Hacking Scandal Sinks DigiNotar

DigiNotar's hacking scandal has sunk the company for good its parent company VASCO said in a filing recently.

The Zurich, Switzerland based company supplied digital certificates to authenticate websites, including a few government based. A hacker recently infiltrated its Certificate Authority (CA) infrastructure which led to the fraudulent issuance of public key certificate requests for a number of domains, including Google.com and many others. The incident led to Google, Microsoft and many others black-listing the company as well as the Dutch government taking over its operations temporarily.

The hammer has fallen down from the incident and DigiNotar has been forced to file for bankruptcy at the Haarlem District Court in The Netherlands as a result of the hacking incident. The court then declared the company bankrupt. VASCO, the Oakbrook Terrace, Ill. based parent company of DigiNotar, said it is still assessing damages and has taken over management of its business activities.

VASCO seemed to try and distance itself from the DigiNotar disaster with statements made by its CEO and Chairman, T. Kendall Hunt.

Although we are saddened by this action and the circumstances that necessitated it, we would like to remind our customers and investors that the incident at DigiNotar has no impact on VASCO's core authentication technology. The technological infrastructures of VASCO and DigiNotar remain completely separated, meaning that there is no risk for infection of VASCO's strong authentication business, Hunt said.

VASCO's chief said the damages from the hack are expected to be significant. It is working with the court to assess the damages.

A hacker by the name of Comodohacker claimed responsibility for the DigiNotar hacks. He blamed the Dutch government for failing to Srebrenica genocide, which occurred 16 years ago. Comodohacker got his name last March when he hacked a Comodo reseller.

Graham Cluey, senior technology consultant at Sophos, said not too many people will feel badly for DigiNotar.

It's unlikely that many people are going to shed many tears over the demise of DigiNotar. The firm lost all trust when when it was discovered that it had known that it had suffered a security breach weeks before coming clean about the problem, Cluey said in a blog post. But it does serve as a chilling reminder of just how fatal a hack can be for an organization, especially if the way your corporation decides to respond to it is woefully insufficient.

Follow Gabriel Perna on Twitter at @GabrielSPerna