Testimony: Hezbollah, the Illicit Networks Global Reach

Place of Origin: Lebanon

Year of Origin: 1982

Founder(s): Ali Akbar Mohtashemi—Iran’s then-ambassador to Syria; Imad Fayez Mughniyeh; Grand Ayatollah Muhammad Hussein Fadlallah; Abbas al-Musawi

Places of Operation: Lebanon, Syria, Germany, Mexico, Paraguay, Argentina, Brazil, Iran, United Arab Emirates

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*** Related reading: Egypt’s Sisi against idea of strikes on Iran, Hezbollah

Emanuele Ottolenghi
House Committee on Foreign Affairs, Western Hemisphere Subcommittee
8 November 2017

Chairman Cook, allow me first to congratulate you on your recent appointment as the new chairman of this subcommittee. Mr. Chairman, Ranking Member Sires, members of the subcommittee, thank you for the opportunity to testify on behalf of the Foundation for Defense of Democracies and its Center on Sanctions and Illicit Finance.

In 2011, the U.S. Drug Enforcement Administration (DEA) indicted Ayman Saied Joumaa, a Lebanese-Colombian dual national whose global network of companies operating out of Latin America, West Africa, and Lebanon laundered money for Mexican and Colombian cartels to the tune of $200 million a month of drug proceeds.[1] Joumaa worked with Hezbollah as the kingpin in one of many networks Hezbollah runs globally to sustain its financial needs. When his case came to light, the New York Times quoted a DEA official as saying that Hezbollah operated like “the Gambinos on steroids.”[2]

The United States cannot continue to combat a threat of such magnitude unless it leverages all its tools of statecraft in a combined, sustained, and coordinated fashion. Over the past decade, Hezbollah’s terror finance outside Lebanon has evolved from a relatively small fundraising operation involving trade-based money laundering and charitable donations into a multi-billion dollar global criminal enterprise.

Increasing quantities of Schedule 2 drugs like cocaine invade the U.S. from Latin America, adding fuel to the opioid pandemic that has already cost so many lives.[3] Cocaine consumption is as much a national epidemic as opioids, Mr. Chairman, and Hezbollah helps make it available to U.S. consumers.

This makes Hezbollah, its senior leadership, and its numerous operatives involved in running illicit drug-trafficking and money-laundering operations on a global scale the perfect candidates for Kingpin and Transnational Crime Organization designations, in addition to the terrorism and terror finance designations already in place.

The U.S. government has, over the years, developed remarkably sharp and effective tools to counteract Hezbollah’s terror finance threat, but is not using them as vigorously as it should. The Kingpin Act is one such instrument. But like all other instruments of statecraft, its impact would be much greater if used consistently and in conjunction with other tools. The challenge for Congress, the executive branch, the intelligence community, and law enforcement agencies is to leverage these tools in a manner that will outsmart Hezbollah and disrupt its cash flows enough to inflict irreparable damage to the terror group’s finances.

In pursuit of this goal, America needs to better coordinate the application and enforcement of all instruments available from the formidable toolbox created over the past two decades by legislation and executive orders, including leveraging Executive Orders 13581 and 13773 on combating transnational organized crime, Executive Order 13224 on combating sources of terror finance, the 1999 Foreign Narcotics Kingpin Designation Act, the 2015 Hezbollah International Financing Prevention Act (HIFPA), the Global Magnitsky Human Rights Accountability Act of 2016, and soon the Hezbollah International Financing Prevention Act Amendment of 2017, which is now awaiting reconciliation between its House and Senate versions and which will, once approved, expand on HIFPA.

In doing so, it should focus significantly on the Western Hemisphere, where Hezbollah’s global footprint, especially in Latin America, is most menacing.

Hezbollah’s regional operations are part of a global network of illicit financial and commercial enterprises whose goal is to fund Hezbollah’s activities in the Middle East. Where and when needed, these networks can also be activated to provide logistical support to operatives engaged in planning terror attacks. The United States therefore needs to think and act globally to disrupt Hezbollah’s illicit finance networks. Latin America is a very good place to start doing that.

