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Yet Another Russian Hack of the NSA — This Time with Kaspersky’s Help

The Wall Street Journal has a bombshell of a story. Yet another NSA contractor took classified documents home with him. Yet another Russian intelligence operation stole copies of those documents. The twist this time is that the Russians identified the documents because the contractor had Kaspersky Labs anti-virus installed on his home computer.

This is a huge deal, both for the NSA and Kaspersky. The Wall Street Journal article contains no evidence, only unnamed sources. But I am having trouble seeing how the already embattled Kaspersky Labs survives this.

WSJ follow up. Four more news articles.

EDITED TO ADD: This is either an example the Russians subverting a perfectly reasonable security feature in Kaspersky’s products, or Kaspersky adding a plausible feature at the request of Russian intelligence. In the latter case, it’s a nicely deniable Russian information operation. In either case, it’s an impressive Russian information operation.

What’s getting a lot less press is yet another NSA contractor stealing top-secret cyberattack software. What is it with the NSA’s inability to keep anything secret anymore?

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Ransomware and the Internet of Things

As devastating as the latest widespread ransomware attacks have been, it’s a problem with a solution. If your copy of Windows is relatively current and you’ve kept it updated, your laptop is immune. It’s only older unpatched systems on your computer that are vulnerable.

Patching is how the computer industry maintains security in the face of rampant Internet insecurity. Microsoft, Apple and Google have teams of engineers who quickly write, test and distribute these patches, updates to the codes that fix vulnerabilities in software. Most people have set up their computers and phones to automatically apply these patches, and the whole thing works seamlessly. It isn’t a perfect system, but it’s the best we have.

But it is a system that’s going to fail in the “Internet of things”: everyday devices like smart speakers, household appliances, toys, lighting systems, even cars, that are connected to the web. Many of the embedded networked systems in these devices that will pervade our lives don’t have engineering teams on hand to write patches and may well last far longer than the companies that are supposed to keep the software safe from criminals. Some of them don’t even have the ability to be patched.

Fast forward five to 10 years, and the world is going to be filled with literally tens of billions of devices that hackers can attack. We’re going to see ransomware against our cars. Our digital video recorders and web cameras will be taken over by botnets. The data that these devices collect about us will be stolen and used to commit fraud. And we’re not going to be able to secure these devices.

Like every other instance of product safety, this problem will never be solved without considerable government involvement.

For years, I have been calling for more regulation to improve security in the face of this market failure. In the short term, the government can mandate that these devices have more secure default configurations and the ability to be patched. It can issue best-practice regulations for critical software and make software manufacturers liable for vulnerabilities. It’ll be expensive, but it will go a long way toward improved security.

But it won’t be enough to focus only on the devices, because these things are going to be around and on the Internet much longer than the two to three years we use our phones and computers before we upgrade them. I expect to keep my car for 15 years, and my refrigerator for at least 20 years. Cities will expect the networks they’re putting in place to last at least that long. I don’t want to replace my digital thermostat ever again. Nor, if I ever need one, do I want a surgeon to ever have to go back in to replace my computerized heart defibrillator in order to fix a software bug.

No amount of regulation can force companies to maintain old products, and it certainly can’t prevent companies from going out of business. The future will contain billions of orphaned devices connected to the web that simply have no engineers able to patch them.

Imagine this: The company that made your Internet-enabled door lock is long out of business. You have no way to secure yourself against the ransomware attack on that lock. Your only option, other than paying, and paying again when it’s reinfected, is to throw it away and buy a new one.

Ultimately, we will also need the network to block these attacks before they get to the devices, but there again the market will not fix the problem on its own. We need additional government intervention to mandate these sorts of solutions.

None of this is welcome news to a government that prides itself on minimal intervention and maximal market forces, but national security is often an exception to this rule. Last week’s cyberattacks have laid bare some fundamental vulnerabilities in our computer infrastructure and serve as a harbinger. There’s a lot of good research into robust solutions, but the economic incentives are all misaligned. As politically untenable as it is, we need government to step in to create the market forces that will get us out of this mess.

