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Government Aims to Protect Other Ongoing Investigations in MalwareTech Case

In its request for a protection order governing discovery materials turned over to the defense in the Marcus Hutchins/MalwareTech case, the government provided this explanation of things it needed to keep secret.

The discovery in this matter may include information related to other ongoing investigations, malware, and investigative techniques employed by the United States during its investigation of Mr. Hutchins and others.

The government will always aim to protect investigative techniques — though in an international case investigating hackers, those techniques might well be rather interesting. Of particular interest, the government wants to hide techniques it may have used against Hutchins … and against others.

The government’s claim it needs to hide information on malware will disadvantage researchers who are analyzing the Kronos malware in an attempt to understand whether any code Hutchins created could be deemed to be original and necessary to the tool. For example, Polish researcher hasherezade showed that the hooking code Hutchins complained had been misappropriated from him in 2015, when the government claims he was helping his co-defendant revise Kronos, was not actually original to him.

The interesting thing about this part of Kronos is its similarity with a hooking engine described by MalwareTech on his blog in January 2015. Later, he complained in his tweet, that cybercriminals stolen and adopted his code. Looking at the hooking engine of Kronos we can see a big overlap, that made us suspect that this part of Kronos could be indeed based on his ideas. However, it turned out that this technique was described much earlier (i.e. here//thanks to  @xorsthings for the link ), and both authors learned it from other sources rather than inventing it.

Hasherezade may well have proven a key part of the government’s argument wrong here. Or she may be missing some other piece of code the government claims comes from Hutchins. By hiding any discussions about what code the government is actually looking at, though, it prevents the security community from definitely undermining the claims of the government, at least before trial.

Finally, there’s the reference to other, ongoing investigations.

One investigation of interest might be the Kelihos botnet. In the April complaint against Pyotr Levashov, the government claimed that the Kelihos botnet had infected victims with Kronos malware.

In addition to using Kelihos to distribute spam, the Defendant also profits by using Kelihos to directly install malware on victim computers. During FBI testing, Kelihos was observed installing ransomware onto a test machine, as well as “Vawtrak” banking Trojan (used to steal login credentials used at financial institutions), and a malicious Word document designed to infect the computer with the Kronos banking Trojan.

Unlike known uses of Kronos by itself, Kelihos is something that has victimized people in the United States; the government has indicted and is trying to extradite Pyotr Levashov in that case. So that may be one investigation the government is trying to protect.

It’s also possible that, in an effort to pressure Hutchins to take a plea deal, the government is investigating allegations he engaged in other criminal activity, activity that would more directly implicate him in criminal hacking. There’s little (aside from statutes of limitation) to prevent the government from doing that, and their decision to newly declare the case complex may suggest they’re threatening more damaging superseding indictments against Hutchins, if they can substantiate those allegations, to pressure him to take a plea deal.

Finally, there’s WannaCry. As I noted, while the government lifted some of the more onerous bail conditions on Hutchins, they added the restriction that he not touch the WannaCry sinkhole he set up in May. The reference to ongoing investigations may suggest the government will be discussing aspects of that investigation with Hutchins’ defense team, but wants to hide those details from the public.

Update: I’ve corrected the language regarding Kelihos to note that this doesn’t involve shared code. h/t ee for finding the reference.

Marcy Wheeler is an independent journalist writing about national security and civil liberties. She writes as emptywheel at her eponymous blog, publishes at outlets including Vice, Motherboard, the Nation, the Atlantic, Al Jazeera, and appears frequently on television and radio. She is the author of Anatomy of Deceit, a primer on the CIA leak investigation, and liveblogged the Scooter Libby trial.

Marcy has a PhD from the University of Michigan, where she researched the “feuilleton,” a short conversational newspaper form that has proven important in times of heightened censorship. Before and after her time in academics, Marcy provided documentation consulting for corporations in the auto, tech, and energy industries. She lives with her spouse in Grand Rapids, MI.

Government Changes Its Tune about MalwareTech

Marcus Hutchins, AKA MalwareTech, just plead not guilty at his arraignment in Milwaukee, WI. After the hearing, his attorney, Marcia Hofmann, called him a “hero” and said he would be fully vindicated.

A dramatic change in the tone of the government suggested that might well be the case. Whereas at Hutchins’ Las Vegas hearing, the government used his appearance at a tourist-focused gun range in an attempt to deny him bail, here, the government was amenable to lifting many of the restrictions on his release conditions. Hutchins will be able to live in Los Angeles, where his other attorney, Brian Klein, is. He will be able to continue working. He can travel throughout the US, though he cannot leave the country (though his defense tried to get him released to the UK).

About the only major restriction — aside from GPS monitoring and monitoring by pretrial services — is that he can’t touch the WannaCry sinkhole.

The government’s attorney, Michael Chmelar, described Hutchins’ alleged crimes as “historic,” a seeming concession that he’s not currently a threat. That said, while the government had not deemed this a complex crime when they indicted Hutchins back on July 11, Chmelar said he expected they would do so in the coming weeks. The trial is currently scheduled for October, but with a complex designation, that will slide.

Chmelar said that they had or would turn over today both Hutchins’ FBI interview, as well as two other recorded phone calls. The rest of discovery will be delayed until the defense signs a protection order.

Perhaps the funniest part of the hearing came when the lawyers tried to help Magistrate William Duffin understand what a “sinkhole” is.

Update: Fixed spelling of Hofmann’s last name–sorry Marcia!

Update: Forgot to mention — the case was assigned to JP Stadtmueller, a 75-year old Reagan appointee, formerly the Chief Judge of EDWI.

Marcy Wheeler is an independent journalist writing about national security and civil liberties. She writes as emptywheel at her eponymous blog, publishes at outlets including Vice, Motherboard, the Nation, the Atlantic, Al Jazeera, and appears frequently on television and radio. She is the author of Anatomy of Deceit, a primer on the CIA leak investigation, and liveblogged the Scooter Libby trial.

Marcy has a PhD from the University of Michigan, where she researched the “feuilleton,” a short conversational newspaper form that has proven important in times of heightened censorship. Before and after her time in academics, Marcy provided documentation consulting for corporations in the auto, tech, and energy industries. She lives with her spouse in Grand Rapids, MI.

Marcus Hutchins, the Word of God

Motherboard obtained the hearing transcript from Marcus Hutchins (AKA MalwareTech) court hearing on August 4. It reveals precisely the oblique language Prosecutor Dan Cowhig actually used, which got reported very differently, to explain Hutchins’ alleged admission to have authored the Kronos malware.

In his interview following his arrest, Mr. Hutchins admitted that he was the author of the code that became the Kronos malware and admitted that he had sold that code to another.

Compare that to this allegation, in Hutchins’ indictment.

It’s a very different thing to create code that may make up part of a package that would be sold on AlphaBay as malware and to write code that makes up part of the code ultimately packaged and sold as malware. It seems likely the government overstated what they had evidence of in the indictment (and, one wonders, to the grand jury), which might, in turn, significantly alter questions of intent.