In the remainder of my testimony, I will discuss evidence demonstrating the magnitude of the threat posed by Hezbollah’s terror finance to the national security of the United States. I will also provide evidence of the high-ranking nature of Hezbollah’s operatives in Latin America – a sure sign of the importance of Hezbollah’s Latin American networks to the organization’s budget. And I will discuss the impact of U.S. policy and actions on disrupting Hezbollah’s terror finance activities. The evidence I am presenting today, hopefully, will highlight both strengths and weaknesses of present U.S. policy and offer ways to improve results.

Download the full testimony here.

[1] U.S. Department of the Treasury, Press Release, “Treasury Targets Major Lebanese-Based Drug Trafficking and Money Laundering Network,” January 26, 2011. (https://www.treasury.gov/press-center/press-releases/Pagés/tg1035.aspx); see also: U.S. Department of the Treasury, Press Release, “U.S. Charges Alleged Lebanese Drug Kingpin with Laundering Drug Proceeds for Mexican and Colombian Drug Cartels,” December 13, 2011. (https://www.justice.gov/archive/usao/vae/news/2011/12/20111213joumaanr.html)

[2] Jo Becker, “Beirut Bank Seen as a Hub of Hezbollah’s Financing,” The New York Times, December 13, 2011. (http://www.nytimes.com/2011/12/14/world/middleeast/beirut-bank-seen-as-a-hub-of-hezbollahs-financing.html)

[3] Nick Miroff, “American cocaine use is way up. Colombia’s coca boom may be why,” The Washington Post, March 4, 2017. (https://www.washingtonpost.com/news/worldviews/wp/2017/03/04/colombias-coca-boom-is-showing-up-on-u-s-streets/?utm_term=.d370be3ebe9c)

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*** A short briefing from the State Department on October 10, 2017 by National Counter-terrorism Center Director, Nick Rasmussen:

Hizballah’s use of terrorism across the globe, which has persisted for several decades; second, the group’s continued effort to advance terrorism acts worldwide; and third, the fact that the organization is, in fact, focused on U.S. interests, including here in the homeland. And that is part of the reason why we are here today.

Lebanese Hizballah has repeatedly demonstrated for the world its true character. It is an organization that relies on terrorism as well as other forms of violence and coercion to achieve its goals. And this takes place in spite of the group’s attempts to portray itself as a legitimate political party. Prior to September 11th, I think everybody knows Hizballah was responsible for the terrorism-related deaths of more U.S. citizens than any other foreign terrorist organization.

Now, for many Americans, their introduction to the threat posed by this group came after Hizballah’s attack on the U.S. embassy in Beirut in April of 1983. That horrific attack killed 63 and wounded an additional 120 individuals, and it was followed by an even more deadly attack on our Marine barracks in October of 1983 which killed 241 Americans and wounded an additional 128 Americans.

So Hizballah’s penchant for violence has not changed over the last three decades. We’ve seen time and time again with its international terrorism unit, the External Security Organization, also known as the IJO, the Islamic Jihad Organization, and Unit 910, 9-1-0. But its deployment of operatives to nearly every corner of the globe continues to engage in terrorism-related activity.

In 2012 the group carried out a bomb attack in Bulgaria that killed five Israeli tourists and one Bulgarian national, and a number of Hizballah operatives have been caught laying the groundwork for attacks in places like Azerbaijan, in Egypt, in Thailand, in Cyprus, and in Peru. And there are other instances of Hizballah-related arrests and disruptions around the world that are at this point unpublicized and remain classified.

But all of this together shows us that the group seeks to develop and maintain a global capability to carry out acts of terror. I can assure you that the conversation today would be much different had some of these disrupted plots actually succeeded. Casualty counts would be higher and many innocent lives would have been forever altered. The group is also known to focus on areas populated by tourists, almost guaranteeing that with their attacks innocent victims – innocent civilians will be victims.

Now, with respect to the homeland here in the United States, let me say this. While much of our work in the government since 9/11 has focused on al-Qaida and more recently on ISIS, in the 20 years since Hizballah’s designation as a foreign terrorist organization, we have never taken our focus off of Hizballah and on the threat it represents to the homeland.