This essay previously appeared in the New York Times. Yes, I know I’m repeating myself.

EDITED TO ADD: A good cartoon.

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Attack vs. Defense in Nation-State Cyber Operations

I regularly say that, on the Internet, attack is easier than defense. There are a bunch of reasons for this, but primarily it’s 1) the complexity of modern networked computer systems and 2) the attacker’s ability to choose the time and method of the attack versus the defender’s necessity to secure against every type of attack. This is true, but how this translates to military cyber-operations is less straightforward. Contrary to popular belief, government cyberattacks are not bolts out of the blue, and the attack/defense balance is more…well…balanced.

Rebecca Slayton has a good article in International Security that tries to make sense of this: “What is the Cyber Offense-Defense Balance? Conceptions, Causes, and Assessment.” In it, she points out that launching a cyberattack is more than finding and exploiting a vulnerability, and it is those other things that help balance the offensive advantage.

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Incident Response as “Hand-to-Hand Combat”

NSA Deputy Director Richard Ledgett described a 2014 Russian cyberattack against the US State Department as “hand-to-hand” combat:

“It was hand-to-hand combat,” said NSA Deputy Director Richard Ledgett, who described the incident at a recent cyber forum, but did not name the nation behind it. The culprit was identified by other current and former officials. Ledgett said the attackers’ thrust-and-parry moves inside the network while defenders were trying to kick them out amounted to “a new level of interaction between a cyber attacker and a defender.”

[…]

Fortunately, Ledgett said, the NSA, whose hackers penetrate foreign adversaries’ systems to glean intelligence, was able to spy on the attackers’ tools and tactics. “So we were able to see them teeing up new things to do,” Ledgett said. “That’s a really useful capability to have.”

I think this is the first public admission that we spy on foreign governments’ cyberwarriors for defensive purposes. He’s right: being able to spy on the attackers’ networks and see what they’re doing before they do it is a very useful capability. It’s something that was first exposed by the Snowden documents: that the NSA spies on enemy networks for defensive purposes.

Interesting is that another country first found out about the intrusion, and that they also have offensive capabilities inside Russia’s cyberattack units:

The NSA was alerted to the compromises by a Western intelligence agency. The ally had managed to hack not only the Russians’ computers, but also the surveillance cameras inside their workspace, according to the former officials. They monitored the hackers as they maneuvered inside the U.S. systems and as they walked in and out of the workspace, and were able to see faces, the officials said.

There’s a myth that it’s hard for the US to attribute these sorts of cyberattacks. It used to be, but for the US — and other countries with this kind of intelligence gathering capabilities — attribution is not hard. It’s not fast, which is its own problem, and of course it’s not perfect: but it’s not hard.

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NSA Using Cyberattack for Defense

These days, it’s rare that we learn something new from the Snowden documents. But Ben Buchanan found something interesting. The NSA penetrates enemy networks in order to enhance our defensive capabilities.

The data the NSA collected by penetrating BYZANTINE CANDOR’s networks had concrete forward-looking defensive value. It included information on the adversary’s “future targets,” including “bios of senior White House officials, [cleared defense contractor] employees, [United States government] employees” and more. It also included access to the “source code and [the] new tools” the Chinese used to conduct operations. The computers penetrated by the NSA also revealed information about the exploits in use. In effect, the intelligence gained from the operation, once given to network defenders and fed into automated systems, was enough to guide and enhance the United States’ defensive efforts.

This case alludes to important themes in network defense. It shows the persistence of talented adversaries, the creativity of clever defenders, the challenge of getting actionable intelligence on the threat, and the need for network architecture and defenders capable of acting on that information. But it also highlights an important point that is too often overlooked: not every intrusion is in service of offensive aims. There are genuinely defensive reasons for a nation to launch intrusions against another nation’s networks.

