Category Archives: DOJ, DC and inside the Beltway

Watch Out America, Venezuela a Failed State

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Venezuela Is About to Go Bust

Nagel/ForeignPolicy: Venezuela’s economy is facing a tsunami of bad news. The country is suffering from the world’s deepest recession, highest inflation rate, and highest credit risk — all problems aggravated by plunging oil prices. Despite all its troubles, though, until now Venezuela has kept making payments on its $100-billion-plus foreign debt.

That is about to end. In recent days a consensus has emerged among market analysts:

Venezuela will have to default. The only question is when.

Venezuela will have to default. The only question is when.

A Venezuela meltdown could rock financial markets, and people around the world will lose a lot of money. But we should all save our collective sympathy — both the government in Caracas and the investors who enabled it had it coming.

In the last few years, the Venezuelan government has been steadfast about staying in good graces with its lenders. It has paid arrears on its debt religiously, and has constantly asserted that it will continue paying.

But it has neglected to implement the reforms Venezuela would need to improve the fundamentals of its economy. Its commitment to socialist “populism” and the complicated internal dynamics within the governing coalition have paralyzed the government. It has repeatedly postponed important reforms like eliminating its absurd exchange rate controls (the country has at least four exchange rates) or raising the domestic price of gasoline (the cheapest in the world by far). Instead, the government has “adjusted” by shutting off imports, leaving store shelves all over the country barren.

This strategy now seems unsustainable. According to various estimates, in 2015 Venezuela imported about $32 billion worth of goods. This was a marked drop from the previous year. This year, given current oil prices and dwindling foreign reserves, if Venezuela were to pay off its obligations — at least $10 billion — and maintain government spending, it would have to import close to nothing. In a country that imports most of what it consumes, this would ensure mayhem. That is why all analysts predict default in the coming months.

The Economist has joined the chorus, saying that “the government has run out of dollars.” In the words of Harvard professor Ricardo Hausmann, this will be “the largest and messiest emerging market sovereign default since the Argentine crisis of 2001.”

One of the reasons the coming default will be so messy is the many instruments involved, all issued under widely varying conditions. Part of the stock of debt was issued by PDVSA, Venezuela’s state-owned oil company, which owns significant assets overseas (For example, Citgo is 100 percent owned by the Venezuelan government). Another part of the debt was issued by the national government directly, while another big chunk is owed to China, under secretive terms.

The Chinese issue looms large. China’s loans to Venezuela — close to about $18 billion, according to Barclay’s – consist of short-term financing payable via oil shipments. As the price of oil collapses, Venezuela needs to ship more oil to China in order to pay them back. Barclay’s estimates that right now this is close to 800,000 barrels per day, leaving little more than a million barrels per day Venezuela can sell for cash.

A default will send ripples beyond Wall Street. Many people have been buying high-risk, high-return Venezuelan debt for years — from pension funds in far-off countries to small banks in developing ones. Most stand to lose their shirts. Yet the signs that this was unsustainable were there for all to see.

For years, Venezuela has had a massive budget deficit, sustained only by exorbitant oil prices. For years, analysts have been warning that the Venezuelan government would rather chew nails that allow the private sector to grow. And yes, a lot of that borrowed money was used to help establish a narco-military kleptocracy.

It is impossible to untangle the ethical implications of all of this. Lending Venezuela money is what business ethics professors talk about when they question “winning at someone else’s expense.” Losing money from investing in Venezuela is akin to losing it from, say, funding a company that engages in morally reprehensible acts. (Insert the name of your favorite evil corporate villain here).

Investors in companies with “tainted profits” from, say, engaging in child labor or violating human rights should not get the world’s sympathy, nor should they be bailed out. Similarly, investors in Venezuelan debt have only their hubris to blame.

In a few months, once the rubble of the Bolivarian revolution is cleared, the discussion will turn to how Venezuela can be helped. It would be smart to remember that aid should come to the Venezuelan people first. As the scarcity of food and medicine grows,

Venezuela may become the first petro-state to face a humanitarian disaster.

Venezuela may become the first petro-state to face a humanitarian disaster.

