Nationalism Has Survived Globalization

Remarkable journalism by Bloomberg today:

Thousands of technology, finance and manufacturing companies are working closely with U.S. national security agencies, providing sensitive information and in return receiving benefits that include access to classified intelligence, four people familiar with the process said.

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Many of these same Internet and telecommunications companies voluntarily provide U.S. intelligence organizations with additional data, such as equipment specifications, that don’t involve private communications of their customers, the four people said.

Makers of hardware and software, banks, Internet security providers, satellite telecommunications companies and many other companies also participate in the government programs. In some cases, the information gathered may be used not just to defend the nation but to help infiltrate computers of its adversaries.

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Microsoft Corp., the world’s largest software company, provides intelligence agencies with information about bugs in its popular software before it publicly releases a fix, according to two people familiar with the process. That information can be used to protect government computers and to access the computers of terrorists or military foes.

Redmond, Washington-based Microsoft (MSFT) and other software or Internet security companies have been aware that this type of early alert allowed the U.S. to exploit vulnerabilities in software sold to foreign governments, according to two U.S. officials. Microsoft doesn’t ask and can’t be told how the government uses such tip-offs, said the officials, who asked not to be identified because the matter is confidential.

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Some U.S. telecommunications companies willingly provide intelligence agencies with access to facilities and data offshore that would require a judge’s order if it were done in the U.S., one of the four people said.

In these cases, no oversight is necessary under the Foreign Intelligence Surveillance Act, and companies are providing the information voluntarily.

The extensive cooperation between commercial companies and intelligence agencies is legal and reaches deeply into many aspects of everyday life, though little of it is scrutinized by more than a small number of lawyers, company leaders and spies. Company executives are motivated by a desire to help the national defense as well as to help their own companies, said the people, who are familiar with the agreements.

Most of the arrangements are so sensitive that only a handful of people in a company know of them, and they are sometimes brokered directly between chief executive officers and the heads of the U.S.’s major spy agencies, the people familiar with those programs said.

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If necessary, a company executive, known as a “committing officer,” is given documents that guarantee immunity from civil actions resulting from the transfer of data. The companies are provided with regular updates, which may include the broad parameters of how that information is used.
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The information provided by Snowden also exposed a secret NSA program known as Blarney. As the program was described in the Washington Post (WPO), the agency gathers metadata on computers and devices that are used to send e-mails or browse the Internet through principal data routes, known as a backbone. That metadata includes which version of the operating system, browser and Java software are being used on millions of devices around the world, information that U.S. spy agencies could use to infiltrate those computers or phones and spy on their users.
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U.S telecommunications, Internet, power companies and others provide U.S. intelligence agencies with details of their systems’ architecture or equipment schematics so the agencies can analyze potential vulnerabilities.

“It’s natural behavior for governments to want to know about the country’s critical infrastructure,” said Chisholm, chief security officer at Irvine, California-based Cylance Inc.

Even strictly defensive systems can have unintended consequences for privacy. Einstein 3, a costly program originally developed by the NSA, is meant to protect government systems from hackers. The program, which has been made public and is being installed, will closely analyze the billions of e-mails sent to government computers every year to see if they contain spy tools or malicious software.

Einstein 3 could also expose the private content of the e-mails under certain circumstances, according to a person familiar with the system, who asked not to be named because he wasn’t authorized to discuss the matter.

So, regardless of how much US companies make outside the US, loyalties remain to their home countries.  This is why we know better than allowing Huawei into this country’s telecommunications networks.

Booz’s Law versus Moore’s Law

It’s amazing how defense/intelligence technology and “Silicon Valley” technology travel on completely parallel highways.

Last year, I wrote about how the former was driven by contractor economics rather than effectiveness, while the latter took advantage of Moore’s Law.  The results, such as the trillions of dollars in overruns with the F-35 are stunning.

That same distinction is being replicated in the cyber defense world as the contractors try to get their piece of the pie.

Compare these descriptions of two approaches in Wired:

The Contractors:

What’s good for Alexander is good for the fortunes of the cyber-industrial complex, a burgeoning sector made up of many of the same defense contractors who grew rich supplying the wars in Iraq and Afghanistan. With those conflicts now mostly in the rearview mirror, they are looking to Alexander as a kind of savior. After all, the US spends about $30 billion annually on cybersecurity goods and services.

In the past few years, the contractors have embarked on their own cyber building binge parallel to the construction boom at Fort Meade: General Dynamics opened a 28,000-square-foot facility near the NSA; SAIC cut the ribbon on its new seven-story Cyber Innovation Center; the giant CSC unveiled its Virtual Cyber Security Center. And at consulting firm Booz Allen Hamilton, where former NSA director Mike McConnell was hired to lead the cyber effort, the company announced a “cyber-solutions network” that linked together nine cyber-focused facilities. Not to be outdone, Boeing built a new Cyber Engagement Center.

The Silicon Valley way:

One of the most secretive of these contractors is Endgame Systems, a startup backed by VCs including Kleiner Perkins Caufield & Byers, Bessemer Venture Partners, and Paladin Capital Group..

