A US minerals company, NioCorp Developments, disclosed that cybercriminals illegally accessed its systems on Valentine’s Day and redirected approximately $500,000 that was intended for a vendor. The intrusion, which resembles a business email compromise (BEC) scheme, involved breaching NioCorp’s information systems, including parts of its email network, to divert the funds.
The company took swift action upon discovering the cybersecurity breach and promptly informed relevant financial institutions and federal law enforcement authorities in an attempt to recover the misappropriated vendor payments. NioCorp also initiated an investigation to contain and mitigate the cybersecurity incident.
Although the extent of the attack appears limited to the redirected payment, ongoing investigations aim to ascertain any additional damage caused by the cyber attackers. NioCorp remains uncertain about the potential material impact of the incident on its financial condition and operations, including the possibility of recovering some or all of the misdirected funds.
When approached for further details, NioCorp did not immediately respond to inquiries. The company specializes in a minerals project located in Southeast Nebraska, focusing on extracting niobium, scandium, and titanium – critical minerals designated by the US government.
Niobium, a crucial element with diverse applications, strengthens various metals such as steel, making it valuable to industries like automotive and aviation. Scandium, classified as a rare earth element, enhances aluminum alloys used in aerospace components and specialized bicycles. Titanium, a widely utilized lightweight metal, faces supply constraints due to geopolitical factors, leading to increased demand in various sectors for its durability and strength.
Established in 1987 as Rare Earth Developments Corp., NioCorp operates as a development-stage company financed through debt and equity to advance its Elk Creek, Nebraska project. Despite not yet generating revenue from its anticipated mineral sales, the company faces financial implications from the cyber incident, especially considering its recent annual net loss of $11.4 million.
If unable to recover the misdirected funds, the $500,000 loss would account for nearly 4.5 percent of NioCorp’s annual net loss, posing challenges for the company’s financial stability. As investigations continue, NioCorp strives to address the cybersecurity breach effectively and safeguard its operations from further threats.