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White House Cyber Defense Strategy

President Trump has issued America’s first cybersecurity strategy  in 15 Years.

According to the Director of National Security, Dan Coats,  It’s a measure of the growth of cyber and America’s vulnerability to it that cybers threat are at the top of the list of worldwide threats.

Coats revealed that “From U.S. businesses, to the federal government, to state and local governments, the United States is threatened by cyberattacks every day.” Russia, China, Iran and North Korea pose the greatest cyber threats, he said, but others use cyber operations to achieve strategic and malign objectives…Some of these actors, including Russia, are likely to pursue even more aggressive cyberattacks with the intent of degrading our democratic values and weakening our alliances.”

The Department of Defense notes that nonstate actors, which include terrorists and criminal syndicates, exploit weak state capacity in Africa, the Middle East, Asia and Latin America, to cause instability and violence within states and among states. A part of many of these malign actors is their use of cyber.  Coats reports that the United States is under attack by entities that are using cyber to penetrate virtually every major action that takes place in the United States.

According to Grant Schneider, Chief Information Security Officer and Senior Director for Cybersecurity Policy “Since the beginning of President Trump’s Administration, he has taken action to protect the American people in cyber space. Building on these strong efforts, [On September 20], the President signed the National Cyber Strategy—the first fully articulated cyber strategy for the United States since 2003. The National Cyber Strategy identifies decisive priority actions to protect the American people. This strategy makes clear that the Federal Government will never stop defending our interests, and that we will bring every element of American power to bear to protect our people in the digital domain. This Administration will not treat cyberspace as a separate arena. Instead, we are integrating cyber into all elements of national power. Structuring the National Cyber Strategy around the four pillars of the National Security Strategy reflects and advances and this approach.”

The White House document states that:

“The rise of the Internet and the growing centrality of cyberspace to all facets of the modern world corresponded with the rise of the United States as the world’s lone superpower. For the past quarter century, the ingenuity of the American people drove the evolution of cyberspace, and in turn, cyberspace has become fundamental to American wealth creation and innovation. Cyberspace is an inseparable component of America’s financial, social, government, and political life. Meanwhile, Americans sometimes took for granted that the supremacy of the United States in the cyber domain would remain unchallenged, and that America’s vision for an open, interoperable, reliable, and secure Internet would inevitably become a reality. Americans believed the growth of the Internet would carry the universal aspirations for free expression and individual liberty around the world. Americans assumed the opportunities to expand communication, commerce, and free exchange of ideas would be self-evident. Large parts of the world have embraced America’s vision of a shared and open cyberspace for the mutual benefit of all.

“Our competitors and adversaries, however, have taken an opposite approach. They benefit from the open Internet, while constricting and controlling their own people’s access to it, and actively undermine the principles of an open Internet in international forums. They hide behind notions of sovereignty while recklessly violating the laws of other states by engaging in pernicious economic espionage and malicious cyber activities, causing significant economic disruption and harm to individuals, commercial and non-commercial interests, and governments across the world. They view cyberspace as an arena where the United States’ overwhelming military, economic, and political power could be neutralized and where the United States and its allies and partners are vulnerable.
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“Russia, Iran, and North Korea conducted reckless cyber attacks that harmed American and international businesses and our allies and partners without paying costs likely to deter future cyber aggression. China engaged in cyber-enabled economic espionage and trillions of dollars of intellectual property theft. Non-state actors — including terrorists and criminals — exploited cyberspace to profit, recruit, propagandize, and attack the United States and its allies and partners, with their actions often shielded by hostile states. Public and private entities have struggled to secure their systems as adversaries increase the frequency and sophistication of their malicious cyber activities. Entities across the United States have faced cybersecurity challenges in effectively identifying, protecting, and ensuring resilience of their networks, systems, functions, and data as well as detecting, responding to, and recovering from incidents.”

These are the key tenets provided in the National Cyber Strategy document:

Protect the American People, the Homeland, and the American Way of Life. We will manage cybersecurity risks to increase the security and resilience of the Nation’s information and information systems. We will do this by taking specific steps to secure Federal networks and information, secure critical infrastructure, combat cybercrime, and improve incident reporting.

Promote American Prosperity. We will preserve America’s influence in the technological ecosystem and pursue development of cyberspace as an open engine of economic growth, innovation, and efficiency. To do this, we will support a vibrant and resilient digital economy, foster and protect American ingenuity, and develop a superior cybersecurity workforce.