Even with the government’s claim that Hutchins discussed getting paid for his code in chat logs (we’ll see about their provenance and accuracy after Hutchins goes broke trying to pay the bills in WI without a job, I guess), it’s not entirely clear the government even claims to have evidence that Hutchins wanted to sell a tool to rip off banks.

Which means that any eventual trial (assuming Hutchins doesn’t plea out of desperation) may turn on textual analysis of what it was some agents in WI bought off the dark web and what Hutchins coded years ago.

Marcy Wheeler is an independent journalist writing about national security and civil liberties. She writes as emptywheel at her eponymous blog, publishes at outlets including Vice, Motherboard, the Nation, the Atlantic, Al Jazeera, and appears frequently on television and radio. She is the author of Anatomy of Deceit, a primer on the CIA leak investigation, and liveblogged the Scooter Libby trial.

Marcy has a PhD from the University of Michigan, where she researched the “feuilleton,” a short conversational newspaper form that has proven important in times of heightened censorship. Before and after her time in academics, Marcy provided documentation consulting for corporations in the auto, tech, and energy industries. She lives with her spouse in Grand Rapids, MI.

[Photo: National Security Agency, Ft. Meade, MD via Wikimedia]

Rick Ledgett’s Straw Malware

For some reason, over a month after NotPetya and almost two months after WannaCry, former Deputy DIRNSA Rick Ledgett has decided now’s the time to respond to them by inventing a straw man argument denying the need for vulnerabilities disclosure. In the same (opening) paragraph where he claims the malware attacks have revived calls for the government to release all vulnerabilities, he accuses his opponents of oversimplification.

The WannaCry and Petya malware, both of which are partially based on hacking tools allegedly developed by the National Security Agency, have revived calls for the U.S. government to release all vulnerabilities that it holds.  Proponents argue this will allow for the development of patches, which will in turn ensure networks are secure.  On the face of it, this argument might seem to make sense, but it is actually a gross oversimplification of the problem, would not have the desired effect, and would in fact be dangerous.

Yet it’s Ledgett who is oversimplifying. What most people engaging in the VEP debate — even before two worms based, in part, on tools stolen from NSA — have asked for is for some kind of sense and transparency on the process by which NSA reviews vulnerabilities for disclosure. Ledgett instead poses his opponents as absolutists, asking for everything to be disclosed.

Ledgett then spends part of his column claiming that WannaCry targeted XP.

Users agree to buy the software “as is” and most software companies will attempt to patch vulnerabilities as they are discovered, unless the software has been made obsolete by the company, as was the case with Windows XP that WannaCry exploited.

[snip]

Customers who buy software should expect to have to patch it and update it to new versions periodically.

Except multiple reports said that XP wasn’t the problem, Windows 7 was. Ledgett’s mistake is all the more curious given reports that EternalBlue was blue screening at NSA when — while he was still at the agency — it was primarily focused on XP. That is, Ledgett is one of the people who might have expected WannaCry to crash XP; that he doesn’t even when I do doesn’t say a lot for NSA’s oversight of its exploits.

Ledgett then goes on to claim that WannaCry was a failed ransomware attack, even though that’s not entirely clear.

At least he understands NotPetya better, noting that the NSA component of that worm was largely a shiny object.

In fact, the primary damage caused by Petya resulted from credential theft, not an exploit.

The most disturbing part of Ledgett’s column, however, is that it takes him a good eight (of nine total) paragraphs to get around to addressing what really has been the specific response to WannaCry and NotPetya, a response shared by people on both sides of the VEP debate: NSA needs to secure its shit.

Some have made the analogy that the alleged U.S. government loss of control of their software tools is tantamount to losing control of Tomahawk missile systems, with the systems in the hands of criminal groups threatening to use them.  While the analogy is vivid, it incorrectly places all the fault on the government.  A more accurate rendering would be a missile in which the software industry built the warhead (vulnerabilities in their products), their customers built the rocket motor (failing to upgrade and patch), and the ransomware is the guidance system.

We are almost a full year past the day ShadowBrokers first came on the scene, threatening to leak NSA’s tools. A recent CyberScoop article suggests that, while government investigators now have a profile they believe ShadowBrokers matches, they’re not even entirely sure whether they’re looking for a disgruntled former IC insider, a current employee, or a contractor.

The U.S. government’s counterintelligence investigation into the so-called Shadow Brokers group is currently focused on identifying a disgruntled, former U.S. intelligence community insider, multiple people familiar with the matter told CyberScoop.

[snip]

While investigators believe that a former insider is involved, the expansive probe also spans other possibilities, including the threat of a current intelligence community employee being connected to the mysterious group.

[snip]

It’s not clear if the former insider was once a contractor or in-house employee of the secretive agency. Two people familiar with the matter said the investigation “goes beyond” Harold Martin, the former Booz Allen Hamilton contractor who is currently facing charges for taking troves of classified material outside a secure environment.

At least some of Shadow Brokers’ tools were stolen after Edward Snowden walked out of NSA Hawaii with the crown jewels, at a time when Rick Ledgett, personally, was leading a leak investigation into NSA’s vulnerabilities. And yet, over three years after Snowden stole his documents, the Rick Ledgett-led NSA still had servers sitting unlocked in their racks, still hadn’t addressed its privileged user issues.

Rick Ledgett, the guy inventing straw man arguments about absolutist VEP demands is a guy who’d do the country far more good if he talked about what NSA can do to lock down its shit — and explained why that shit didn’t get locked down when Ledgett was working on those issues specifically.

But he barely mentions that part of the response to WannaCry and NotPetya.

Marcy Wheeler is an independent journalist writing about national security and civil liberties. She writes as emptywheel at her eponymous blog, publishes at outlets including Vice, Motherboard, the Nation, the Atlantic, Al Jazeera, and appears frequently on television and radio. She is the author of Anatomy of Deceit, a primer on the CIA leak investigation, and liveblogged the Scooter Libby trial.

Marcy has a PhD from the University of Michigan, where she researched the “feuilleton,” a short conversational newspaper form that has proven important in times of heightened censorship. Before and after her time in academics, Marcy provided documentation consulting for corporations in the auto, tech, and energy industries. She lives with her spouse in Grand Rapids, MI.

The Kronos Needle in the AlphaBay Haystack

To set up a future post (see my earlier posts here and here), I want to show how remarkable it is that the Feds decided to prosecute Marcus Hutchins, a guy who allegedly contributed code to a piece of malware sold in June 2015 for $2,000 on AlphaBay, out of all the illicit sales they might have chosen to prosecute in the month after taking the site down.

First, let’s look at the Alexandre Cazes indictment, sworn by a Fresno Grand Jury on June 1, 2017, 41 days before the Hutchins indictment. It lists the following illicitly sold goods.