[…]

Other Snowden files show what the NSA can do when it gathers this data, describing an interrelated and complex set of United States programs to collect intelligence and use it to better protect its networks. The NSA’s internal documents call this “foreign intelligence in support of dynamic defense.” The gathered information can “tip” malicious code the NSA has placed on servers and computers around the world. Based on this tip, one of the NSA’s nodes can act on the information, “inject[ing a] response onto the Internet towards [the] target.” There are a variety of responses that the NSA can inject, including resetting connections, delivering malicious code, and redirecting internet traffic.

Similarly, if the NSA can learn about the adversary’s “tools and tradecraft” early enough, it can develop and deploy “tailored countermeasures” to blunt the intended effect. The NSA can then try to discern the intent of the adversary and use its countermeasure to mitigate the attempted intrusion. The signals intelligence agency feeds information about the incoming threat to an automated system deployed on networks that the NSA protects. This system has a number of capabilities, including blocking the incoming traffic outright, sending unexpected responses back to the adversary, slowing the traffic down, and “permitting the activity to appear [to the adversary] to complete without disclosing that it did not reach [or] affect the intended target.”

These defensive capabilities appear to be actively in use by the United States against a wide range of threats. NSA documents indicate that the agency uses the system to block twenty-eight major categories of threats as of 2011. This includes action against significant adversaries, such as China, as well as against non-state actors. Documents provide a number of success stories. These include the thwarting of a BYZANTINE HADES intrusion attempt that targeted four high-ranking American military leaders, including the Chief of Naval Operations and the Chairman of the Joint Chiefs of Staff; the NSA’s network defenders saw the attempt coming and successfully prevented any negative effects. The files also include examples of successful defense against Anonymous and against several other code-named entities.

I recommend Buchanan’s book: The Cybersecurity Dilemma: Hacking, Trust and Fear Between Nations.

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Survey Data on Americans and Cybersecurity

Pew Research just published their latest research data on Americans and their views on cybersecurity:

This survey finds that a majority of Americans have directly experienced some form of data theft or fraud, that a sizeable share of the public thinks that their personal data have become less secure in recent years, and that many lack confidence in various institutions to keep their personal data safe from misuse. In addition, many Americans are failing to follow digital security best practices in their own personal lives, and a substantial majority expects that major cyberattacks will be a fact of life in the future.

Here’s the full report.

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Hacking Back

There’s a really interesting paper from George Washington University on hacking back: “Into the Gray Zone: The Private Sector and Active Defense against Cyber Threats.”

I’ve never been a fan of hacking back. There’s a reason we no longer issue letters of marque or allow private entities to commit crimes, and hacking back is a form a vigilante justice. But the paper makes a lot of good points.

Here are three older papers on the topic.

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Auditing Elections for Signs of Hacking

Excellent essay pointing out that election security is a national security issue, and that we need to perform random ballot audits on every future election:

The good news is that we know how to solve this problem. We need to audit computers by manually examining randomly selected paper ballots and comparing the results to machine results. Audits require a voter-verified paper ballot, which the voter inspects to confirm that his or her selections have been correctly and indelibly recorded. Since 2003, an active community of academics, lawyers, election officials and activists has urged states to adopt paper ballots and robust audit procedures. This campaign has had significant, but slow, success. As of now, about three quarters of U.S. voters vote on paper ballots. Twenty-six states do some type of manual audit, but none of their procedures are adequate. Auditing methods have recently been devised that are much more efficient than those used in any state. It is important that audits be performed on every contest in every election, so that citizens do not have to request manual recounts to feel confident about election results. With high-quality audits, it is very unlikely that election fraud will go undetected whether perpetrated by another country or a political party.

Another essay along similar lines.

Related: there is some information about Russian political hacking this election cycle that is classified. My guess is that it has nothing to do with hacking the voting machines — the NSA was on high alert for anything, and I have it on good authority that they found nothing — but something related to either the political-organization hacking, the propaganda machines, or something else before Election Day.

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