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Kaspersky CEO says hack claims cutting U.S. cyber security sales
October 27, 2017 / 6:54 PM / 2 months ago

Kaspersky CEO says hack claims cutting U.S. cyber security sales

MOSCOW/WASHINGTON (Reuters) - Eugene Kaspersky told Reuters on Friday that the Moscow-based cyber security firm that bears his name would see a ‘single-digit’ drop in U.S. sales this year as a result of suspicions about his company’s ties to the Russian government, but its global revenue should still increase.

Eugene Kaspersky, Chief Executive of Russia's Kaspersky Lab, poses for a picture at the company's office in Moscow, Russia October 27, 2017. REUTERS/Maxim Shemetov

By turns frustrated and defiant in an 80-minute interview in his Moscow office, the founder and head of the embattled antivirus software maker denounced what he called an “information war” against his company, repeatedly asserting that “we’ve done nothing wrong.”

Kaspersky said the company’s interactions with law enforcement in Russia and elsewhere was “limited to cyber crime investigations, data sharing about cyber crime - that’s it.”

He added: “We have zero, zero wrong connections, contacts or assistance to espionage agencies. Zero.”

The interview was part of the global Reuters Cyber Security Summit. For other news from the summit, click www.reuters.com/cyberrisk

Founded in 1997, Kaspersky Lab boasts more than 400 million global customers. It has become a lightning rod in recent months as it faces allegations by the U.S. government that its antivirus products can be used by Russian spies to conduct cyber espionage.

The controversy surrounding the company reflects mounting fear and distrust of Russia over widespread allegations that it interfered in the U.S. presidential election and was behind a wave of destructive global hacking attacks.

Although it is one of the world’s leading suppliers of antivirus software, Kaspersky Lab has struggled to find success as a vendor to the U.S. government, one of the world’s largest buyers of cyber tools, amid long-running suspicions about the company.

Anton Shingarev, Kaspersky Lab’s vice president of public affairs, told Reuters during the interview the company had abandoned efforts to sell its services to the U.S. government and that it would wind down its Washington-area subsidiary, KGSS.

“It is pretty much impossible to sell to U.S. government these days, and we don’t have any plans to do that,” Shingarev said, adding that the federal agency market had been negligible for the company. He said the company was looking at switching KGSS employees to different roles in the company, such as enterprise and intelligence service sales.

Eugene Kaspersky, Chief Executive of Russia's Kaspersky Lab, speaks during an interview with Reuters in Moscow, Russia October 27, 2017. REUTERS/Maxim Shemetov

‘INFORMATION WAR’

U.S. President Donald Trump’s administration last month ordered Kaspersky’s products removed from U.S. government computers, citing concerns about Kremlin influence and saying the software could jeopardize national security.

Retailers Best Buy Co Inc (BBY.N) and Office Depot Inc (ODP.O) have also pulled Kaspersky products from their shelves.

Despite those setbacks, Kaspersky said he expected global revenue for his company to reach about $700 million in 2017. It reported $644 million in global revenue in 2016, according to unaudited figures under International Financial Reporting Standards.

Slideshow (8 Images)

The loss of sales in the United States would be “less than 10 percent,” Kaspersky said. “It’s because of this information war against our company, this is the main reason.”

Kaspersky Lab earlier this week confirmed reports that its security software had taken source code for a secret American hacking tool from a personal computer in the United States in 2014, an incident that has heightened suspicions about the company.

Eugene Kaspersky said the company had disposed of the code as soon as it learned that it was classified information.

Asked repeatedly why the U.S. government was cracking down on his company now, Kaspersky alternated between saying he did not know and that he had been caught in the middle of a “political situation” related to the deterioration of relations between Russia and the United States.

“We felt a cold wind started to blow in 2014,” he said, adding that he had not visited the United States since 2015 after doing so frequently because there are “more promising options in other nations.”

Kaspersky said he still wanted to testify before the U.S. Congress about his software but was waiting for lawmakers to extend another invite to him after cancelling a hearing last month to which he had been invited.

U.S. officials have often alleged Kaspersky has ties to Russia’s Federal Security Service (FSB), the main successor to the KGB. Eugene Kaspersky attended a KGB school and the company has acknowledged doing work for the agency but on Friday said it has only collaborated for law enforcement purposes.

Reporting by Jack Stubbs in Moscow, Dustin Volz in Washington, Alistair Sharp and Jim Finkle in Toronto and Joseph Menn in San Francisco; Editing by Jonathan Weber and Bill Rigby

Our Standards:The Thomson Reuters Trust Principles.
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