Preserve Peace through Strength. We will identify, counter, disrupt, degrade, and deter behavior in cyberspace that is destabilizing and contrary to our national interests, while preserving America’s overmatch in and through cyberspace. To achieve this, we will do our part to enhance cyber stability through norms of responsible state behavior, attribution of unacceptable behavior in cyberspace, and the imposition of costs on malicious cyber actors.

Advance American Influence. We will preserve the long-term openness, interoperability, security, and reliability of the Internet, which supports and is reinforced by America’s interests. We will take specific global efforts to promote these objectives, while supporting market growth for infrastructure and emerging technologies and building cyber capacity internationally.

Photo: Army Staff Sgt. Matthew Malesinski, right, 201st Cyber Protection Team network security analyst, talks with his team during a cybersecurity audit of the 1st Combat Communications Squadron’s tactical communications kits at Ramstein Air Base, Germany, March 16, 2017. (Air Force photo by Staff Sgt. Timothy Moore)

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Russia Cyber-attacks U.S.

The FBI and Homeland Security (DHS) have announced that Russia repeatedly cyber-attacked America’s energy, water, aviation and manufacturing facilities.

The alert describes “indicators of compromise and technical details on the tactics, techniques, and procedures used by Russian government cyber actors on compromised victim networks.”

DHS and FBI characterize this attack as “a multi-stage intrusion campaign by Russian government cyber actors who targeted small commercial facilities’ networks where they staged malware, conducted spear phishing, and gained remote access into energy sector networks. After obtaining access, the Russian government cyber actors conducted network reconnaissance, moved laterally, and collected information pertaining to Industrial Control Systems (ICS). Since at least March 2016, Russian government cyber actors targeted government entities and multiple U.S. critical infrastructure sectors.”

Russia attacked two distinct categories of victims, according to the FBI and DHS:  staging and intended targets. “The initial victims are peripheral organizations such as trusted third-party suppliers with less secure networks, referred to as ‘staging targets.’ The threat actors used the staging targets’ networks as pivot points and malware repositories when targeting their final intended victims.”

Moscow used a variety of cyber tactics, including spear-phishing emails (from compromised legitimate account), watering-hole domains, credential gathering, open-source and network reconnaissance, host-based exploitation, and targeting industrial control system (ICS) infrastructure.

Russia’s cyber-soldiers used email attachments to leverage Microsoft Office functions for retrieving a document from a remote server using the Server Message Block (SMB) protocol. As a part of the standard processes executed by Microsoft Word, this request authenticates the client with the server, sending the user’s credential hash to the remote server before retrieving the requested file. After obtaining a credential hash, the threat actors can use password-cracking techniques to obtain the plaintext password. With valid credentials, the threat actors are able to masquerade as authorized users.
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Moscow was able to compromise the infrastructure of trusted organizations to reach intended targets. Approximately half of the known “watering holes” are trade publications and informational websites related to process control, ICS, or critical infrastructure. Although these watering holes may host legitimate content developed by reputable organizations, the Russians altered websites to contain and reference malicious content. They used legitimate credentials to access and directly modify the website content. The threat actors modified these websites by altering JavaScript and PHP files to request a file icon using SMB from an IP address controlled by the threat actors.

Throughout the tenure of the Obama Administration, acts of both physical and cyber aggression by America’s enemies were not responded to by the most pacifist presidency in U.S. history. There was virtually no substantive reaction by Obama to China’s incursion into the exclusive economic zone of the Philippines, or to Russia’s invasion of the Ukraine, or to the attack on the American facility in Benghazi which resulted in the death of a U.S. Ambassador. As China, Russia, and North Korea moved ahead at unprecedented levels in their armaments programs, Obama reduced spending on U.S. defenses.

The Obama Administration consistently failed to respond to Russian cyber attempts to target the U.S., both in terms of infrastructure as well as in the electoral process.  In 2014, Ali Watkins, writing for Politico,  reported “The Obama administration received multiple warnings from national security officials between 2014 and 2016 that the Kremlin was ramping up its intelligence operations and building disinformation networks it could use to disrupt the U.S. political system, according to more than half a dozen current and former officials…Politico spoke with more than a dozen current and former officials from across the national security spectrum, including intelligence agencies, the State Department and the Pentagon. Almost all said they were aware of Russia’s aggressive cyberespionage and disinformation campaigns … but felt that either the White House or key agencies were unwilling to act forcefully to counter the Russian actions. Intelligence officials ‘had a list of things they could never get the signoffs on,’ one intelligence official said. ‘The truth is, nobody wanted to piss off the Russians.’”

