Manufacturing Firm Ransomware Attack
A 200-employee Midwest manufacturer paid $350K in ransom, spent $500K+ on recovery, and had their insurance claim denied — all because MFA wasn't enabled on their VPN.
The Attack
In late 2024, a mid-sized manufacturing company in the Midwest received what appeared to be a routine email from a supplier. An accounts payable employee clicked a link, entered credentials on a convincing phishing page, and unknowingly handed attackers the keys to the network.
The attackers used those stolen credentials to connect to the company's VPN. Because MFA wasn't enabled on remote access, a username and password was all they needed. Once inside, they spent 11 days conducting reconnaissance, escalating privileges, and positioning ransomware across critical systems.
On a Friday evening — a common tactic to maximize damage before IT staff could respond — they triggered the encryption. Production systems, ERP, file servers, and backups were all locked. The ransom demand: $350,000 in cryptocurrency.
$850,000+
Total cost: $350K ransom + $500K+ recovery, lost production, and remediation
The Damage
- 3 weeks of downtime — Production lines sat idle. Orders couldn't be processed. Customers went to competitors.
- $350,000 ransom paid — After failed recovery attempts, leadership made the difficult decision to pay.
- $500,000+ in recovery costs — Incident response, forensics, system rebuilding, legal fees, and customer communications.
- Customer relationships damaged — Several long-term customers moved to competitors during the outage.
- Insurance claim denied — The policy required MFA on all remote access. The company had attested to this on their application, but it wasn't actually implemented.
Why Insurance Denied the Claim
During the claims investigation, the insurer's forensics team discovered that MFA was not enabled on the VPN — despite the company attesting that it was on their insurance application.
This is called a "material misrepresentation." When you attest to having security controls that you don't actually have, insurers can (and do) deny claims. In this case, the company was left holding the entire $850K+ bill.
The lesson: Your insurance application isn't paperwork to rush through. It's a legal attestation. If you claim to have MFA, EDR, or tested backups — you need to actually have them, configured correctly, and working.
What Could Have Prevented This
- MFA on VPN and remote access — The single most impactful control. Even with stolen credentials, attackers can't get in without the second factor.
- Phishing-resistant authentication — Hardware security keys or passkeys that can't be phished.
- Security awareness training — Employees trained to recognize phishing attempts and report suspicious emails.
- Network segmentation — Limiting lateral movement so attackers can't reach critical systems from a compromised workstation.
- Immutable backups — Backups that can't be encrypted or deleted by attackers, tested regularly.
- EDR with 24/7 monitoring — Detection of the 11-day reconnaissance period before ransomware was deployed.
How RMA Would Have Helped
Before the attack:
- Foundation assessment would have identified the missing MFA as a critical gap
- Insurance readiness review would have caught the attestation mismatch
- Compliance gap analysis would have flagged backup and access control issues
Ongoing protection (Standard or Managed tier):
- Quarterly vulnerability assessments to catch configuration drift
- Security awareness training with phishing simulations
- Policy management ensuring controls match attestations
- 24/7 MDR would have detected the 11-day reconnaissance
Source
This case study is adapted from the Verizon 2025 Data Breach Investigations Report's analysis of the manufacturing sector, combined with publicly reported ransomware incidents and insurance claim denials.
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