  • Redacted month 2015, redacted vendor sells a false driver license to an undercover officer in CA
  • Redacted month 2015, redacted vendor sells an ATM skimmer to an undercover officer in CA
  • Redacted month 2015, redacted vendor sells an ATM skimmer to an undercover officer in CA
  • December 29, 2015, vendor CC4L sells marijuana to MG, an undercover officer, which is mailed from Merced to Buffalo
  • Redacted short month date 2016, redacted vendor sells marijuana to an undercover officer, which is mailed from Los Angeles to a redacted city
  • Redacted month 2016, redacted vendor sells a false driver license to an undercover officer in CA
  • Redacted month 2016, redacted vendor sells a false driver license to an undercover officer in CA
  • Redacted month 2016, redacted vendor sells a false driver license to an undercover officer in CA
  • May 16, 2016, vendor A51 sells heroin to an undercover officer, which is mailed from Brooklyn to Fresno
  • May 24, 2016, vendor A51 sells heroin to an undercover officer, which is mailed from Brooklyn to Fresno
  • October 20, 2016, vendor BSB sells heroin and fentanyl to an undercover officer, which is mailed from San Francisco to Fresno
  • Redacted (short month) date 2017, redacted vendor sells meth to an undercover officer, which is mailed between two CA cities

The sale of a piece of malware for $2,000 on June 11, 2015 would be earlier than most of those listed in the indictment that brought AlphaBay’s operator down. And while there are several ATM skimmers listed (a violation of 18 USC 1029) there is no malware listed (in two of Hutchins’ charges listed as violations of 18 USC 1030, the CFAA statute).

Now look at the overall numbers FBI boasted for AlphaBay when it announced its takedown on July 20, nine days after the indictment targeting Hutchins.

AlphaBay reported that it serviced more than 200,000 users and 40,000 vendors. Around the time of takedown, the site had more than 250,000 listings for illegal drugs and toxic chemicals, and more than 100,000 listings for stolen and fraudulent identification documents, counterfeit goods, malware and other computer hacking tools, firearms, and fraudulent services. By comparison, the Silk Road dark market—the largest such enterprise of its kind before it was shut down in 2013—had approximately 14,000 listings.

The operation to seize AlphaBay’s servers was led by the FBI and involved the cooperative efforts of law enforcement agencies in Thailand, the Netherlands, Lithuania, Canada, the United Kingdom, and France, along with the European law enforcement agency Europol.

“Conservatively, several hundred investigations across the globe were being conducted at the same time as a result of AlphaBay’s illegal activities,” Phirippidis said. “It really took an all-hands effort among law enforcement worldwide to deconflict and protect those ongoing investigations.”

Of the 40,000 vendors charged within a month of takedown, of the 250K drug listings and the 100K fraudulent services listings, the guy who sold Kronos once for $2,000 (whom Tom Fox-Brewster thinks might be a guy named VinnyK) — and by virtue of American conspiracy laws, Hutchins — were among the first 20 or so known to be charged for using AlphaBay.

Admittedly, we’re seeing EDCA’s sales in Cazes’ indictment because they had the lead on the overall takedown. Perhaps EDWI has 1,000 more malware buys it will get around to charging, as soon as its perpetrators decide to come to the US, as Hutchins did.

But put in this light, it looks even more remarkable how quickly they got around to arresting to the alleged co-conspirator of a guy who sold a piece of malware.

Marcy Wheeler is an independent journalist writing about national security and civil liberties. She writes as emptywheel at her eponymous blog, publishes at outlets including Vice, Motherboard, the Nation, the Atlantic, Al Jazeera, and appears frequently on television and radio. She is the author of Anatomy of Deceit, a primer on the CIA leak investigation, and liveblogged the Scooter Libby trial.

Marcy has a PhD from the University of Michigan, where she researched the “feuilleton,” a short conversational newspaper form that has proven important in times of heightened censorship. Before and after her time in academics, Marcy provided documentation consulting for corporations in the auto, tech, and energy industries. She lives with her spouse in Grand Rapids, MI.

MalwareTech’s FBI-Induced Tour to Milwaukee, WI

On Friday, WannaCry hero Marcus Hutchins (AKA MalwareTech) was granted bail by a Las Vegas judge; he will pay his bail on Monday, then have to travel, without a passport to show TSA, to Milwaukee for a court appearance Tuesday (I’m contemplating hopping the ferry for the hearing).

I’d like to focus on the venue, how it is that a British malware researcher came to be charged in Flyover USA for the crime of making malware.

Thomas Brewster-Fox wrote an important piece on Friday trying to figure out what a lot of people have been asking: what is Kronos, which a lot of researchers never really heard of. He notes that the malware was a bust in the criminal malware market.

The reduced price hints at another truth about Kronos: it was largely a failure amongst serious cybercriminals. There was early anticipation in 2014 it could go big, as prolific and profitable as one of its forbears, the banking malware known as Zeus. In an email to your reporter from RSA’s Daniel Cohen in 2014, he wrote: “Waiting to see whether Kronos turns into something. At this point it’s just a post on a forum, no sample or binary yet. It could be an interesting development if it does, as it would point to more movement away from the Zeus code.”

In the last 24 months, according to IBM global executive security advisor Limor Kessem, the Trojan emerged with a hefty $7,000 price tag in mid-2014, but actual attacks didn’t launch until the third and fourth quarter of 2015, when the company saw some Kronos malware campaigns hitting UK banks. “But after that timeframe, have not seen much more activity from the malware,” Kessem told Forbes.

“The very last time we saw Kronos activity was a small campaign in November 2016, when Kronos infected a very small number of machines mostly in Brazil, the UK, Japan, and Canada. At that particular time, we did not see fraudulent activity from Kronos, but rather, believe it was used a loader for other malware.

Importantly, IBM global executive security advisor Limor Kessem names the few places where the malware has been deployed: Some UK banks in the last two quarters of 2015 and then, in altered form and function, in a “very small number of machines” in Brazil, UK, Japan, and Canada.

So: UK, Brazil, UK, Japan, and Canada.

Not the US, as far as Kessem notes.

And in fact, the most commonly cited victim, the UK, is where Hutchins is from! Yet among the things the British National Cyber Security Centre — the folks who worked closely with Hutchins as he saved a bunch of NHS hospitals from being shut down due to the WannaCry malware — has been really circumspect about since Hutchins’ arrest is what the case is doing over here in the States.

We are aware of the situation. This is a law enforcement matter and it would be inappropriate to comment further.

So why are we seeing this case in the US — in Milwaukee, of all places?!?! — rather than in the UK where some of its few victims are?

The indictment against Hutchins includes just two actions he is alleged to have taken personally.

Defendant MARCUS HUTCHINS created the Kronos malware. (¶4a)

[snip]

In or around February 2015, defendants MARCUS HUTCHINS and [redacted] updated the Kronos malware. (¶4d)

All the other overt actions described in the indictment were done by Hutchins’ as yet unknown (even to him, per reports!) and still at-large co-defendant. That includes this action:

On or about June 11, 2015, defendant [redacted] sold a version of the Kronos malware in exchange for approximately $2,000 in digital currency. [emphasis mine]

Most the other charges — counts three through six — cite that June 11 sale. So it’s that sale, in which Hutchins was not alleged to be involved and the alleged perpetrator of which hasn’t yet been arrested, that seems to be the core of the crime.

