Airbus <AIR.PA> fleet grounded for maintenance.”

This appears to have knocked shares in airlines. EasyJet’s shares are now down 5% in London, with British Airways parent company IAG down 1.5% and Wizz Air off 3%.

Ryanair’s shares are down 4%.

Airlines have been pushing up prices since the end of pandemic restrictions, as they try to recoup their losses during Covid-19 and take advantage of customers keen to travel again.

In April, one industry consultant said he was seeing “quite stunning levels of pricing” in the market, as passengers stumped up higher air fares.

Advances in artificial intelligence risk destabilising the financial markets, a Bank of England policymaker is warning today.

Jonathan Hall, an external member of our Financial Policy Committee (FPC), argues that market stability could be threatened if deep neural networks – programs that uses multiple layers of artificial neurons to process information – were turned into deep trading agents, which select and execute trading strategies.

Hall tells the University of Exeter Business School that AI traders could amplify shocks and undermine market stability.

He says there are two risks:

[First] That deep trading agents, whilst increasing efficiency in good times, could lead to an increasingly brittle and highly correlated financial market.

[Second] That the incentives of deep trading agents could become misaligned with that of regulators and the public good.

Hall cites a well-known example of AI confusion, where researches taught a system what a panda looked like, and then added noise to the picture of a panda – leading the AI system to declare that the animal was almost certainly a gibbon.

Hall say:

From a financial stability perspective, this raises the question of whether through bad luck, or targeted malicious behaviour, a tiny change in market prices could abruptly shift the trading signal from “buy” to “strong sell”?

And, unlike in the image example, it would be extremely difficult for a human to know whether that sudden shift was the result of a model error, or indicated some important, but inscrutable, information in the pattern of prices.

Hall then cites the idea that an AI system could be trained on all historic price changes and all readable historic data relevant to fundamental financial analysis. Such an algorithm would have risk, and profit and loss, rules built in, and over time would outcompete human traders.

If that happened, capital would shift towards this high-performing AI system. But if it was unable to absorb shocks, this ecosystem that is unsustainable.

Hall says there are two general concerns about such a trading algorithm based on analysing the fair value of stocks – either it shows exhibit volatile, unpredictable behaviour because it was not trained well, or it fails because it can’t adjust to a change in market environment.

But there’s another danger too – what about an AI system that analyse order book data to predict the imminent order flow of other traders?

Studies have shown that such “informed AI speculators” will behave in a cooperative, way until triggered to do otherwise, leading to lower price informativeness and lower market liquidity.

And worse – the AI system might learn that it can make the best profits during times of market instability, so decide to amplify any external shock that hits the markets….

Hall argues that City firms must ensure that any AI systems they develop are aligned with regulations.

He says:

Any deep trading algorithms must be trained in a way that ensures that their behaviour is consistent the regulatory rule book.

This is a dynamic process in two respects: Training must be updated to respond to any discovered divergence between regulatory intent and reaction function; and trading managers must keep reinforcing the rules to make sure they are not forgotten