 

FBI illustration

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DHS, FBI Issue Cyber Attack Alert

The Department of Homeland Security (DHS) and the FBI haves issued an alert  on a threat involving an “advanced persistent threat (APT)…targeting government entities and organizations in the energy, nuclear, water, aviation, and critical manufacturing sectors. Working with U.S. and international partners, DHS and FBI identified victims in these sectors. “

According to DHS, the threat involves “a multi-stage intrusion campaign by threat actors targeting low security and small networks to gain access and move laterally to networks of major, high value asset owners within the energy sector. Based on malware analysis … DHS has confidence that this campaign is still ongoing, and threat actors are actively pursuing their ultimate objectives over a long-term campaign.”

The alert reports that since at least May 2017, threat actors have targeted government entities and the energy, water, aviation, nuclear, and critical manufacturing sectors, and, in some cases, have leveraged their capabilities to compromise victims’ networks. Historically, cyber threat actors have targeted the energy sector with various results, ranging from cyber espionage to the ability to disrupt energy systems in the event of a hostile conflict. Historically, threat actors have also targeted other critical infrastructure sectors with similar campaigns.”

The analysis identifies distinct indicators and behaviors related to this activity.

This campaign comprises two distinct categories of victims: staging and intended targets. The initial victims are peripheral organizations such as trusted third party (TTPs) suppliers with less secure networks. The threat actor uses the staging targets’ networks as pivot points and malware repositories when targeting their final intended victims. The ultimate objective of the cyber threat actors is to compromise organizational networks, which are referred throughout this alert as “intended target.”

The threat actors in this campaign employed a variety of third parties, including:

  • open-source reconnaissance,
  • spear-phishing emails (from compromised legitimate accounts),
  • watering-hole domains,
  • host-based exploitation,
  • industrial control system (ICS) infrastructure targeting, and
  • ongoing credential gathering.

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Writing for the website InfoSecurity, Tara Seals reports that “Industrial control systems (ICS) and critical infrastructure are common targets for cybercrime, with almost 40% of them facing a cyber-attack at some point in the second half of last year. According to Kaspersky Lab ICS research, the percentage of industrial computers under attack grew from 17% in July 2016 to more than 24% in December 2016. Every fourth targeted-attack detected by Kaspersky Lab in 2016 was aimed at industrial targets. The top three sources of infection were the internet, removable storage devices, and malicious email attachments and scripts embedded in the body of emails.”

The threat has been escalating for several years. Forbes’ Michael Assante disclosed in 2014 that “America’s critical infrastructure—the utilities, refineries, military defense systems, water treatment plants and other facilities on which we depend every day—has become its soft underbelly, the place where we are now most vulnerable to attack. Over the past 25 years, hundreds of thousands of analog controls in these facilities have been replaced with digital systems. Digital controls provide facility operators and managers with remote visibility and control over every aspect of their operations, including the flows and pressures in refineries, the generation and transmission of power in the electrical grid, and the temperatures in nuclear cooling towers. In doing so, they have made industrial facilities more efficient and more productive. But the same connectivity that managers use to collect data and control devices allows cyber attackers to get into control system networks to steal sensitive information, disrupt processes, and cause damage to equipment. Hackers, including those in China, Russia and the Middle East, have taken notice. While early control system breaches were random, accidental infections, industrial control systems today have become the object of targeted attacks by skilled and persistent adversaries.”

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The Cyber Threat

Speaking at the 2015 USSTRATCOM Deterrence Symposium recently, Dr. Brad Roberts, who served as  Deputy Assistant Secretary of Defense for Nuclear and Missile Defense Policy in the first Obama Administration, stated that cyber warfare capability is a key operational concept.

The New York Analysis of Policy & Budget reported in 2013 that “America faces a number of cyberspace threats. The most serious are from those wishing to engage in espionage to steal both military and technological secrets, and from those who wish to turn the nation’s own computer systems against it by dismantling defense systems and committing sabotage against key civilian infrastructure. Cyber attacks have escalated by 1,700% since 2009, costing intellectual property theft losses over $400 billion.

An armed attack following a cyber assault would be exceptionally effective. Key defense systems could be disabled, leading to a military that is deaf, dumb, and blind, defending a nation that may have its electrical, energy, water, transportation and other crucial systems heavily disrupted.

General Keith Alexander, the former commander of the U.S. Cyber Command, openly worried that the United States was not adequately prepared for a cyber attack. He noted that on a scale of  one to ten in preparedness, the U.S. was at about a three. He emphasized that the time to stop a cyber attack is less than a minute–far less time than preparing for an incoming missile attack.”