If and when a responsible government in Caracas asks for foreign assistance, solving this urgent issue should be at the top of the agenda. Conditions on financial assistance should privilege the interests of Venezuelans caught in the debacle above the interests of angry hedge fun managers or international bankers.

In other words, the Venezuelan people should come first. The folks who enabled this catastrophe? They can wait.

 

What is YOUR Profile? Ask Google and Facebook

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You have been profiled, but is it accurate? You have been sold and sold out.

Scary New Ways the Internet Profiles You

Morrison/DailyBeast: Facebook, Google, and the other Internet titans have ever more sophisticated and intrusive methods of mining your data, and that’s just the tip of the iceberg.

The success of the consumer Internet can be attributed to a simple grand bargain. We’ve been encouraged to search the web, share our lives with friends, and take advantage of all sorts of other free services. In exchange, the Internet titans that provide these services, as well as hundreds of other lesser-known firms, have meticulously tracked our every move in order to bombard us with targeted advertising. Now, this grand bargain is being tested by new attitudes and technologies.

Consumers who were not long ago blithely dismissive of privacy issues are increasingly feeling that they’ve lost control over their personal information. Meanwhile, Internet companies, adtech firms, and data brokers continue to roll out new technologies to build ever more granular profiles of hundreds of millions, if not billions, of consumers. And with next generation of artificial intelligence poised to exploit our data in ways we can’t even imagine, the simple terms of the old agreement seem woefully inadequate.

In the early days of the Internet, we were led to believe that all this data would deliver us to a state of information nirvana. We were going to get new tools and better communications, access to all the information we could possibly need, and ads we actually wanted to receive. Who could possibly argue with that?

For a while, the predictions seemed to be coming true. But then privacy goalposts were (repeatedly) moved, companies were caught (accidentally) snooping on us, and hackers showed us just how easy it is to steal our personal information. Advertisers weren’t thrilled either, particularly when we adopted mobile phones and tablets. That’s because the cookies that track us on our computers don’t work very well on mobile devices. And with our online activity split among our various devices, each of us suddenly appeared to be two or three different people.

This wasn’t a bad thing for consumers, because mobile phones emit data that enable companies to learn new things about us, such as where we go, who we meet, places we shop, and other habits that help them recognize and then predict our long-term patterns.

But now, new cross-device technologies are enabling the advertising industry to combine all our information streams into a single comprehensive profile by linking each of us to our desktop, mobile phone, and iPad. Throw in wearable devices like a Fitbit, connected TVs, and the Internet of Things, and the concept of cross-device tracking expands to potentially include anything that gives off a signal.

The ad industry is drooling over this technology because it can follow and target us as we move through our daily routines, whether we are searching on our desktop, surfing on our iPad, or out on the town with our phone in hand.

There are two methods to track people across devices. The more precise technique is deterministic tracking, which links devices to a single user when that person logs into the same site from a desktop computer, phone, and tablet. This is the approach used by Internet giants like Facebook, Twitter, Google, and Apple, all of which have enormous user bases that log into their mobile and desktop properties.

A quick glance at Facebook’s data privacy policy shows it records just about everything we do, including the content we provide, who we communicate with, what we look at on its pages, as well as information about us that our friends provide. Facebook saves payment information, details about the devices we use, location info, and connection details. The social network also knows when we visit third-party sites that use its services (such as the Like button, Facebook Log In, or the company’s measurement and advertising services). It also collects information about us from its partners.

Most of the tech giants have similar policies and they all emphasize that they do not share personally identifiable information with third parties. Facebook, for example, uses our data to deliver ads within its walled garden but says it does not let outsiders export our information. Google says it only shares aggregated sets of anonymized data.

Little-known companies—primarily advertising networks and adtech firms like Tapad and Drawbridge—are also watching us. We will never log into their websites, so they use probabilistic tracking techniques to link us to our devices. They start by embedding digital tags or pixels into the millions of websites we visit so they can identify our devices, monitor our browsing habits, look for time-based patterns, as well as other metrics. By churning massive amounts of this data through statistical models, tracking companies can discern patterns and make predictions about who is using which device. Proponents claim they are accurate more than 90 percent of the time, but none of this is visible to us and is thus very difficult to control.