***

Syria, ISIS, and the Broader Middle East
As an Iranian proxy, Hezbollah has taken up arms alongside Syrian and Iranian forces in defense of the Syrian regime in that country’s civil war. In 2012, the U.S. Treasury levied additional sanctions on Hezbollah for its support of Syrian President Bashar al-Assad’s regime. According to Treasury, since the beginning of the Syrian civil war in early 2011,
Hezbollah provided “training, advice and extensive logistical support to the Government of Syria’s increasingly ruthless efforts to fight against the opposition.” 45
As of October 2016, Hezbollah and Syrian forces were reportedly besieging some 40,000 Syrians in three towns, preventing them access to medical treatment. 46
During an October 2016 rally in Beirut, Nasrallah promised that Hezbollah
would “continue to bear our great responsibilities of jihad” in Syria. 47
In January 2015, in response to Israeli airstrikes on alleged weapons shipments to Hezbollah in Syria, Nasrallah called the strikes an aggression against Syria’s regional allies.
As such, Syria’s allies have the right to retaliate, according to Nasrallah. 48
Hezbollah’s activity in Syria has its domestic detractors as well. Subhi al-Tufayli, Hezbollah’s first secretary-general from 1989 to 1991, has accused Hezbollah of being
a “partner in the killing of the Syrian people.” He denounced Hezbollah members who fight alongside Russians, and called on the Hezbollah leadership to heed Lebanese opposition to the group’s involvement in Syria. 49
Hezbollah’s role in Syria is not limited to fighting anti-government rebels. Under Iranian direction, Hezbollah has also fought against ISIS, which Nasrallah described as a growing threat to the region and an existential threat to Lebanon in an August 2014 interview with the Lebanese newspaper Al-Akhbar. 50
Hezbollah has also fought against the Nusra Front (Jabhat Fateh al-Sham).51
On October 19, 2016, Qassem told Hezbollah’s Al-Manar TV that Hezbollah “will not leave Syria as long as there is a need to confront takfiri groups.” 52
In November 2016, Hezbollah held a public parade in the Syrian city of Qusair to highlight its role in the conflict. The terror group showcased U.S. and Russian armored personnel carriers and tanks. The U.S. State Department issued a statement that it was “gravely concerned” and investigating how Hezbollah acquired U.S. equipment. 53
The United States provides aid to the Lebanese military, which denied that U.S.-provided weaponry had been transferred to Hezbollah 54. Read the full report here.

Anyone Paying Attention to Wilbur Ross, Commerce Sec?

What is Wilbur Ross worth? The answer is a slippery one when you ask Wilbur to respond. There is a dispute when it comes to his financials in the ranger of a billion or two. Further, where did his wealth come from you ask? Well there were allegedly family trusts, hotels, shipping companies, steel, banking in Cyprus and even those Rothschilds. More here from Forbes.

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Wilbur Ross’ company has been moving LPG for a Russian gas giant.

But now, in what might seem almost an echo of the Red Scare that lasted in America for generations, this business relationship is seen as tainted, an ominous connection to a country that unleashed cyberwar against American democracy and the 2016 election that put Trump in the White House.

Are all connections to Russia now suspect? Or are they sometimes merely an inconvenient consequence of doing business in a country where major corporations often are controlled by the Kremlin?

The latest tie between Russia, Trump and his campaign and administration officials came to light Sunday with news that the U.S. commerce secretary is a part owner of Navigator Holdings, a shipping company that transports LPG produced by Sibur, a big Russian company with ties to the Kremlin.

Some shipping business experts who follow the company are shrugging off the news.

“Russia has a lot of commodities that need to go somewhere else,” said Benjamin J. Nolan, a financial analyst who covers Navigator for Stifel, Nicolaus & Co. He added, “Odds are, they are going to have long term contracts with Western shipping companies.”

The Russian government is a powerful factor in almost every part of the country’s economy. Some of Russia’s biggest banks, such as Sberbank and VTB are state-controlled, with their management answering directly or indirectly to the Kremlin.

Then there is Gazprom, a big gas supplier to Europe, and Rosneft, the oil producer. Both are majority state owned.

***

Two people associated with Siber are under U.S. sanctions

***

How about Venezuela? Yup…

Despite U.S. sanctions on Venezuela’s bond transactions in international markets and other restrictions against top officials, the Paradise Papers show that Secretary of Commerce Wilbur Ross has an important stake in multi-million dollar businesses related with state-oil giant Petróleos de Venezuela (PDVSA).