This Beeb article, by far the most detailed accounting of Hutchins’ arraignment, provides these details.

Prosecutors told a Las Vegas court on Friday that Mr Hutchins had been caught in a sting operation when undercover officers bought the code.

They claimed the software was sold for $2,000 in digital currency in June 2015.

Dan Cowhig, prosecuting, also told the court that Mr Hutchins had made a confession during a police interview.

“He admitted he was the author of the code of Kronos malware and indicated he sold it,” said Mr Cowhig.

The lawyer claimed there was evidence of chat logs between Mr Hutchins and an unnamed co-defendant – who has yet to be arrested – where the security researcher complained of not receiving a fair share of the money.

From this, it might be safe to assume that some law enforcement officer, possibly working undercover in the Eastern District of WI, bought a bunch of shit off AlphaBay in 2015, including a copy of (a version of) the Kronos malware. The purchase (and the version of code) wasn’t sufficiently interesting last year to arrest Hutchins when (I believe) he came for the Las Vegas cons.

Nor was it interesting enough to the UK, where some of Kronos’ few victims are, to prosecute the sale (which, because conspiracy laws are not as broad as they are here in the US, might not have reached Hutchins in any case, and certainly wouldn’t have exposed him to decades of incarceration).

But this year, in the days after the Alpha Bay seizure (and several months after Hutchins helped to shut down WannaCry), prosecutors presented that $2000 sale to a grand jury in ED WI, after which an arrest warrant was sent out to Las Vegas, just in time to arrest Hutchins on his way out of the country, after most the unruly hackers had departed from Las Vegas.

Arresting Hutchins only as he left — and playing whack-a-mole moving him from one detention center to another — gave authorities the opportunity to interview Hutchins without an attorney, where — prosecutor Dan Cowhig claims, Hutchins “made a confession,” — not that he “created the Kronos malware,” which is what the indictment alleges, but instead that he “was the author of the code of Kronos malware.” That “confession” sounds like the kind of thing an overly helpful person might explain if asked to explain this tweet in circumstances where he didn’t have a lawyer.

So here’s what may be going on.

In the aftermath of the AlphaBay seizure, authorities in the US decided to wade through what they could charge from past purchases off the marketplace, and either remembered or stumbled on this remarkably minor sale. Perhaps because of Hutchins’ fame, or perhaps because someone is unhappy about Hutchins’ fame, it was prioritized in a way it otherwise would not have been. And, as always, the US used convenient travel as a way to nab foreign alleged hackers to pull into America’s far more onerous than its allies criminal justice system.

It’s not even clear, however, that that explains the Milwaukee venue. Recall that DOJ first charged Pyotr Levashov (and therefore first deployed its now legally sanctioned Rule 41 warrant) for the Kelihos botnet in Alaska, even though he’ll be tried in CT if he’s ever extradited to the US. The FBI reorganized the way they investigate cyber crimes in 2014 (no longer tying the investigation to the geography of the crime) and with Rule 41 and international crimes, they’ll be able to do so far more in the future. But at least with Levashov, there were victims referenced in the complaint, whereas here, the only act that may have taken place in ED WI is that purchase, if it even did.

All that said, the venue is a far less interesting question than whether the FBI really has evidence tying Hutchins to intending his code to be used for malware, or if they’ve just made a horrible mistake.

Marcy Wheeler is an independent journalist writing about national security and civil liberties. She writes as emptywheel at her eponymous blog, publishes at outlets including Vice, Motherboard, the Nation, the Atlantic, Al Jazeera, and appears frequently on television and radio. She is the author of Anatomy of Deceit, a primer on the CIA leak investigation, and liveblogged the Scooter Libby trial.

Marcy has a PhD from the University of Michigan, where she researched the “feuilleton,” a short conversational newspaper form that has proven important in times of heightened censorship. Before and after her time in academics, Marcy provided documentation consulting for corporations in the auto, tech, and energy industries. She lives with her spouse in Grand Rapids, MI.

Three Things: Mas Gas, Las Vegas and Sass

I’m not even going to touch the massive stream of news out of Washington over the last 24 hours, from the Washington Post piece featuring ‘leaked’ transcripts of Trump’s whack doodle conversations with Mexico’s and Australia’s presidents to the impaneled grand jury and subpoenas. Plenty of other material not getting adequate air time.

Speaking of air time, hope you have a chance to catch Marcy on Democracy Now. She spoke with Amy Goodman about the confirmation of Chris Wray as FBI Director as well as former Fox News contributor Rod Wheeler’s lawsuit against Fox News.

Onward…

~ 3 ~

Venezuela’s state-run oil producer PDVSA is cutting oil sales to U.S. refining unit Citgo Petroleum. At the same time it is increasing shipments of oil to Russia’s largest oil producer, Rosneft. Venezuela is using its oil to pay down a $1.6 billion loan extended to PDVSA last year. Rosneft has loaned an even larger sum of money in the not-too-distant past, but the terms aren’t known; payments in oil as well as a hefty minority stake in Citgo were believed to be included in negotiations.

The threat to U.S. gasoline supply: though at lower levels than a decade ago, Venezuela is the third largest supplier of oil to the U.S.

Citgo has, however, been shifting its purchasing wider afield than just PDVSA:

Citgo last year started sending gasoline and other fuels to Venezuela in exchange for a portion of its crude supply. But Citgo has increased the volume of U.S. oil it refines, and has also has also expanded its crude import sources.
[…]
U.S. President Donald Trump’s administration has promised strong economic sanctions against Venezuela’s government after a Constituent Assembly was elected last week in what United States called a “sham” vote. The new body will have power to rewrite the constitution and abolish the opposition-led Congress.

If those sanctions were to constrain Venezuela’s oil shipments to the United States, Citgo could be ahead of its competitors in finding new supply sources.

The public will feel at the pump whatever happens to Citgo and other gasoline producers. Gasoline prices are already $0.16-0.24 per gallon higher than they were last year.

Who is profiting from this?

~ 2 ~

I’ve been thinking about the tagline, “What happens in Vegas, stays in Vegas” right about now after the arrest of Marcus Hutchins, a.k.a. MalwareTechBlog following Defcon’s end in Las Vegas. You’ve probably read Marcy’s piece already (catch up if you didn’t); since she published her post the information security community has been digging into Hutchins’ past and stewing about why/what/how.

Some speculate this was an aggressive recruitment effort; this might explain why the U.K. didn’t arrest him before he left for Defcon. Or did the U.K. and the U.S. agree not to spook any Defcon attendees by stopping Hutchins before he arrived in Vegas? Responses by U.K. authorities are annoyingly banal:

A spokesman for the Foreign and Commonwealth Office said: “We are in touch with local authorities in Las Vegas following reports of a British man being arrested.”

The UK’s National Crime Agency said: “We are aware a UK national has been arrested but it’s a matter for the authorities in the US.”

