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EMC spends $66 million to clean up RSA SecureID mess

03 August 2011

The March data breach affecting RSA’s SecureID two-factor authentication product has cost parent company EMC $66 million so far, the company admitted during its second-quarter 2011 earnings call.

The company has spent the $66 million on transaction monitoring and token replacement for its corporate customers, said David Goulden, EMC’s chief financial officer.

In response to a cyberattack at defense contractor Lockheed Martin tied to the SecureID breach, RSA offered in June to replace compromised tokens for high-risk customers.

“It is important for customers to understand that the attack on Lockheed Martin does not reflect a new threat or vulnerability in RSA SecurID technology. Indeed, the fact that the only confirmed use to date of the extracted RSA product information involved a major U.S. defense contractor only reinforces our view on the motive of this attacker”, RSA executive chairman Art Coviello said in announcing the token exchange offer.

During the July 20 second-quarter earnings call, EMC’s Goulden was quoted by the Washington Post as saying: “We incurred an accrued cost associated with investigating the attack, hardening our systems and working with customers to implement our remediation programs.

Goulden also revealed that RSA alerted customers within hours of the RSA intrusion and suspects that the company was targeted for information on its defense and government agencies, not for financial information.

In spite of the RSA breach, EMC reported strong second-quarter financial results. Second-quarter consolidated revenue was $4.85 billion, an increase of 20% compared with the year-ago quarter. Second-quarter GAAP net income attributable to EMC increased 28% year-over-year to $546 million.

This article is featured in:
Data Loss  •  Internet and Network Security


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