As reported by Newsweek on Sunday, Ross still retains interest in Navigator Holdings, a shipping company incorporated in the Marshall Islands in the South Pacific that maintains a close relationship with Russia’s energy company SIBUR, which is run by President Vladimir Putin’s son-in-law Kirill Shamalov and other individuals who have been sanctioned by the U.S. Navigator Holdings has received millions of dollars every year in earnings due to coastal shipping services provided to PDVSA.

PDVSA is no small client of Navigator Holdings. The state-oil company contributed to 10.7 percent of Navigator’s earnings during fiscal year 2014 and 11.7 percent in fiscal year 2015, according to Venezuelan newspaper El Nacional. The company’s earnings translate into $33.7 million and $36.7 million for each fiscal year thanks to PDVSA’s use of the Navigator’s 29 tankers to carry liquefied petroleum gas during those years.

As he was awaiting confirmation, Ross failed to disclose any business interests with Putin’s family and his stake in the maritime industry. James Rockas, Ross’s spokesman, told the New York Times that the secretary of commerce “recuses himself from any matters focused on transoceanic shipping vessels, but has been generally supportive of the [Trump] administration’s sanctions of Russian and Venezuelan entities.”

But Ross’s businesses pose a potential conflict of interest, ICIJ reported. Ross has “the power to influence U.S. trade, sanctions and other matters that could affect SIBUR’s owners,” the Paradise Papers report added. More here from Newsweek.

 

Import a Terrorist, Apply to the Diversity Visa Lottery Program

Even the LATimes calls for the program to be ended. In part: Sayfullo Saipov, who allegedly killed eight and wounded 11 in a truck attack on Tuesday, entered the country from Uzbekistan through the diversity visa lottery. He is not the first presumed terrorist to enter using the program. Lottery terrorists include Hesham Mohamed Ali Hedayet, who shot up an El-Al ticket counter in 2002, killing two, and Imran Mandhai, who planned to bomb power stations in Florida the same year.

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The chilling details on Imran Mandhai are located here.

Imran Mandhai.

National security problems with the lottery have long been known. At a 2003 congressional hearing, the inspector general of the State Department, which oversees the lottery, testified that the program “contains significant risks to national security from hostile intelligence officers, criminals and terrorists attempting to use the program for entry into the United States as permanent residents.”

The concerns identified at that hearing 14 years ago remain. In 2016, Immigration and Customs Enforcement created a list of countries that “promote, produce, or protect terrorist organizations or their members.” Of the top 10 source countries for lottery winners in 2016, four were on ICE’s list: Egypt (No. 2), Iran (No. 3), Uzbekistan (No. 5) and Sudan (No. 7). Many other countries on the ICE list also send significant numbers of lottery winners.

In 2015, 14.4 million individuals plus family members successfully registered for the annual drawing. The State Department has to weed out those who do not qualify. After a computer randomly selects 100,000 names. State Department employees interview and vet the finalists, whittling down the list to the 50,000 cap. This is no simple task, since most applicants come from countries where recordkeeping is spotty and documents are hard to verify. Screening for visa lottery fraud takes up valuable State Department resources that could be allocated elsewhere if the program did not exist.

*** Suddenly, Chucky Schumer is suddenly quiet or forgets some facts.

The program was created by the late-Senator Ted Kennedy in the early 1990s, with help from then-Rep. Chuck Schumer, now the Senate Minority Leader, as a way to open the door to more Irish immigrants who could not qualify for immigration opportunities because of our equally nonsensical family chain migration policy. Of course, Schumer (and Kennedy until his death), continues to this day to defend family chain migration, and is fighting efforts to adopt a merit-based immigration policy that would obviate the need for the annual Wheel of Fortune exercise. More here. 

Included in the lottery are all four countries the U.S considers state sponsors of terror — Iran, Sudan, Cuba, and Syria — and 13 of the 14 nations that are coming under special monitoring from the Transportation Security Administration as founts of terrorism. Pakistan is excluded because, like China, it sends over tens of thousands of immigrants each year and doesn’t need to be in the lottery.

Among the winners for 2010 are:

Nigeria: 6,006
Iran: 2,773
Algeria: 1,957
Sudan: 1,084
Afghanistan: 345
Cuba: 298
Somalia: 229
Lebanon:
181
Libya: 152
Iraq: 142
Saudi Arabia:
104
Syria:
98
Yemen:
72

The State Department’s Office of the Inspector General recommended in a 2003 report that terror-sponsoring nations be removed from the diversity visa program.