The Fireeye organization ‘s report, “Gazing into the Cyber Security Future” notes that “As the technology landscape evolves and attackers continue to adapt, we’re going to see new vulnerabilities to mobile, new operating systems and the cloud—and new ways for attackers to exploit these weaknesses. Preventing every breach is impossible.”

James R. Clapper, the Director of National Intelligence, reviewed  the 2015 cyber threat environment:

“Cyber threats to US national and economic security are increasing in frequency, scale, sophistication, and severity of impact. The ranges of cyber threat actors, methods of attack, targeted systems, and victims are also expanding. Overall, the unclassified information and communication technology (ICT) networks that support US Government, military, commercial, and social activities remain vulnerable to espionage and/or disruption. However, the likelihood of a catastrophic attack from any particular actor is remote at this time. Rather than a “Cyber Armageddon” scenario that debilitates the entire US infrastructure, we envision something different. We foresee an ongoing series of low-to-moderate level cyber attacks from a variety of sources over time, which will impose cumulative costs on US economic competitiveness and national security.

  • A growing number of computer forensic studies by industry experts strongly suggest that several nations—including Iran and North Korea—have undertaken offensive cyber operations against private sector targets to support their economic and foreign policy objectives, at times concurrent with political crises.

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Risk. Despite ever-improving network defenses, the diverse possibilities for remote hacking intrusions, supply chain operations to insert compromised hardware or software, and malevolent activities by human insiders will hold nearly all ICT systems at risk for years to come. In short, the cyber threat cannot be eliminated; rather, cyber risk must be managed. Moreover, the risk calculus employed by some private sector entities does not adequately account for foreign cyber threats or the systemic interdependencies between different critical infrastructure sectors.

Costs. During 2014, we saw an increase in the scale and scope of reporting on malevolent cyber activity that can be measured by the amount of corporate data stolen or deleted, personally identifiable information (PII) compromised, or remediation costs incurred by US victims.

For example:

  • After the 2012-13 distributed denial of service (DDOS) attacks on the US financial sector, JPMorgan Chase (JPMorgan) announced plans for annual cyber security expenditures of $250 million by the end of 2014. After the company suffered a hacking intrusion in 2014, JPMorgan’s CEO said he would probably double JPMorgan’s annual computer security budget within the next five years.
  • The 2014 data breach at Home Depot exposed information from 56 million credit/debit cards and 53 million customer email addresses. Home Depot estimated the cost of the breach to be $62 million.
  • In 2014, unauthorized computer intrusions were detected on the networks of the Office of Personnel Management (OPM) as well as its contractors, US Investigations Services (USIS) and KeyPoint 2 Government Solutions. The two contractors were involved in processing sensitive PII related to national security clearances for Federal Government employees.
  • In August 2014, the US company, Community Health Systems, informed the Securities and Exchange Commission that it believed hackers “originating from China” had stolen PII on 4.5 million individuals.

Attribution. Although cyber operators can infiltrate or disrupt targeted ICT networks, most can no longer assume that their activities will remain undetected. Nor can they assume that if detected, they will be able to conceal their identities. Governmental and private sector security professionals have made significant advances in detecting and attributing cyber intrusions.

  • In May 2014, the US Department of Justice indicted five officers from China’s Peoples’ Liberation Army on charges of hacking US companies.
  • In December 2014, computer security experts reported that members of an Iranian organization were responsible for computer operations targeting US military, transportation, public utility, and other critical infrastructure networks.

Deterrence. Numerous actors remain undeterred from conducting economic cyber espionage or perpetrating cyber attacks. The absence of universally accepted and enforceable norms of behavior in cyberspace has contributed to this situation. The motivation to conduct cyber attacks and cyber espionage will probably remain strong because of the relative ease of these operations and the gains they bring to the perpetrators. The result is a cyber environment in which multiple actors continue to test their adversaries’ technical capabilities, political resolve, and thresholds. The muted response by most victims to cyber attacks has created a permissive environment in which low-level attacks can be used as a coercive tool short of war, with relatively low risk of retaliation. Additionally, even when a cyber attack can be attributed to a specific actor, the forensic attribution often requires a significant amount of time to complete. Long delays between the cyber attack and determination of attribution likewise reinforce a permissive environment.