Others speculate he was framed as the target of revenge by someone caught up in Alphabay’s seizure. How does shutting down WannaCry fit into this scenario?

I don’t have a favorite theory right now. All I know is that WannaCry’s heat map sticks in my craw.

One thing which should come out of this situation is a dialog about coding, malware, and intent; the infosec community is having that discussion now, but it needs to be wider. If a white hat codes malware in part or whole to investigate capabilities, they are only separated from criminal malware producers/sellers/distributors by intent. How does law enforcement determine intent?

~ 1 ~

Your opinion is constantly shaped by the media you consume. Some consumers aren’t conscious of this shaping; neither are some producers.

And some producers know it but are just plain jerks.

A very important way in which opinion is shaped is by the perspective presenting a viewpoint. If only the members of one-half of the population ever gets a chance to present a perspective, consumers’ opinions are narrowed by that same factor. This is why gender equity in media is critical; if you’re only hearing men you’re not getting but part of the picture.

WIRED magazine knows that gender equity in content is important, but their last issue contained only male-written content. As a twisted tribute to the women who helped produce the issue, WIRED stuck a colophon listing important females.

Including a dog.

Really? The women of WIRED are on the same footing as a pet?

Somebody/ies at WIRED need a kick in the sass; I don’t give a fig if half the staff is female if the content itself is all-male. I’m going to do my best this next month not to cite WIRED.

Don’t think for a moment this is just WIRED, either. The VIDA Count measures annually gender equity in literary arts. There’s progress though slow.

~ 0 ~

That’s a wrap on this open thread. Let’s hope with Tiny Hands McGolfer on vacation that news slows a bit as we enter this weekend. I’m not holding my breath though. Behave.

Blogger since 2002, political activist since 2003, geek since birth. Opinions informed by mixed-race, multi-ethnic, cis-female condition, further shaped by kind friends of all persuasions. Sci-tech frenemy, wannabe artist, decent cook, determined author, successful troublemaker. Mother of invention and two excessively smart-assed young adult kids. Attended School of Hard Knocks; Rather Unfortunate Smallish Private Business School in Midwest; Affordable Mid-State Community College w/evening classes. Self-employed at Tiny Consulting Business; previously at Large-ish Chemical Company with HQ in Midwest in multiple marginalizing corporate drone roles, and at Rather Big IT Service Provider as a project manager, preceded by a motley assortment of gigs before the gig economy was a thing. Blogging experience includes a personal blog at the original blogs.salon.com, managing editor for a state-based news site, and a stint at Firedoglake before landing here at emptywheel as technology’s less-virginal-but-still-accursed Cassandra.

FBI Busts the Guy Who Saved the World from NSA’s Malware

Yesterday, the FBI arrested Marcus Hutchins as he was leaving Las Vegas after Black Hat/Defcon.

Hutchins is best known as the malware researcher, MalwareTechBlog, who inadvertently saved the world from NSA’s repurposed hacking tools by registering what has been assumed to be the sand boxing domain, effectively turning it into a killswitch.

But the government accuses him of making the Kronos banking malware sold on AlphaBay. In an indictment signed July 11 (6 days after AlphaBay got seized and), the government asserts simply that Hutchins made the malware. Motherboard first reported the arrest.

It also accuses him of conspiring with a co-defendant whose name is redacted, going back to July 2014, of selling it.

There’s a lot of skepticism about this indictment in the infosec community, in part because no one took Hutchins for a black hat, though others point to a past identity under which he may have engaged in carding. Plus, the timing is curious. The press release for the arrest notes “the Kronos banking Trojan … was first made available through certain internet forums in early 2014.”

On July 13, 2014, Hutchins put out an ask for a sample of the malware.

That’s also the day the indictment describes an advertising video first being posted to AlphaBay on how Kronos worked.

In remarkably timed news, between 3:10 and 3:25 AM UTC this morning (8 PM last night Mountain Time), someone emptied out all the WannaCry accounts.

Marcy Wheeler is an independent journalist writing about national security and civil liberties. She writes as emptywheel at her eponymous blog, publishes at outlets including Vice, Motherboard, the Nation, the Atlantic, Al Jazeera, and appears frequently on television and radio. She is the author of Anatomy of Deceit, a primer on the CIA leak investigation, and liveblogged the Scooter Libby trial.

Marcy has a PhD from the University of Michigan, where she researched the “feuilleton,” a short conversational newspaper form that has proven important in times of heightened censorship. Before and after her time in academics, Marcy provided documentation consulting for corporations in the auto, tech, and energy industries. She lives with her spouse in Grand Rapids, MI.

The Compartments in WaPo’s Russian Hack Magnum Opus

The WaPo has an 8300 word opus on the Obama Administration’s response to Russian tampering in the election. The article definitely covers new ground on the Obama effort to respond while avoiding making things worse, particularly with regards to imposing sanctions in December. It also largely lays out much of the coverage the three bylined journalists (Greg Miller, Ellen Nakashima, and Adam Entous) have broken before, with new details. The overall message of the article, which has a number of particular viewpoints and silences, is this: Moscow is getting away with their attack.

“[B]ecause of the divergent ways Obama and Trump have handled the matter, Moscow appears unlikely to face proportionate consequences.”

The Immaculate Interception: CIA’s scoop

WaPo starts its story about how Russia got away with its election op with an exchange designed to make the non-response to the attack seem all the more senseless. It provides a dramatic description of a detail these very same reporters broke on December 9: Putin, who was personally directing this effort, was trying to elect Trump.

Early last August, an envelope with extraordinary handling restrictions arrived at the White House. Sent by courier from the CIA, it carried “eyes only” instructions that its contents be shown to just four people: President Barack Obama and three senior aides.

Inside was an intelligence bombshell, a report drawn from sourcing deep inside the Russian government that detailed Russian President Vladi­mir Putin’s direct involvement in a cyber campaign to disrupt and discredit the U.S. presidential race.

[snip]

The material was so sensitive that CIA Director John Brennan kept it out of the President’s Daily Brief, concerned that even that restricted report’s distribution was too broad. The CIA package came with instructions that it be returned immediately after it was read.

[snip]

In early August, Brennan alerted senior White House officials to the Putin intelligence, making a call to deputy national security adviser Avril Haines and pulling national security adviser Susan Rice side after a meeting before briefing Obama along with Rice, Haines and McDonough in the Oval Office.

While the sharing of this information with just three aides adds to the drama, WaPo doesn’t consider something else about it. The inclusion of Rice and McDonough totally makes sense. But by including Avril Haines, Brennan was basically including his former Deputy Director who had moved onto the DNSA position, effectively putting two CIA people in a room with two White House people and the President. Significantly, Lisa Monaco — who had Brennan’s old job as White House Homeland Security Czar and who came from DOJ and FBI before that — was reportedly excluded from this initial briefing.

There are a number of other interesting details about all this. First, for thousands of wordspace, the WaPo presents this intelligence as irreproachable, even while providing this unconvincing explanation of why, if it is so secret and solid, the CIA was willing to let WaPo put it on its front page.