“OIG believes that this program contains significant vulnerabilities to national security as hostile intelligence officers, criminals and terrorists attempt to use it to enter the United States as permanent residents,” the office’s deputy inspector testified to Congress in 2004.

A separate report filed by the Government Accountability Office also faulted the program for being susceptible to widespread fraud. A cottage industry has emerged abroad to cater to the lottery, and it regularly bilks people out of massive amounts of money and even coerces some into marriage to keep their diversity visas. More here.

Meanwhile:

The resettlement of refugees in the U.S. has been fairly consistent across the country since 2002, with no state resettling a majority of them. In fiscal year 2017, no state resettled more than 10% of the 53,716 refugees the nation admitted that year. California, Texas, New York, Washington, Michigan and Ohio each accounted for at least 5% of refugees resettled, while all other states had a lower share. In fiscal 2002, the earliest year state-level data are publicly available, California resettled 16% of the nation’s 27,110 refugees, the only state to account for more than 15% of the nation’s total that year – or in any following year, according to a Pew Research Center analysis of U.S. State Department data.

Most refugees today come from the Middle East and Africa, but this has not always been the case. Check more details here.

Russia Hacked the World, DoJ Suing Kremlin Operatives?

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FNC: The Justice Department reportedly has garnered enough evidence to charge at least six Russian government operatives with hacking the Democratic National Committee’s computers during the 2016 presidential election.

The Wall Street Journal reported Thursday that federal prosecutors could bring charges early next year. The Journal reported that dozens of others may have also played a role in the cyberattack.

Even tech companies are suing Russia.

How Russia hacked the world: Putin’s spies used ‘digital hit list’ to hunt global targets

  • 19,000 malicious links collected by Secureworks after Fancy Bear mistake.

  • 4,700 Gmail users across the globe were targeted by the state hacking team.

  • Alongside Democrats, a handful of Republican targets were also identified.

The hackers who upended the US presidential election had ambitions well beyond Hillary Clinton’s campaign, targeting the emails of Ukrainian officers, Russian opposition figures, US defence contractors and thousands of others of interest to the Kremlin, according to a previously unpublished digital hit list obtained by The Associated Press.

The list provides the most detailed forensic evidence yet of the close alignment between the hackers and the Russian government, exposing an operation that stretched back years and tried to break into the inboxes of 4,700 Gmail users across the globe — from the pope’s representative in Kiev to the punk band Pussy Riot in Moscow.

“It’s a wish list of who you’d want to target to further Russian interests,” said Keir Giles, director of the Conflict Studies Research Centre in Cambridge, England, and one of five outside experts who reviewed the AP’s findings. He said the data was “a master list of individuals whom Russia would like to spy on, embarrass, discredit or silence.”

The AP findings draw on a database of 19,000 malicious links collected by cybersecurity firm Secureworks, dozens of rogue emails, and interviews with more than 100 hacking targets.

Secureworks stumbled upon the data after a hacking group known as Fancy Bear accidentally exposed part of its phishing operation to the internet.

The list revealed a direct line between the hackers and the leaks that rocked the presidential contest in its final stages, most notably the private emails of Clinton campaign chairman John Podesta.

The issue of who hacked the Democrats is back in the national spotlight following the revelation Monday that a Donald Trump campaign official, George Papadopoulos, was briefed early last year that the Russians had “dirt” on Clinton, including “thousands of emails.”

Kremlin spokesman Dmitry Peskov called the notion that Russia interfered “unfounded.” But the list examined by AP provides powerful evidence that the Kremlin did just that.

“This is the Kremlin and the general staff,” said Andras Racz, a specialist in Russian security policy at Pazmany Peter Catholic University in Hungary, as he examined the data. “I have no doubts.”

New evidence

Secureworks’ list covers the period between March 2015 and May 2016. Most of the identified targets were in the United States, Ukraine, Russia, Georgia and Syria.

In the United States, which was Russia’s Cold War rival, Fancy Bear tried to pry open at least 573 inboxes belonging to those in the top echelons of the country’s diplomatic and security services: then-Secretary of State John Kerry, former Secretary of State Colin Powell, then-NATO Supreme Commander, US Air Force Gen. Philip Breedlove, and one of his predecessors, US Army Gen. Wesley Clark.

