Swiss Cybersecurity and encryption firm Crypto International has confirmed it dismissed 70 employees as a result of an export license suspension suspected to be related to concerns about its scandal-embroiled acquisition, Crypto AG. Now, it’s pivoting to telecommunications and consumer electronic goods as it distances itself from Crypto AG.
The company’s owners Emma and Andreas Linde reportedly said that assumed connections between the two firms led to an export ban on the company after the news broke in December that Crypto AG was secretly owned by the CIA. The CIA-operated Crypto AG reportedly worked with the agency and German intelligence, providing confidential services related to its encryption devices which were sold to governments and companies worldwide. Swiss authorities have launched an investigation into the affair.
However, despite its 2018 acquisition and status as the firm’s successor company, Crypto International’s website states that the two firms are separate. It is in the process of rebranding to present a new identity to further distance it from Crypto AG.
“All products mentioned in the news stories were developed and put on the market by Crypto AG before 1990. We are a completely different company, founded almost 30 years later.”
The couple registered a new company, Asperiq AG, right after the announcement of the job losses. The new company will manufacture telecommunications and consumer electronic goods rather than cybersecurity services. Information regarding the owners or shareholder details hasn’t been disclosed. However, it has formed a board of directors and a management team which consists of four people, according to the report.
Still, its current business has been hit hard by the economics ministry’s decision to revoke its export license in February. Since then, the company has taken the more time consuming route of applying for single export licenses, according to the firm’s site. But, the company said that the government’s refusal to recommence an inspection of export applications recently made the dismissals “unavoidable,” according to the report. The Lindes further stated that the company lost its main source of income due to the “inaction of the authorities.”
“We have not yet received a sufficient explanation as to why our license has been suspended because of allegations against another company,” said the site’s statement.
Efforts were made to rescue the company and employees’ jobs, but the company has been unable to recover from losses related to the economic ministry suspension of the firm’s export permit. Further, the report said that the Swiss government too had placed orders with the company and received some deliveries.
Crypto International previously announced its plans to dismiss some employees in July, according to the report.
© 2020 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.