In recent comments to the Federal Trade Commission, the Center for Democracy and Technology illustrated just how invasive cross-device tracking technology could be. Suppose a user searched for sexually transmitted disease (STD) symptoms on her personal computer, used a phone to look up directions to a Planned Parenthood clinic, visited a pharmacy, and then returned home. With this kind of cross-device tracking, it would be easy to infer that the user was treated for an STD.

That’s creepy enough, but consider this: by using the GPS or WiFi information generated by the patient’s mobile phone, it would not be difficult to discover her address. And by merging her online profile with offline information from a third-party data broker, it would be fairly simple to identify the patient.

So, should we be concerned that companies use cross-device tracking to compile more comprehensive profiles of us? Let us count the reasons:

Your data could be hacked: Privacy Rights Clearinghouse reports that in 2015 alone, hackers gained access to the records of 4.5 million patients at UCLA Health System, 37 million clients of online cheating website Ashley Madison, 15 million Experian accounts, 80 million Anthem customers, as well as more than 21 million individuals in the federal Office of Personnel Management’s security clearance database. And these were just the headliners that garnered media attention. No site or network is entirely safe and numerous researchers have already demonstrated how incredibly easy it is to “reidentify” or “deanonymize” individuals hidden in anonymized data.

Your profile could be sold: In fact, it typically is, in anonymized fashion. That’s the whole point. But in many cases, Internet companies’ privacy policies also make it clear our profiles are assets to be bought and sold should the company change ownership. This was the case when Verizon bought AOL and merged their advertising efforts, creating much more detailed profiles of their combined user base. Yahoo might be next should it decide to spin off its Internet properties.

Your data could be used in ways you did not anticipate: Google, Facebook, and other companies create customized web experiences based on our interests, behavior, and even our social circles. On one level, this makes perfect sense because none of us want to scroll through reams of irrelevant search results, news stories, or social media updates. But researchers have demonstrated that our online profiles also have real world consequences, including the prices we pay for products, the amount of credit extended to us, and even the job offers we may receive.

Our data is already used to build and test advanced analytics models for new services and features. There is much more to come. The Googles and the Facebooks of the Internet boast that newly emerging artificial intelligence will enable them to analyze greater amounts of our data to discern new behavioral patterns and to predict what we will think and want before we actually think and want it. These companies have only begun to scratch the surface of what is possible with our data.

We are being profiled in incredible and increasingly detailed ways, and our data may be exploited for purposes we cannot yet possibly understand. The old bargain—free Internet services in exchange for targeted advertising—is rapidly become a quaint relic of the past. And with no sense of how, when, or why our data might be used in the future, it is not clear what might take its place.

Obama Tells Israel, Take it or Leave it

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Note: Haaretz is pro Obama regime and anti-Netanyahu
Obama to Israel as Netanyahu Hesitates Over Aid Package: Next Prez Won’t Give You a Better Deal

An unnamed US official urged Israel Sunday to accept a military aid offer which falls short of Israeli expectations, claiming the country would get no better offer from the next administration. According to Haaretz, the official said, “Israel will certainly not find a president more committed to Israel’s security than is President [Barack] Obama.”

Three rounds of talks to renegotiate US contributions to Israel’s military have largely led nowhere. A ten-year memorandum of understanding, signed in 2008, provided Israel with $3 billion annually. It is set to expire in the near future, and US congressional sources told Reuters that Israel is seeking an increase to $5 billion a year, starting in 2017. The same sources estimated the final agreement would settle between $4 and $5 billion.

On Sunday, Israeli Prime Minister Benjamin Netanyahu said during a weekly cabinet meeting, “Perhaps we won’t succeed in reaching an agreement with this administration and will have to reach an agreement with the next administration.” This prompted the angry response from US officials.

“Even as we grapple with a particularly challenging budget environment, this administration’s commitment to Israel’s security is such that we are prepared to sign an MOU [memorandum of understanding] with Israel that would constitute the largest single pledge of military assistance to any country in U.S. history,” the senior official told Haaretz.

“Israel is of course free to wait for the next administration to finalize a new MOU should it not be satisfied with such a pledge, but we would caution that the US budgetary environment is unlikely to improve in the next 1-2 years and Israel will certainly not find a president more committed to Israel’s security than is President Obama.”