The list skewed toward workers for defence contractors such as Boeing, Raytheon and Lockheed Martin or senior intelligence figures, prominent Russia watchers and — especially — Democrats. More than 130 party workers, campaign staffers and supporters of the party were targeted, including Podesta and other members of Clinton’s inner circle.

The AP also found a handful of Republican targets.

Podesta, Powell, Breedlove and more than a dozen Democratic targets besides Podesta would soon find their private correspondence dumped to the web. The AP has determined that all had been targeted by Fancy Bear, most of them three to seven months before the leaks.

“They got two years of email,” Powell recently told AP. He said that while he couldn’t know for sure who was responsible, “I always suspected some Russian connection.”

In Ukraine, which is fighting a grinding war against Russia-backed separatists, Fancy Bear attempted to break into at least 545 accounts, including those of President Petro Poroshenko and his son Alexei, half a dozen current and former ministers such as Interior Minister Arsen Avakov and as many as two dozen current and former lawmakers.

The list includes Serhiy Leshchenko, an opposition parliamentarian who helped uncover the off-the-books payments allegedly made to Trump campaign chairman Paul Manafort — whose indictment was unsealed Monday in Washington.

In Russia, Fancy Bear focused on government opponents and dozens of journalists.

Among the targets were oil tycoon-turned-Kremlin foe Mikhail Khodorkovsky, who spent a decade in prison and now lives in exile, and Pussy Riot’s Maria Alekhina. Along with them were 100 more civil society figures, including anti-corruption campaigner Alexei Navalny and his lieutenants.

“Everything on this list fits,” said Vasily Gatov, a Russian media analyst who was himself among the targets. He said Russian authorities would have been particularly interested in Navalny, one of the few opposition leaders with a national following.

Many of the targets have little in common except that they would have been crossing the Kremlin’s radar: an environmental activist in the remote Russian port city of Murmansk; a small political magazine in Armenia; the Vatican’s representative in Kiev; an adult education organisation in Kazakhstan.

“It’s simply hard to see how any other country would be particularly interested in their activities,” said Michael Kofman, an expert on Russian military affairs at the Woodrow Wilson International Centre in Washington.

He was also on the list.

“If you’re not Russia,” he said, “hacking these people is a colossal waste of time.”

Working 9 to 6 (Moscow Time)

Allegations that Fancy Bear works for Russia aren’t new. But raw data has been hard to come by.

Researchers have been documenting the group’s activities for more than a decade and many have accused it of being an extension of Russia’s intelligence services. The “Fancy Bear” nickname is a none-too-subtle reference to Russia’s national symbol.

In the wake of the 2016 election, US intelligence agencies publicly endorsed the consensus view, saying what American spooks had long alleged privately: Fancy Bear is a creature of the Kremlin.

But the US intelligence community provided little proof, and even media-friendly cybersecurity companies typically publish only summaries of their data.

That makes the Secureworks’ database a key piece of public evidence — all the more remarkable because it’s the result of a careless mistake.

Secureworks effectively stumbled across it when a researcher began working backward from a server tied to one of Fancy Bear’s signature pieces of malicious software.

He found a hyperactive Bitly account Fancy Bear was using to sneak thousands of malicious links past Google’s spam filter. Because Fancy Bear forgot to set the account to private, Secureworks spent the next few months hovering over the group’s shoulder, quietly copying down the details of the thousands of emails it was targeting.

The AP obtained the data recently, boiling it down to 4,700 individual email addresses, and then connecting roughly half to account holders.

The AP validated the list by running it against a sample of phishing emails obtained from people targeted and comparing it to similar rosters gathered independently by other cybersecurity companies, such as Tokyo-based Trend Micro and the Slovakian firm ESET.

The Secureworks data allowed reporters to determine that more than 95% of the malicious links were generated during Moscow office hours — between 9 am and 6 pm Monday to Friday.

The AP’s findings also track with a report that first brought Fancy Bear to the attention of American voters. In 2016, a cybersecurity company known as CrowdStrike said the Democratic National Committee had been compromised by Russian hackers, including Fancy Bear.

Secureworks’ roster shows Fancy Bear making aggressive attempts to hack into DNC technical staffers’ emails in early April 2016 — exactly when CrowdStrike says the hackers broke in.