For spy agencies, gaining insights into the intentions of foreign leaders is among the highest priorities. But Putin is a remarkably elusive target. A former KGB officer, he takes extreme precautions to guard against surveillance, rarely communicating by phone or computer, always running sensitive state business from deep within the confines of the Kremlin.

The Washington Post is withholding some details of the intelligence at the request of the U.S. government.

If this intelligence is so sensitive, why is even the timing of its collection being revealed here, much less its access to Putin?

That seemingly contradictory action is all the more curious given that not all agencies were as impressed with this intelligence as CIA was. It’s not until much, much later in its report until WaPo explains what remains true as recently as Admiral Rogers’ latest Congressional testimony: the NSA wasn’t and isn’t as convinced by CIA’s super secret intelligence as CIA was.

Despite the intelligence the CIA had produced, other agencies were slower to endorse a conclusion that Putin was personally directing the operation and wanted to help Trump. “It was definitely compelling, but it was not definitive,” said one senior administration official. “We needed more.”

Some of the most critical technical intelligence on Russia came from another country, officials said. Because of the source of the material, the NSA was reluctant to view it with high confidence.

By the time this detail is presented, the narrative is in place: Obama failed to respond adequately to the attack that CIA warned about back in August.

The depiction of this top-level compartment of just Brennan, Rice, McDonough, and Haines is interesting background, as well, for the depiction of the way McDonough undermined a State Department plan to institute a Special Commission before Donald Trump got started.

Supporters’ confidence was buoyed when McDonough signaled that he planned to “tabledrop” the proposal at the next NSC meeting, one that would be chaired by Obama. Kerry was overseas and participated by videoconference.

To some, the “tabledrop” term has a tactical connotation beyond the obvious. It is sometimes used as a means of securing approval of an idea by introducing it before opponents have a chance to form counterarguments.

“We thought this was a good sign,” a former State Department official said.

But as soon as McDonough introduced the proposal for a commission, he began criticizing it, arguing that it would be perceived as partisan and almost certainly blocked by Congress.

Obama then echoed McDonough’s critique, effectively killing any chance that a Russia commission would be formed.

Effectively, McDonough upended the table on those (which presumably includes the CIA) who wanted to preempt regular process.

Finally, even after  these three WaPo journalists foreground their entire narrative with CIA’s super duper scoop (that NSA is still not 100% convinced is one), they don’t describe their own role in changing the tenor of the response on December 9 by reporting the first iteration of this story.

“By December, those of us working on this for a long time were demoralized,” said an administration official involved in the developing punitive options.

Then the tenor began to shift.

On Dec. 9, Obama ordered a comprehensive review by U.S. intelligence agencies of Russian interference in U.S. elections going back to 2008, with a plan to make some of the findings public.

The WaPo’s report of the CIA’s intelligence changed the tenor back in December, and this story about the absence of a response might change the tenor here.

Presenting the politics ahead of the intelligence

The WaPo’s foregrounding of Brennan’s August scoop is also important for the way they portray the parallel streams of the intelligence and political response. It portrays the Democrats’ political complaints about Republicans in this story, most notably the suggestion that Mitch McConnell refused to back a more public statement about the Russian operation when Democrats were pushing for one in September. That story, in part because of McConnell’s silence, has become accepted as true.

Except the WaPo’s own story provides ample evidence that the Democrats were trying to get ahead of the formal intelligence community with respect to attribution, both in the summer, when Clapper only alluded to Russian involvement.

Even after the late-July WikiLeaks dump, which came on the eve of the Democratic convention and led to the resignation of Rep. Debbie Wasserman Schultz (D-Fla.) as the DNC’s chairwoman, U.S. intelligence officials continued to express uncertainty about who was behind the hacks or why they were carried out.

At a public security conference in Aspen, Colo., in late July, Director of National Intelligence James R. Clapper Jr. noted that Russia had a long history of meddling in American elections but that U.S. spy agencies were not ready to “make the call on attribution” for what was happening in 2016.

And, more importantly, in the fall, when the public IC attribution came only after McConnell refused to join a more aggressive statement because the intelligence did not yet support it (WaPo makes no mention of it, but DHS’s public reporting from late September still attributed the the threat to election infrastructure to “cybercriminals and criminal hackers”).

Senate Majority Leader Mitch McConnell (R-Ky.) went further, officials said, voicing skepticism that the underlying intelligence truly supported the White House’s claims. Through a spokeswoman, McConnell declined to comment, citing the secrecy of that meeting.

Key Democrats were stunned by the GOP response and exasperated that the White House seemed willing to let Republican opposition block any pre-election move.

On Sept. 22, two California Democrats — Sen. Dianne Feinstein and Rep. Adam B. Schiff — did what they couldn’t get the White House to do. They issued a statement making clear that they had learned from intelligence briefings that Russia was directing a campaign to undermine the election, but they stopped short of saying to what end.

A week later, McConnell and other congressional leaders issued a cautious statement that encouraged state election officials to ensure their networks were “secure from attack.” The release made no mention of Russia and emphasized that the lawmakers “would oppose any effort by the federal government” to encroach on the states’ authorities.

When U.S. spy agencies reached unanimous agreement in late September that the interference was a Russian operation directed by Putin, Obama directed spy chiefs to prepare a public statement summarizing the intelligence in broad strokes.

I’m all in favor of beating up McConnell, but there is no reason to demand members of Congress precede the IC with formal attribution for something like this. So until October 7, McConnell had cover (if not justification) for refusing to back a stronger statement.

And while the report describes Brennan’s efforts to brief members of Congress (and the reported reluctance of Republicans to meet with him), it doesn’t answer what remains a critical and open question: whether Brennan’s briefing for Harry Reid was different — and more inflammatory — than his briefing for Republicans, and whether that was partly designed to get Reid to serve as a proxy attacker on Jim Comey and the FBI.

Brennan moved swiftly to schedule private briefings with congressional leaders. But getting appointments with certain Republicans proved difficult, officials said, and it was not until after Labor Day that Brennan had reached all members of the “Gang of Eight” — the majority and minority leaders of both houses and the chairmen and ranking Democrats on the Senate and House intelligence committees.

Nor does this account explain another thing: why Brennan serially briefed the Gang of Eight, when past experience is to brief them in groups, if not all together.

In short, while the WaPo provides new details on the parallel intelligence and political tracks, it reinforces its own narrative while remaining silent on some details that are critical to that narrative.

The compartments

The foregrounding of CIA in all this also raises questions about a new and important detail about (what I assume to be the subsequently publicly revealed, though this is not made clear) Task Force investigating this operation: it lives at CIA, not FBI.

Brennan convened a secret task force at CIA headquarters composed of several dozen analysts and officers from the CIA, the NSA and the FBI.

The unit functioned as a sealed compartment, its work hidden from the rest of the intelligence community. Those brought in signed new non-disclosure agreements to be granted access to intelligence from all three participating agencies.

