Ransomware in the ION group is holding up EU transactions

Attackers this week shut down the business of London-based ION Cleared Derivatives, a software company that supports derivatives trading, forcing Europe’s biggest banks to process trades manually and causing a major futures exchange to delay settlement of trades for two hours.

ION Cleared Derivatives, part of the ION Group that offers software designed to automate the complete trade lifecycle and the derivatives clearing process, said in a statement on its website late Tuesday that a “cyber security incident” affected some of its services and that “the incident involved a specific environment. All affected servers are down And the repair of the services continues.”

The attack originated from the Russian ransomware gang LockBit, according to a memo from ION obtained by Bloomberg.

The Futures Industry Association (FIA) said on Wednesday that the attack “is affecting the trading and clearing of exchange-traded derivatives by ION clients in global markets. We are working with affected members, including clearing firms and exchanges, as well as market regulators and others, to assess the extent of the impact on Trading, processing and clearing”.

The FIA said in a statement on Wednesday that it was coordinating communication and information sharing through regular talks with relevant parties, “reviewing the affected companies, how companies can work together to mitigate the disruption and seeking clarity on concerns regarding affected regulatory obligations and reporting”.

Meanwhile, the ICE futures exchange, which handles soft markets in London, announced on Wednesday that it had extended the cut-off time for maintaining positions from 10 a.m. to noon.

The exchange warned that the extension “will cause a delay in the publication of open interest and the potential for an incorrect open interest on the days affected by the supplier’s stock.”

The settlement of derivative investments is time sensitive because buyers commit to sell goods or livestock to a counterparty who agrees to buy the goods or livestock at a certain price on a certain date. Often, derivative investments involve buying options based on price movement or swaps with other counterparties to hedge potential losses.

https://www.bankinfosecurity.com/ransomware-hit-on-ion-group-delays-eu-derivatives-trades-a-21077