Hacking hands
Fancy Bear have long been linked to the Russian security services iStock

And the raw data enabled the AP to speak directly to the people who were targeted, many of whom pointed the finger at the Kremlin.

“We have no doubts about who is behind these attacks,” said Artem Torchinskiy, a project coordinator with Navalny’s Anti-Corruption Fund who was targeted three times in 2015. “I am sure these are hackers controlled by Russian secret services.”

The myth if the 400-pound man

Even if only a small fraction of the 4,700 Gmail accounts targeted by Fancy Bear were hacked successfully, the data drawn from them could run into terabytes — easily rivalling the biggest known leaks in journalistic history.

For the hackers to have made sense of that mountain of messages — in English, Ukrainian, Russian, Georgian, Arabic and many other languages — they would have needed a substantial team of analysts and translators. Merely identifying and sorting the targets took six AP reporters eight weeks of work.

The AP’s effort offers “a little feel for how much labour went into this,” said Thomas Rid, a professor of strategic studies at Johns Hopkins University’s School of Advanced International Studies.

He said the investigation should put to rest any theories like the one then-candidate Donald Trump floated last year that the hacks could be the work of “someone sitting on their bed that weighs 400 pounds.”

“The notion that it’s just a lone hacker somewhere is utterly absurd,” Rid said.

***

Axios: Marathon congressional hearings on Russian election interference and social media left execs from Facebook, Google and Twitter badly bruised and with a new view of just how mad Washington is about their handling of content aiming to divide Americans.

The big takeaway: Lawmakers’ rebukes went far beyond the companies’ responses to Russia’s interference. They also repeatedly revealed a discomfort with the size, power and limited accountability of the large web platforms.

What else we learned:

  • Washington isn’t buying that Facebook, Google and Twitter aren’t media companies. Both Republicans and Democrats seemed baffled at times by an assumption that has been fundamental to Google, Facebook and Twitter’s growth: that they are neutral platforms for information, not judges of content. Multiple lawmakers questioned that argument: “That may well be a distinction that is lost on most of us, that you’re just a platform for other people to express their views as opposed to being a publisher in their own right of those views,” said Republican Sen. John Cornyn.
  • We now know what the Russian ads look like. Lawmakers released some of the Russian-bought ads, which were focused largely on divisive political issues like civil rights, immigration and religion. According to the metadata released, the ads targeted both Republicans and Democrats and were paid for in rubles. For example, one “Black Matters” ad targeted adults in Georgia, Maryland, Missouri and Virginia and received more than 200,000 impressions and more than 12,000 clicks. It cost 53,425 rubles ($915).
  • Still no backing for a regulatory fix. The only piece of concrete legislation tied to this issue is the Honest Ads Act, which would require disclosure for online political ads. While the companies all committed to improving transparency, and companies indicated that they could work with lawmakers on the bill, they did not endorse it.
  • Lawmakers felt slighted by the CEOs’ absence. “I wish your CEOs were here,” said Democratic Sen. Joe Manchin, one of many lawmakers who voiced that sentiment. “They need to answer for this.”
  • The companies are putting significant resources toward vetting content. During nine hours of hearings, they repeatedly touted how much they were investing in both money and personnel to solve the election interference issue. Facebook is doubling the people working on safety and security issues to 20,000 by the end of 2018, for example.
  • Democrats were the harshest critics. Silicon Valley has long had a strong relationship with the liberal left, but that didn’t stop California Sens. Dianne Feinstein and Kamala Harris, as well as tech ally Sen. Ron Wyden, from lacing into the witnesses. Republicans, while critical of the companies, stopped short of conceding that social media manipulation was a deciding factor in Donald Trump’s win.
  • Congressional investigators are still learning the basics. One lawmaker asked Twitter’s general counsel to explain the difference between a bot and a troll. Several inquired about the definition of “impressions.” This highlights how steep the learning curve is for elected officials to fully grasp the nuances of what went wrong online in 2016.
  • Tech made a huge political miscalculation in not moving faster. Again and again, the companies were chided for how long it took them to deliver the goods to investigators. “I hear all your words,” said Sen. Mark Warner, “but I have more than a little bit of frustration that many of us on this committee have been raising this issue since the beginning of this year, and our claims were frankly blown off by the leaderships of your companies.”
What’s next? All of the companies indicated their investigations are ongoing, so the scale of the Russian disinformation campaign could turn out to be even bigger than we know now.

