Devastating ransomware attack blamed, as veteran firm KNP Logistics enters administration with 730 jobs lost
The real world consequences of cybercrime have been revealed, after a veteran transportation firm in the UK collapsed after a devastating ransomware attack in the summer.
Kettering-based KNP Logistics group was the parent company of the 158-year-old haulage firm Knights of Old (which was founded in 1865).
The BBC reported it has entered administration, after it was targetted in June by a major ransomware attack that impacted key systems, processes and financial information.
The BBC also reported joint administrators Rajnesh Mittal and Philip Armstrong of FRP Advisory Trading Limited as saying that about 730 employees would be made redundant.
The administrators also reportedly said June’s cyber attack had damaged KNP Logistic Group’s financial position and its ability to secure additional investment and funding.
“Despite being one of the UK’s largest privately owned logistics group, KNP fell victim of a ransomware attack earlier this year that caused significant disruption,” joint administrator, Mittal, was quoted by the BBC as saying.
“Against a backdrop of challenging market conditions and without being able to secure urgent investment due to the attack, the business was unable to continue,” Mittal added. “We will support all affected staff through this difficult time.”
KNP Logistics had been one of the United Kingdom’s largest privately owned logistics groups.
Hundreds of jobs
William Wright, CEO of Scottish cybersecurity specialist Closed Door Security, noted how a ransomware attack could cause the bankruptcy of a logistics veteran and the loss of hundreds of jobs.
“It is devastating to see a ransomware attack shatter an organisation in this way, putting a renowned and decade-old business out of operation, while impacting hundreds of families across the UK because of job losses,” said Wright.
“When thinking about the threat of cybercrime, very few people understand just how bad things can be, but this is an example of the harsh, yet very real, consequences of attacks,” said Wright. “Sometimes the financial and data losses, and business downtime are irreparable.”
“In response to the news about KNP Logistics, it is essential other organisations take action to improve their defences against attacks to prevent ever being placed in this devastating position,” said Wright.
“These defences must be layered and proactive – reaction is not the goal,” Wright advised. “Organisations must constantly test and update their systems for vulnerabilities and actively patch them, they must train staff on attacker techniques, and they must implement tools which stop intruders reaching corporate assets or spreading through their networks.”
This not the first time that a ransomware attack has closed down a business.
In May 2022 it emerged that Lincoln College, a private college in the US state of Illinois, was to close its doors permanently after 157 years since its foundation.
The further education establishment had been founded in 1865, and survived multiple disasters, including a major campus fire in 1912, the Spanish flu, the Great Depression, the World Wars, and the 2008 global financial crisis.
But a ransomware attack in December 2021 was so damaging, that the college announced that it was shutting down permanently on Friday 13 May 2022. The Covid-19 pandemic also played a role in the closure.