GMO to Reimburse Forex Users for Intrusion-Linked Trading Losses

GMO said it will reimburse users of お名前.com デスクトップクラウド for eligible losses from improper trades linked to a server intrusion, after one customer reported losing more than ¥6 million in a trading episode lasting nearly two minutes.

GMO announced the plan at 10:50 p.m. ET Oct. 23 (02:50 UTC Oct. 24). It will cover realized trading losses and fees when its investigation finds the improper orders resulted from the intrusion. The offer excludes market-related losses, missed profits and other indirect damages.

A 44-year-old office worker in Kanagawa Prefecture said his account lost more than ¥4 million in about two seconds on Oct. 21. The trades continued for nearly two minutes, taking his reported losses above ¥6 million.

The service leases Windows cloud servers for customers to run automated foreign-exchange trading tools. GMO said 26,739 servers may have been affected. The hosting disruption also coincided with delays to some OANDA Securities withdrawals.

GMO said the attacker demanded money and threatened to keep placing improper trades in customers’ accounts at more than 70 securities and foreign-exchange firms. The attacker also threatened to expose data on users’ computers and deploy ransomware, GMO said. The company refused to pay, saying payment would not ensure the data was deleted, and turned over its communications with the attacker to police’s cybercrime unit.

Customers must first ask their brokers to cancel improper trades or refund the amounts. GMO will account for any broker refunds and pay the remaining eligible amount.

Separately, GMO plans to give each current user ¥5,000, whether or not the user lost money. The company plans to email users about that payment by Oct. 30 and publish instructions for applying for loss reimbursement by Nov. 6.