Go deeper:

U.S Should Follow Europe’s Lead on Cyber

Imagine that….Europe may be more right on this issue than the United States is due to congress where decisions just cannot be made.

Going back to 2011, the Pentagon has concluded that computer sabotage coming from another country can constitute an act of war, a finding that for the first time opens the door for the U.S. to respond using traditional military force.

In 2016, Pentagon leaders are still working to determine when, exactly, a cyber-attack against the U.S. would constitute an act of war, and when, exactly, the Defense Department would respond to a cyber-attack on civilian infrastructure, a senior Defense Department official told lawmakers on Wednesday.

A cyber strike as an act of war “has not been defined,” Acting Assistant Secretary of Defense for Homeland Defense and Global Security Thomas Atkin told the House Armed Services Committee. “We’re still working toward that definition.” More here.

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Related reading: North Korea’s Elite Cyber Soldiers Hacked Top Secret Warship Blueprints, Seoul Lawmaker Says

So, is Europe ahead of the United States on this issue?

EU governments to warn cyber attacks can be an act of war

European Union governments will formally state that cyber attacks can be an act of war in a show of strength to countries such as Russia and North Korea.

Diplomats and ambassadors in Brussels have drafted a document, obtained by The Telegraph, that represents an unprecedented deterrent aimed at countries using hackers and cyber espionage against EU members.

The document, set to be agreed by all 28 EU members states, including Britain, in the coming weeks warns that individual member states could respond “in grave instances” to cyber attacks with conventional weapons.

The British government has now said it was all but certain that North Korea was behind the “WannaCry” malware attack that hit NHS IT systems in May. Work on the EU paper began among fears that Russia would attempt to influence this year’s German elections and over hybrid warfare employed in Ukraine. More here.

This could be a pretext for what is a probable threat.

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Banks fearing North Korea hacking prepare defenses: cyber experts

WASHINGTON/TORONTO (Reuters) – Global banks are preparing to defend themselves against North Korea potentially intensifying a years-long hacking spree by seeking to cripple financial networks as Pyongyang weighs the threat of U.S. military action over its nuclear program, cyber security experts said.

North Korean hackers have stolen hundreds of millions of dollars from banks during the past three years, including a heist in 2016 at Bangladesh Bank that yielded $81 million, according to Dmitri Alperovitch, chief technology officer at cyber security firm CrowdStrike.

Alperovitch told the Reuters Cyber Security Summit on Tuesday that banks were concerned Pyongyang’s hackers may become more destructive by using the same type of “wiper” viruses they deployed across South Korea and at Sony Corp’s (6758.T) Hollywood studio.

The North Korean government has repeatedly denied accusations by security researchers and the U.S. government that it has carried out cyber attacks.

North Korean hackers could leverage knowledge about financial networks gathered during cyber heists to disrupt bank operations, according to Alperovitch, who said his firm has conducted “war game” exercises for several banks.

“The difference between theft and destruction is often a few keystrokes,” Alperovitch said.

Security teams at major U.S. banks have shared information on the North Korean cyber threat in recent months, said a second cyber security expert familiar with those talks.

“We know they attacked South Korean banks,” said the source, who added that fears have grown that banks in the United States will be targeted next.

Tensions between Washington and Pyongyang have been building after a series of nuclear and missile tests by North Korea and bellicose verbal exchanges between U.S. President Donald Trump and North Korean leader Kim Jong Un.

John Carlin, a former U.S. assistant attorney general, told the Reuters summit that other firms, among them defense contractors, retailers and social media companies, were also concerned.

“They are thinking ‘Are we going to see an escalation in attacks from North Korea?’” said Carlin, chair of Morrison & Foerster international law firm’s global risk and crisis management team.

Jim Lewis, a cyber expert with Washington’s Center for Strategic and International Studies, said it is unlikely that North Korea would launch destructive attacks on American banks because of concerns about U.S. retaliation.

Representatives of the U.S. Federal Reserve and the Office of the Comptroller of the Currency, the top U.S. banking regulators, declined to comment. Both have ramped up cyber security oversight in recent years.

For other Reuters Cyber Summit news click on www.reuters.com/cyberrisk