Perhaps for good reason: According to news reports, Endgame is developing ways to break into Internet-connected devices through chinks in their antivirus armor. Like safecrackers listening to the click of tumblers through a stethoscope, the “vulnerability researchers” use an extensive array of digital tools to search for hidden weaknesses in commonly used programs and systems, such as Windows and Internet Explorer. And since no one else has ever discovered these unseen cracks, the manufacturers have never developed patches for them.

Thus, in the parlance of the trade, these vulnerabilities are known as “zero-day exploits,” because it has been zero days since they have been uncovered and fixed. They are the Achilles’ heel of the security business, says a former senior intelligence official involved with cyberwarfare. Those seeking to break into networks and computers are willing to pay millions of dollars to obtain them.

According to Defense News’ C4ISR Journal and Bloomberg Businessweek, Endgame also offers its intelligence clients—agencies like Cyber Command, the NSA, the CIA, and British intelligence—a unique map showing them exactly where their targets are located. Dubbed Bonesaw, the map displays the geolocation and digital address of basically every device connected to the Internet around the world, providing what’s called network situational awareness. The client locates a region on the password-protected web-based map, then picks a country and city— say, Beijing, China. Next the client types in the name of the target organization, such as the Ministry of Public Security’s No. 3 Research Institute, which is responsible for computer security—or simply enters its address, 6 Zhengyi Road. The map will then display what software is running on the computers inside the facility, what types of malware some may contain, and a menu of custom-designed exploits that can be used to secretly gain entry. It can also pinpoint those devices infected with malware, such as the Conficker worm, as well as networks turned into botnets and zombies— the equivalent of a back door left open.

One approach eats up the cash; the other delivers results.

Tit for Tat (CyberWarfare edition)

No commentary, other than Cyberwarfare is asymmetric and empowering of the weaker party.  From a great piece in Wired:

Us:

The cyberweapon that came to be known as Stuxnet was created and built by the NSA in partnership with the CIA and Israeli intelligence in the mid-2000s. The first known piece of malware designed to destroy physical equipment, Stuxnet was aimed at Iran’s nuclear facility in Natanz. By surreptitiously taking control of an industrial control link known as a Scada (Supervisory Control and Data Acquisition) system, the sophisticated worm was able to damage about a thousand centrifuges used to enrich nuclear material…

n 2006, the Department of Defense gave the go-ahead to the NSA to begin work on targeting these centrifuges, according to The New York Times. One of the first steps was to build a map of the Iranian nuclear facility’s computer networks. A group of hackers known as Tailored Access Operations—a highly secret organization within the NSA—took up the challenge.

They set about remotely penetrating communications systems and networks, stealing passwords and data by the terabyte. Teams of “vulnerability analysts” searched hundreds of computers and servers for security holes, according to a former senior CIA official involved in the Stuxnet program. Armed with that intelligence, so-called network exploitation specialists then developed software implants known as beacons, which worked like surveillance drones, mapping out a blueprint of the network and then secretly communicating the data back to the NSA. (Flame, the complex piece of surveillance malware discovered by Russian cybersecurity experts last year, was likely one such beacon.) The surveillance drones worked brilliantly. The NSA was able to extract data about the Iranian networks, listen to and record conversations through computer microphones, even reach into the mobile phones of anyone within Bluetooth range of a compromised machine.

Them:

Sure enough, in August 2012 a devastating virus was unleashed on Saudi Aramco, the giant Saudi state-owned energy company. The malware infected 30,000 computers, erasing three-quarters of the company’s stored data, destroying everything from documents to email to spreadsheets and leaving in their place an image of a burning American flag, according to The New York Times. Just days later, another large cyberattack hit RasGas, the giant Qatari natural gas company. Then a series of denial-of-service attacks took America’s largest financial institutions offline. Experts blamed all of this activity on Iran, which had created its own cyber command in the wake of the US-led attacks. James Clapper, US director of national intelligence, for the first time declared cyberthreats the greatest danger facing the nation, bumping terrorism down to second place. In May, the Department of Homeland Security’s Industrial Control Systems Cyber Emergency Response Team issued a vague warning that US energy and infrastructure companies should be on the alert for cyberattacks. It was widely reported that this warning came in response to Iranian cyberprobes of industrial control systems. An Iranian diplomat denied any involvement.

That Giant Sucking Sound

that you hear is the government spying on all your data and Silicon Valley bending over and making it easy.

(Good on Twitter and @dickc and @amac for resisting so far.)

 

 

 

 

 

 

 

 

Assymetric Cyber Warfare

The theft of intellectual property is not the only motivation for cyber attacks.  Indeed, while theft happens in the shadows and is often meant to remain in the shadows; political hackers are aiming to make a statement and to be noticed.

It is a statement that the weak can hurt the strong.

In recent weeks, the hacked AP tweet that announced the false news of a White House attack by a Syrian hacker “army” momentarily knocked off hundreds of billions of dollars of stock value.  It was a demonstration of the reality and effects of the use of cyber attacks to conduct asymmetric warfare.

An example overlooked by many was the attack on Aramco last August that knocked out a vast part of its computer network.  The attack took out over 30,000 computers, damaging hardware and software.  It was intended to affect production.  While this one largely was contained, as can be extrapolated by oil price spikes from production outages of minor players in the world of oil, a successful attack on Aramco would throw a much bigger wrench into the global economy.