June cyber attack could cost FedEx millions of dollars

MEMPHIS, TN (WMC) - FedEx is still reeling from a cyber attack on a subsidiary the company recently purchased.

The cyber attack happened in June, but FedEx issued a statement Monday saying the attack will cost the company a lot of money.

FedEx acquired Netherlands-based TNT Express in May 2016. One month later, an international cyber attack devastated the company.

No other FedEx systems were compromised, but FedEx continues to struggle getting TNT Express fully operational.

"It can happen to anyone, from a one person office to a multi-conglomerate like FedEx," Mike Brady, of Memphis-based Cyber Solutions Group, said.

FedEx did not say exactly how much the cyber attack will cost the company, but Brady said it's not going to be cheap.

"For somebody like FedEx, it could be in the millions. I've seen other smaller companies even have to pay tens of thousands of dollars," he said.

FedEx said the company didn't have time to get cyber insurance to cover the attack on TNT Express. Therefore, FedEx will have to pay the cost completely out of pocket.

Shares of FedEx fell 3.4 percent Monday morning, but recovered about half by the close of trading.

FedEx said in a regulatory filing that the June 27 attack was causing lost revenue and higher costs for Netherlands-based TNT, which FedEx bought for $4.8 billion last year.

The so-called Petya attack spread a virus through a Ukrainian tax-software product that was used by TNT. FedEx said that all TNT facilities were running but many tasks were being performed manually and customers were experiencing delays.

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