They worked exclusively for two groups of “customers,” officials said. The first was Obama and fewer than 14 senior officials in government. The second was a team of operations specialists at the CIA, NSA and FBI who took direction from the task force on where to aim their subsequent efforts to collect more intelligence on Russia.

Much later in the story, WaPo reveals how, in the wake of Obama calling for a report, analysts started looking back at their collected intelligence and learning new details.

Obama’s decision to order a comprehensive report on Moscow’s interference from U.S. spy agencies had prompted analysts to go back through their agencies’ files, scouring for previously overlooked clues.

The effort led to a flurry of new, disturbing reports — many of them presented in the President’s Daily Brief — about Russia’s subversion of the 2016 race. The emerging picture enabled policymakers to begin seeing the Russian campaign in broader terms, as a comprehensive plot sweeping in its scope.

It’s worth asking: did the close hold of the original Task Force, a hold that appears to have been set by Brennan, contribute to the belated discovery of these details revealing a broader campaign?

The surveillance driven sanctions

I’m most interested in the description of how the Obama Admin chose whom to impose sanctions on, though it includes this bizarre claim.

But the package of measures approved by Obama, and the process by which they were selected and implemented, were more complex than initially understood.

The expulsions and compound seizures were originally devised as ways to retaliate against Moscow not for election interference but for an escalating campaign of harassment of American diplomats and intelligence operatives. U.S. officials often endured hostile treatment, but the episodes had become increasingly menacing and violent.

Several of the details WaPo presents as misunderstood (including that the sanctions were retaliation for treatment of diplomats) were either explicit in the sanction package or easily gleaned at the time.

One of those easily gleaned details is that the sanctions on GRU and FSB were mostly symbolic. WaPo uses the symbolic nature of the attack on those who perpetrated the attack as a way to air complaints that these sanctions were not as onerous as those in response to Ukraine.

“I don’t think any of us thought of sanctions as being a primary way of expressing our disapproval” for the election interference, said a senior administration official involved in the decision. “Going after their intelligence services was not about economic impact. It was symbolic.”

More than any other measure, that decision has become a source of regret to senior administration officials directly involved in the Russia debate. The outcome has left the impression that Obama saw Russia’s military meddling in Ukraine as more deserving of severe punishment than its subversion of a U.S. presidential race.

“What is the greater threat to our system of government?” said a former high-ranking administration official, noting that Obama and his advisers knew from projections formulated by the Treasury Department that the impact of the election-related economic sanctions would be “minimal.”

Three things that might play into the mostly symbolic targeting of FSB, especially, are not mentioned. First, WaPo makes no mention of the suspected intelligence sources who’ve been killed since the election, most credibly Oleg Erovinkin, as well as a slew of other suspect and less obviously connected deaths. It doesn’t mention the four men Russia charged with treason in early December. And it doesn’t mention DOJ’s indictment of the Yahoo hackers, including one of the FSB officers, Dmitry Dokuchaev, that Russia charged with treason (not to mention the inclusion within the indictment of intercepts between FSB officers). There’s a lot more spy vs. spy activity going on here that likely relates far more to retaliation or limits on US ability to retaliate, all of which may be more important in the medium term than financial sanctions.

Given the Yahoo and other indictments working through San Francisco (including that of Yevgeniey Nikulin, who claims FBI offered him a plea deal involving admitting he hacked the DNC), I’m particularly interested in the shift in sanctions from NY to San Francisco, where Nikulin and Dokuchaev’s victims are located.

The FBI was also responsible for generating the list of Russian operatives working under diplomatic cover to expel, drawn from a roster the bureau maintains of suspected Russian intelligence agents in the United States.

[snip]

The roster of expelled spies included several operatives who were suspected of playing a role in Russia’s election interference from within the United States, officials said. They declined to elaborate.

More broadly, the list of 35 names focused heavily on Russians known to have technical skills. Their names and bios were laid out on a dossier delivered to senior White House officials and Cabinet secretaries, although the list was modified at the last minute to reduce the number of expulsions from Russia’s U.N. mission in New York and add more names from its facilities in Washington and San Francisco.

And the WaPo’s reports confirm what was also obvious: the two compounds got shut down (and were a priority) because of all the spying they were doing.

The FBI had long lobbied to close two Russian compounds in the United States — one in Maryland and another in New York — on the grounds that both were used for espionage and placed an enormous surveillance burden on the bureau.

[snip]

Rice pointed to the FBI’s McCabe and said: “You guys have been begging to do this for years. Now is your chance.”

The administration gave Russia 24 hours to evacuate the sites, and FBI agents watched as fleets of trucks loaded with cargo passed through the compounds’ gates.

Finally, given Congress’ bipartisan fearmongering about Kaspersky Lab, I’m most interested that at one point Treasury wanted to include them in sanctions.

Treasury Department officials devised plans that would hit entire sectors of Russia’s economy. One preliminary suggestion called for targeting technology companies including Kaspersky Lab, the Moscow-based cybersecurity firm. But skeptics worried that the harm could spill into Europe and pointed out that U.S. companies used Kaspersky systems and software.

In spite of all the fearmongering, no one has presented proof that Kaspersky is working for Russia (there are even things, which I won’t go in to for the moment, that suggest the opposite). But we’re moving close to de facto sanctions against Kaspersky anyway, even in spite of the fact (or perhaps because) they’re providing better intelligence on WannaCry than half the witnesses called as witnesses to Congress. But discrediting Kaspersky undercuts one of the only security firms in the world who, in addition to commenting on Russian hacking, will unpack America’s own hacking. You sanction Kaspersky, and you expand the asymmetry with which security firms selectively scrutinize just Russian hacking, rather than all nation-state hacking.

The looming cyberattack and the silence about Shadow Brokers

Which brings me to the last section of the article, where, over 8000 words in, the WaPo issues a threat against Russia in the form of a looming cyberattack Obama approved before he left.

WaPo’s early description of this suggests the attack was and is still in planning stages and relies on Donald Trump to execute.

Obama also approved a previously undisclosed covert measure that authorized planting cyber weapons in Russia’s infrastructure, the digital equivalent of bombs that could be detonated if the United States found itself in an escalating exchange with Moscow. The project, which Obama approved in a covert-action finding, was still in its planning stages when Obama left office. It would be up to President Trump to decide whether to use the capability.

But if readers make it all the way through the very long article, they’ll learn that’s not the case. The finding has already been signed, the implants are already being placed (implants which would most likely be discovered by Kaspersky), and for Trump to stop it, he would have to countermand Obama’s finding.

The implants were developed by the NSA and designed so that they could be triggered remotely as part of retaliatory cyber-strike in the face of Russian aggression, whether an attack on a power grid or interference in a future presidential race.

Officials familiar with the measures said that there was concern among some in the administration that the damage caused by the implants could be difficult to contain.

As a result, the administration requested a legal review, which concluded that the devices could be controlled well enough that their deployment would be considered “proportional” in varying scenarios of Russian provocation, a requirement under international law.

The operation was described as long-term, taking months to position the implants and requiring maintenance thereafter. Under the rules of covert action, Obama’s signature was all that was necessary to set the operation in motion.

