Ransomware Attack on Data Hub Forces NEPSE to Halt Monday Trading, Putting 8 Million Investors at Risk
A ransomware attack on Data Hub Pvt Ltd, which hosts the Trade Management Systems (TMS) for 72 brokerage firms, forced the Nepal Stock Exchange (NEPSE) to suspend all secondary market trading on Monday. The exchange invoked Rule 21(1) of the Securities Listing and Trading Regulations, 2018, to halt transactions, raising serious concerns among approximately 8 million investors in a market now valued at over Rs 4.553 trillion.
KATHMANDU, Sept 21 — The Nepal Stock Exchange (NEPSE) has confirmed that stock trading on Monday was shut down following a ransomware attack on the infrastructure of Data Hub Pvt Ltd, the vendor that hosts servers for the Trade Management Systems (TMS) of 72 brokerage firms.
Expressing concern over the technical glitches observed across trading platforms, the frontline regulator suspended all transactions in the secondary market for the entire day. According to Data Hub, the ransomware attack was detected in its system at 5:30 am on Sunday.
"We have secured and isolated the backup system due to this issue," the company said in a released statement.
The attack specifically targeted the infrastructure hosting the TMS for the 72 brokerage companies. Data Hub reported that the ransomware was suspected to have affected or propagated to other connected networks and systems. As a precautionary measure, potentially affected networks and systems have been kept isolated.
The company added that it is conducting an investigation and forensic analysis to determine the full impact of the incident and is implementing necessary security and recovery measures.
NEPSE Spokesperson Murahari Parajuli confirmed that the exchange halted Monday's trading to safeguard investors from possible misconduct on the trading platform. "As problems surfaced in Data Hub's infrastructure, we have isolated the system from possible hacker attacks," he said.
NEPSE issued a notice stating that Monday's trading had been suspended in accordance with Rule 21(1) of the Securities Listing and Trading Regulations, 2018. Under this rule, NEPSE holds the authority to suspend or halt regular share trading in the event of special circumstances, technical issues, or systemic risks.
Parajuli noted that NEPSE decided to close trading on Monday after concerned stockbrokers requested a halt for the day, citing possible threats to NEPSE's trading system as well.
The recurring technical glitches in the NEPSE system have raised concerns among the approximately 8 million investors involved in stock trading. According to one investor, at a time when the stock market has grown to a size of more than Rs 4.553 trillion, government authorities must show serious concern for the smooth operation of the trading platform to ensure investors' safety.