The same official emphasized that negotiations are “taking place in the context of a challenging budgetary environment in the United States that has necessitated difficult tradeoffs amongst competing priorities including not just foreign assistance and defense but also domestic spending.” Currently, over 50 percent of America’s foreign military spending goes to Israel.

“Despite these [budgetary] limitations, based on extensive consultations with Israel on its threat environment and in-depth discussions within the U.S. government regarding Israel’s defense needs, we are confident that a new [memorandum] could meet Israel’s top security requirements and preserve its qualitative military edge,” the official added.

White House officials stressed that Israel’s security is a top priority of the Obama administration, as demonstrated by its spending to date. “From the $20.5 billion in Foreign Military Financing to the additional $3 billion in missile defense funding the United States has provided under his leadership, no other U.S. Administration in history has done more for Israel’s security.”

A senior Israeli official noted that, while negotiations are ongoing, it would likely take presidential intervention to make any real progress. “It’s not a subject for staff, but rather for decisions by leaders,” he said. This may happen in the near future, as Defense Minister Moshe Ya’alon is scheduled to visit his American counterpart, Ashton Carter, in Washington next month, followed two weeks later by a visit to the US by Netanyahu, who is expected to meet with Obama at that time.

***

16 Aug 2007

 

A memorandum of understanding (MOU) was signed by Israel and the United States at a ceremony today (16 August) at the Ministry of Foreign Affairs. The MOU outlines defense aid to be provided to Israel by the Americans to the tune of $30 billion in the next decade.

Representing the United States at the ceremony were Undersecretary of State R. Nicholas Burns and US Ambassador to Israel Richard Jones. On the Israeli side, Bank of Israel Governor Stanley Fisher, Director General of the Foreign Ministry Aaron Abramovich, Director General of the Ministry of Defense Pinchas Buchris and Israel’s Ambassador to the United States, Salai Meridor, attended.

*** Contacts between Israel and the United States on the security memorandum of understanding are expected to be stepped up a notch. Defense Minister Moshe Ya’alon is expected to visit Washington at the beginning of March to meet with his American counterpart, Ashton Carter. About two weeks later, Netanyahu will come to Washington to attend the conference of the pro-Israel lobby AIPAC, the American Israel Public Affairs Committee. In all probability, he will also meet with Obama in an effort to achieve a breakthrough in the talks.

Will Kerry Give Mahmoud Abbas a P5+1 Deal?

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ToI: Former Palestinian peace negotiator Nabil Shaath said in an interview earlier this month that he often asks Westerners whether Arabs have to “hijack your planes and destroy your airports again” to make the world take notice of the Palestinian cause

In a February 1 interview with the Palestinian Authority’s Awdha TV, translated by MEMRI, Shaath slammed American efforts at Israeli-Palestinian peacemaking.

Asked about a French proposal for an international peace conference, Shaath replied, “Well, anything is better than American control of the negotiations. Anything. The US has never been a reliable honest broker. Never. It is the strategic ally of Israel. Period. Therefore any discussion of a different formula is a positive thing.”

But, he added, “an international conference is not what is needed. What is needed is a smaller framework. Today, at the African Union summit, President [Mahmoud] Abbas reiterated that we want something similar to the 5+1 framework” of six world powers who negotiated the nuclear deal with Iran.

“Like it or not, the US will be part of it. But we want France, Germany, Britain, the EU, Russia, China, Brazil, India. From the Arab countries we want Egypt at least. We want a small international framework.”

***

Shaath then turned to what he described as Western apathy toward suffering in the Middle East.

“If the Syrian problem had not been exported to Europe through the refugees on the one hand and terrorism on the other, the Europeans would not have cared even if the entire Syrian people had died,” he charged.

“But when all of a sudden there were four million Syrian refugees in Europe, 1.2 million of them in Germany alone, and when this was accompanied by Islamic State operations in France and elsewhere, all these countries began to fear that IS might have infiltrated through the refugees. And this started a debate about racial transformation in Europe with the entrance of non-white, non-European, non-Anglo-Saxon races, like the Syrian refugees, the Africans and others. This is what made the Syrian problem the most pressing from their perspective.”