U.S. intelligence agencies do not need further approval from Trump, and officials said that he would have to issue a countermanding order to stop it. The officials said that they have seen no indication that Trump has done so.

Whatever else this article is designed to do, I think, it is designed to be a threat to Putin, from long gone Obama officials.

Given the discussion of a looming cyberattack on Russia, it’s all the more remarkable WaPo breathed not one word about Shadow Brokers, which is most likely to be a drawn out cyberattack by Russian affiliates on NSA. Even ignoring the Shadow Brokers’ derived global ransomware attack in WannaCry, Shadow Brokers has ratcheted up the severity of its releases, including doxing NSA’s spies and hacks of the global finance system, It has very explicitly fostered tensions between the NSA and private sector partners (as well as the reputational costs on those private sector partners). And it has threatened to leak still worse, including NSA exploits against current Microsoft products and details of NSA’s spying on hostile nuclear programs.

The WaPo is talking about a big cyberattack, but an entity that most likely has close ties to Russia has been conducting one, all in plain sight. I suggested back in December that Shadow Brokers was essentially holding NSA hostage in part as a way to constrain US intelligence retaliation against Russia. Given ensuing events, I’m more convinced that is, at least partly, true.

But in this grand narrative of CIA’s early warning and Obama’s inadequate response, details like that remain unsaid.

Marcy Wheeler is an independent journalist writing about national security and civil liberties. She writes as emptywheel at her eponymous blog, publishes at outlets including Vice, Motherboard, the Nation, the Atlantic, Al Jazeera, and appears frequently on television and radio. She is the author of Anatomy of Deceit, a primer on the CIA leak investigation, and liveblogged the Scooter Libby trial.

Marcy has a PhD from the University of Michigan, where she researched the “feuilleton,” a short conversational newspaper form that has proven important in times of heightened censorship. Before and after her time in academics, Marcy provided documentation consulting for corporations in the auto, tech, and energy industries. She lives with her spouse in Grand Rapids, MI.

The Outdated XP Testimony on WannaCry to Congress

The Oversight Committee had a hearing on WannaCry last week. I won’t have time to watch the hearing for a few days, but I did read the testimony with some alarm. That’s because two of the four witnesses appear to have misstated one detail about the attack.

First, Symantec CTO Hugh Thompson suggested that the spread of the ransomware was due to Microsoft not releasing a patch for XP when it had released EternalBlue patches for other systems in March.

WannaCry spread to unpatched computers. Microsoft released a patch for the SMB vulnerability for Windows 7 and newer operating systems in March, but unpatched systems and systems running XP or older operating systems were unprotected. After the WannaCry outbreak began, Microsoft released a patch for XP and earlier platforms. Four days after the initial outbreak these patches were widely applied and new infections slowed to a trickle.

The implication here is that the ransomware primarily affected XP, and only because there hadn’t been a patch available.

Retired General Touhill suggested this outdated system was actually Windows 95 — and claimed that Microsoft had released that patch in March, along with the supported system patches.

Systems using unpatched versions of the Windows 95 operating system have been highlighted as exemplar victims of the Wannacry attack. Microsoft who, after a long and very public notification process, discontinued support to the Windows 95 operating system in 2014, about 19 years after its initial release. However, in light of the warnings and their own research, in March of this year Microsoft issued a rare emergency patch to Windows 95, nearly three years after they had discontinued support of the software. Despite these extraordinary actions, many organizations still did not heed the warnings and properly patch and configure their systems. As a result, they fell victim to Wannacry.

In fact, XP (to say nothing of Windows 95) was not the problem. Windows 7 was. Kaspersky Lab (which Congress has spent time of late demonizing as potential Russian spies) first pointed this out on May 19.

Chief among the revelations: more than 97 percent of infections hit computers running Windows 7, according to attacks seen by antivirus provider Kaspersky Lab. By contrast, infected Windows XP machines were practically non-existent, and those XP PCs that were compromised were likely manually infected by their owners for testing purposes. That’s according to Costin Raiu, director of Kaspersky Lab’s Global Research and Analysis Team, who spoke to Ars.

While the estimates are based only on computers that run Kaspersky software, as opposed to all computers on the Internet, there’s little question Windows 7 was overwhelmingly affected by WCry, which is also known as “WannaCry” and “WannaCrypt.” Security ratings firm BitSight found that 67 percent of infections hit Windows 7, Reuters reported.

The figures challenge the widely repeated perception that the outbreak was largely the result of end users who continued to deploy Windows XP, a Windows version Microsoft decommissioned three years ago. In fact, researchers now say, XP was largely untouched by last week’s worm because PCs crashed before WCry could take hold. Instead, it now appears, the leading contributor to the virally spreading infection were Windows 7 machines that hadn’t installed a critical security patch Microsoft issued in March

Days later Sophos confirmed that analysis.

Though the lack of patching and exposure of port 445 were easily identified problems, the reasons why Windows 7 was an easier target than XP remain somewhat clouded.

During testing, SophosLabs found that XP wasn’t the effective conduit for infection via the EternalBlue SMB exploit that many thought it was, while Windows 7 was easily infected. The research showed that WannaCry ransomware can affect XP computers – but not via the SMB worm mechanism, which was the major propagation vector for WannaCry.

[snip]

Various security companies arrived at a similar conclusion, putting the infection rate among Windows 7 computers at between 65% and 95%. SophosLabs puts that number even higher: our analysis of endpoint data for the three days that followed the outbreak shows that Windows 7 accounted for nearly 98% of infected computers.

It’s still a question of whether a victim patched their computer or not, but Microsoft did make a patch available for Windows 7 along with other supported systems. Though, as Sophos notes, unless users were paying extra for support, they might not have noticed the patch was there.

Microsoft had addressed the issue in its MS17-010 bulletin in March, but companies using older, no-longer-supported versions of the operating system wouldn’t have seen it unless they were signed up for custom support, ie Microsoft’s special extended – and paid-for – support.

That suggests one problem with the patching wasn’t the timeliness, but the secrecy. But, Congress might not learn that detail given the testimony they got last week.

Three days after the attack started, Homeland Security Czar Tom Bossert was still claiming WannaCry was spread via phishing. Now Congress is getting other debunked reporting.

We might respond better to these threats if the government was getting information that was at least as accurate as that information available to lowly hippie bloggers.

Marcy Wheeler is an independent journalist writing about national security and civil liberties. She writes as emptywheel at her eponymous blog, publishes at outlets including Vice, Motherboard, the Nation, the Atlantic, Al Jazeera, and appears frequently on television and radio. She is the author of Anatomy of Deceit, a primer on the CIA leak investigation, and liveblogged the Scooter Libby trial.

Marcy has a PhD from the University of Michigan, where she researched the “feuilleton,” a short conversational newspaper form that has proven important in times of heightened censorship. Before and after her time in academics, Marcy provided documentation consulting for corporations in the auto, tech, and energy industries. She lives with her spouse in Grand Rapids, MI.