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U.S. WARNS CHINA COULD HACK INFRASTRUCTURE, INCLUDING PIPELINES, RAIL SYSTEMS

By Raphael Satter, Zeba Siddiqui and James Pearson
May 26, 202311:05 AM GMT+2Updated a year ago
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May 25 (Reuters) - The U.S. State Department warned on Thursday that China was
capable of launching cyber attacks against critical infrastructure, including
oil and gas pipelines and rail systems, after researchers discovered a Chinese
hacking group had been spying on such networks.
A multi-nation alert issued Wednesday revealed the Chinese cyber-espionage
campaign had been aimed at military and government targets in the United States.
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The Chinese government has rejected assertions that its spies are going after
Western targets, calling the warning issued by the United States and its allies
a "collective disinformation campaign."
U.S. officials said they were still in the process of getting their arms around
the threat.
"We’ve had at least one location that we didn’t know about since the hunt guide
was released come forward with data and information," Rob Joyce, the U.S.
National Security Agency's (NSA) cybersecurity director, told Reuters. The
agency disclosed technical details earlier to help critical service providers
detect the spying.
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The U.S. Cybersecurity and Infrastructure Security Agency (CISA) separately said
it was working to understand "the breadth of potential intrusions and associated
impacts."
That would help it "provide assistance where needed, and more effectively
understand the tactics undertaken by this adversary," CISA's executive assistant
director, Eric Goldstein, told Reuters.
Part of the challenge in defending against this espionage work is that it's more
covert than regular spy operations, according to researchers and officials.

"In these cases the adversary is often using legitimate credentials and
legitimate network administration tools to gain access to execute their
objectives on a target network," Goldstein said. "Many traditional methods of
detection, such as antivirus, will not find these intrusions."
Item 1 of 2 U.S. and Chinese flags are seen in this illustration taken, January
30, 2023. REUTERS/Dado Ruvic/Illustration/File Photo
[1/2]U.S. and Chinese flags are seen in this illustration taken, January 30,
2023. REUTERS/Dado Ruvic/Illustration/File Photo Purchase Licensing Rights,
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Microsoft analysts who identified the campaign, which they dubbed Volt Typhoon,
said it "could disrupt critical communications infrastructure between the United
States and Asia region during future crises" - a nod to escalating U.S.-China
tensions over Taiwan and other issues.

"The U.S. intelligence community assesses that China almost certainly is capable
of launching cyberattacks that could disrupt critical infrastructure services
within the United States, including against oil and gas pipelines and rail
systems," State Department spokesperson Matthew Miller said in a press briefing.
"It's vital for government and network defenders in the public to stay
vigilant."
U.S. agencies have been pushing for improved cybersecurity practices in its
majority-privately held critical infrastructure industry, after the 2021 hack of
the key Colonial Pipeline disrupted nearly half of the U.S. East Coast’s fuel
supply.
Intelligence agencies in the United States, Britain and their close allies
issued an alert Wednesday to warn about Volt Typhoon. Microsoft said the group
had targeted critical infrastructure organizations in the U.S. Pacific territory
of Guam, and it was using the security firm Fortinet's (FTNT.O), opens new tab
FortiGuard devices to break into target's networks.
Researcher Marc Burnard, whose organisation Secureworks has dealt with several
intrusions tied to Volt Typhoon, said Secureworks had seen no evidence of
destructive activity by Volt Typhoon, but that its hackers were focused on
stealing information that would "shed light on U.S. military activities."
NSA's Joyce said there was no doubt Volt Typhoon was putting itself in position
to carry out disruptive attacks.
"It’s clear that some of the entities on here are of no intelligence value," he
told Reuters of the critical infrastructure sites identified by the government.
Chinese foreign ministry spokesperson Mao Ning told reporters that the alerts
issued by the United States, Britain, Canada, Australia and New Zealand were
intended to promote their intelligence alliance - known as the Five Eyes - and
it was Washington that was guilty of hacking.
"The United States is the empire of hacking," Mao said.

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Additional reporting by Christopher Bing and Daphne Psaledakis; editing by
William Maclean, Mark Heinrich, Chizu Nomiyama and Leslie Adler

Our Standards: The Thomson Reuters Trust Principles., opens new tab

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Raphael Satter

Thomson Reuters

Reporter covering cybersecurity, surveillance, and disinformation for Reuters.
Work has included investigations into state-sponsored espionage, deepfake-driven
propaganda, and mercenary hacking.

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James Pearson

Thomson Reuters

Reports on hacks, leaks and digital espionage in Europe. Ten years at Reuters
with previous postings in Hanoi as Bureau Chief and Seoul as Korea
Correspondent. Author of 'North Korea Confidential', a book about daily life in
North Korea.

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