He added: “I always say to these people, after I tell them about Syria and IS: ‘Do we have to hijack your planes and destroy your airports again to make you care about our cause? Are you waiting for us to cut off your oil supply? You always wait for things to reach boiling point and explode, causing you harm, before you intervene to end the crimes and violations.’”  

Shaath served as the PA’s first foreign minister, and has served as a top peace negotiator and

The DoJ Hacked, DHS Files Compromised

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Hackers leaked DHS staff records, 200GB of files are in their hands

A hacker accessed an employee’s email account at the Department of Justice and stole 200GB of files including records of 9,000 DHS staffers and 20,000 FBI employees.

SecurityAffairs: Yesterday, the data related a Department of Homeland Security (DHS) staff directory were leaked online, a Twitter account shared the link to an archive containing 9,355 names.

The responsible for the data leakage first contacted Motherboard to share the precious archive.

Each record of the DHS Staff Directory includes name, title, email address, and phone number.

Going deep in the archive it is possible to note that it includes information of DHS security specialists, program analysts, InfoSec and IT and also 100 employees with a title “Intelligence”.

The same Twitter account has announced later the imminent release of an additional data dump containing 20,000 FBI employees.

DHS firewall

Are the records authentic?

Motherboard that obtained the archive reached the operations center of the FBI, and in one case the individual who pick up the phone presented himself with the same name associated with that number in the archive. A similar circumstance occurred with a DHS employee, Motherboard so confirmed that the information is legit.

Which is the source of data?

According to Motherboard, a hacker accessed an employee’s email account at the Department of Justice. As proof, the hacker sent the email message to Motherboard’s contributor Joseph Cox directly from the compromised account.

“A hacker, who wishes to remain anonymous, plans to dump the apparent names, job titles, email addresses and phone numbers of over 20,000 supposed Federal Bureau of Investigation (FBI) employees, as well as over 9,000 alleged Department of Homeland Security (DHS) employees, Motherboard has learned.” wrote Cox in a blog post.

“The hacker also claims to have downloaded hundreds of gigabytes of data from a Department of Justice (DOJ) computer, although that data has not been published.”

The hacker first tried to use the compromised credentials to access a DOJ staff portal, but without success, then he called the department directly and obtained the access through social engineering techniques.

The hacker accessed the DoJ intranet where the database is hosted, then he downloaded around the, out of 1TB that he had access to.

“I HAD access to it, I couldn’t take all of the 1TB,” the hacker told to MotherBoard.

The hackers confirmed his intention to release the rest of the data in the near future.Which is the motivation behind the attack?

It is not clear at the moment why the hacker released the archive, surely it’s not financially motivated. The hacker only left the following message when has leaked the data-

“This is for Palestine, Ramallah, West Bank, Gaza, This is for the child that is searching for an answer…” which are the verses of “Long Live Palestine”

The only certainty right now is that similar incidents are becoming too frequent, apparently the government staff is not properly trained on the main cyber threats or the hacking technique. Similar incidents show the lack of knowledge on the most basic security measures.
Whenever a hacker leaks so sensitive data, I think the number of his peers who had access to the same information with the intent to use them in other attacks or resell them, perhaps to a foreign government.

Pierluigi Paganini

*** As a reminder, in 2014 a much more dangerous hack intrusion happened at the DHS:

The Department of Homeland Security (DHS) alerted critical infrastructure operators to recent breaches within the sector – including the hack of a U.S. public utility that was vulnerable to brute-force attacks.

This week, the Industrial Control Systems Cyber Emergency Response Team (ICS-CERT), a subgroup of DHS, revealed information about the incidents in a newsletter (PDF).

According to ICS-CERT, industrial control systems were compromised in two, new incidents: one, involving the hack of an unnamed public utility, and another scenario where a control system server was remotely accessed by a “sophisticated threat actor.”

After investigating the public utility hack, ICS-CERT found that the system’s authentication mechanism was susceptible to brute-force attacks – where saboteurs routinely run through a list of passwords or characters to gain access to targeted systems. The control system used a simple password mechanism, the newsletter revealed.

In