According to this new article on ReadyToBeServed.com, a flaw in the PHPNuke software allowed a malicious user access to a server to cause all sorts of headaches for both the hosting company and the others hosted on that machine.

A Wellington, New Zealand, Web hosting company may seek compensation from a client that it claims is responsible for the worst hacking attack in the company's history. IServe blames lax security on their client's part for the hacking job that resulted in the defacing of hundreds of Websites.

The hack forced iServe to shut down all its FTP servers for 28 hours, while it replaced many of its customers' websites with back-ups that were made a few days before the incident.

Joy Cottle, iServe's general manager estimates the problem cost about $20,000 to repair. Clients with dedicated servers were not affected by the hack.

They report that the attack happened because of a flaw in the content management system that allowed the user to overwrite websites of other customers on the machine. They are even considering trying to recoup some of the costs from the customer that allowed it to happen. The hole was one found in the older version of PHPNuke the customer had uploaded.

Due to the incident, iServe is now considering banning cleints from running PHPNuke