The U.S. Ban on Kaspersky Generates Its First Casualty: All Employees in the Country Will Be Laid Off

On June 20, the Biden administration announced a ban on Kaspersky in the U.S. The Russian cybersecurity company initially planned to challenge the restriction, but it’s now confirmed that it’ll be leaving the U.S. market.

The closure of Kaspersky’s operations in the country will happen gradually. According to CNN, the company has stated that it “has carefully examined and evaluated the impact of U.S. legal requirements and made this sad and difficult decision as business opportunities in the country are no longer viable.”

50 Employees Will Be Laid Off

When U.S. authorities announced the ban on Kaspersky, its impact was initially unclear. The ban set a July 20 deadline for selling software products but didn’t address other revenue streams, such as offering cyber threat intelligence training.

It’s now evident that the company will stop operating in the U.S. after nearly two decades. This primarily affects Kaspersky North America, a subsidiary founded in 2004 with offices in Massachusetts, reporting to its UK-based parent company, Kaspersky Labs Limited, which is connected to its headquarters in Moscow.

According to The Register, Kaspersky will lay off 50 employees in stages starting later this week. The company has stated that it remains committed to cybersecurity but will focus on investing in other strategic markets.

The Department of Commerce is behind this ban, having conducted a lengthy investigation into Kaspersky and holding talks with the company to address security concerns.

In the Commerce Department's resolution, Kaspersky proposed to modify its corporate structure without giving up its parent company in Russia. However, this didn’t convince U.S. authorities, who pointed out that Kaspersky’s operations would remain subject to Russian laws requiring its companies to cooperate with intelligence agencies. The U.S. said this posed “undue or unacceptable risks.”

“Russia has shown it has the capacity, and even more than that, the intent to exploit Russian companies like Kaspersky to collect and weaponize the personal information of Americans,” Commerce Secretary Gina Raimondo told reporters after the ban was announced.

Despite the ban, Kaspersky is considered one of the most outstanding security companies in the sector. It has received several awards, including the “Product of the Year” from AV-Comparatives, a top independent organization that assesses antivirus software. Its researchers also have a reputation for uncovering cybercriminal operations around the world.

This article was written by Javier Marquez and originally published in Spanish on Xataka.

Image | Paul Weaver | Kaspersky

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