Threat Actors:  Politically motivated cyber attacks are now a growing reality, and foreign actors are reconnoitering and developing access to US critical infrastructure systems, which might be quickly exploited for disruption if an adversary’s intent became hostile. In addition, those conducting cyber espionage are targeting US government, military, and commercial networks on a daily basis. These threats come from a range of actors, including: (1) nation states with highly sophisticated cyber programs (such as Russia or China), (2) nations with lesser technical capabilities but possibly more disruptive intent (such as Iran or North Korea), (3) profit-motivated criminals, and (4) ideologically motivated hackers or extremists. Distinguishing between state and non-state actors within the same country is often difficult—especially when those varied actors actively collaborate, tacitly cooperate, condone criminal activity that only harms foreign victims, or utilize similar cyber tools.

Russia. Russia’s Ministry of Defense is establishing its own cyber command, which—according to senior Russian military officials—will be responsible for conducting offensive cyber activities, including  propaganda operations and inserting malware into enemy command and control systems. Russia’s armed forces are also establishing a specialized branch for computer network operations.

  • Computer security studies assert that unspecified Russian cyber actors are developing means to access industrial control systems (ICS) remotely. These systems manage critical infrastructures such as electric power grids, urban mass-transit systems, air-traffic control, and oil and gas distribution networks. These unspecified Russian actors have successfully compromised the product supply chains of three ICS vendors so that customers download exploitative malware directly from the vendors’ websites along with routine software updates, according to private sector cyber security experts.

China. Chinese economic espionage against US companies remains a significant issue. The “advanced persistent threat” activities continue despite detailed private sector reports, public indictments, and US demarches, according to a computer security study. China is an advanced cyber actor; however, Chinese hackers often use less sophisticated cyber tools to access targets. Improved cyber defenses would require hackers to use more sophisticated skills and make China’s economic espionage more costly and difficult to conduct.

Iran. Iran very likely values its cyber program as one of many tools for carrying out asymmetric but proportional retaliation against political foes, as well as a sophisticated means of collecting intelligence. Iranian actors have been implicated in the 2012-13 DDOS attacks against US financial institutions and in the February 2014 cyber attack on the Las Vegas Sands casino company.

North Korea. North Korea is another state actor that uses its cyber capabilities for political objectives. The North Korean Government was responsible for the November 2014 cyber attack on Sony Pictures Entertainment (SPE), which stole corporate information and introduced hard drive erasing malware into the company’s network infrastructure, according to the FBI. The attack coincided with the planned release of a SPE feature film satire that depicted the planned assassination of the North Korean president.

Terrorists. Terrorist groups will continue to experiment with hacking, which could serve as the foundation for developing more advanced capabilities. Terrorist sympathizers will probably conduct low level cyber attacks on behalf of terrorist groups and attract attention of the media, which might exaggerate the capabilities and threat posed by these actors.

Integrity of Information

Most of the public discussion regarding cyber threats has focused on the confidentiality and availability of information; cyber espionage undermines confidentiality, whereas denial-of-service operations and data deletion attacks undermine availability. In the future, however, we might also see more cyber operations that will change or manipulate electronic information in order to compromise its integrity (i.e. accuracy and reliability) instead of deleting it or disrupting access to it. Decision making by senior government officials (civilian and military), corporate executives, investors, or others will be impaired if they cannot trust the information they are receiving.

  • Successful cyber operations targeting the integrity of information would need to overcome any institutionalized checks and balances designed to prevent the manipulation of data, for example, market monitoring and clearing functions in the financial sector.

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U.S. unprepared for cyber attack

According to Dr. Daniel Goure, “The United States is woefully unprepared to deal with the inevitability of a major cyber attack.”

Writing for the Lexington Institute,  Dr. Goure notes that hacks of companies such as Sony, Home Depot, and Target are mere warnings of much greater dangers to come.

The Department of Homeland Security  emphasizes that “Our daily life, economic vitality, and national security depend on a stable, safe, and resilient cyberspace. We rely on this vast array of networks to communicate and travel, power our homes, run our economy, and provide government services. Yet cyber intrusions and attacks have increased dramatically over the last decade, exposing sensitive personal and business information, disrupting critical operations, and imposing high costs on the economy.”
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According to the Department of Defense  citing a November 29 discussion, Navy Adm. James G. Stavridis said “cybersecurity is a priority within the [NATO] alliance, and member nations are taking steps to both improve distribution of intelligence and protect its networks…Cyber attacks have occurred, and the threat is growing. The attacks are often tough to attribute, can cause immense damage and can be launched by nations, terrorists, criminal gangs or individuals.”

Despite the widespread criticism of the recent Sony hack, North Korea’s government has not been shunned by several nations. Vladimir Putin invited Kim Jong-un to Moscow to join in next year’s 70th anniversary of the Soviet Union’s role in the defeat of Nazi Germany.