Friday, August 17, 2018

Indictment Reveals GRU Role in Election Meddling: Two Russian Military Spy Units Conducted Hack, Covertly Disseminated Hacked Documents

Veteran national security reporter Bill Gertz offers a piece at the Washington Free Beacon on the Russian GRU unit involved in the 2016 American election operation.

A team of Russian GRU military intelligence officers specializing in covert influence operations played the key role in the 2016 election meddling operation while working out of an office building on 22 Kirova Street in Moscow called "The Tower" by GRU spies.

Beginning in April 2016, the GRU team known as Unit 74455 and headed by Col. Aleksandr V. Osadchuk was the key player in the major Russian influence operation aimed at swaying the 2016 presidential election through covertly disseminating hacked documents on the internet.

"Unit 74455 assisted in the release of stolen documents through the DCLeaks and Guccifer 2.0 personas, the promotion of those releases, and the publication of anti-Clinton content on social media accounts operated by the GRU," the federal grand jury indictment filed July 13 in Washington says.

You can read the rest of the piece via the below link:

Don’t Be Misled By False Medicare Or Social Security Ads

Jim Borland, the Social Security Administration’s acting deputy commissioner for communications offers the below information:

Online and otherwise, there’s a lot of information out there, and sometimes it’s difficult to tell what sources are credible. With millions of people relying on Social Security, scammers target audiences who are looking for program and benefit information.

The law that addresses misleading Social Security and Medicare advertising prohibits people or non-government businesses from using words or emblems that mislead others. Their advertising can’t lead people to believe that they represent, are somehow affiliated with, or endorsed or approved by Social Security or the Centers for Medicare & Medicaid Services (Medicare).

People are often misled by advertisers who use the terms “Social Security” or “Medicare.” Often, these companies offer Social Security services for a fee, even though the same services are available directly from Social Security free of charge. These services include getting:

A corrected Social Security card showing a person’s married name;

§  A Social Security card to replace a lost card; 

§  A Social Security Statement; and§   

§  A Social Security number for a child.

If you receive misleading information about Social Security, send the complete ad, including the envelope, to:
Office of the Inspector General Fraud Hotline
Social Security Administration
P.O. Box 17768
Baltimore, MD 21235

You can learn more about how we combat fraudulent advertisers by reading our publication What You Need to Know About Misleading Advertising

Thursday, August 16, 2018

FBI: Prescription For Prison Time - Fraudsters Scammed Government, Private Insurance Companies Out Of $100 Million

The FBI released the below information:

A group of Florida scammers who set up pharmacies to bilk the government and insurance companies ended up writing themselves a prescription for prison time.

The eight men owned and/or operated several pharmacies and related businesses—known by names such as A to Z Pharmacy and Havana Pharmacy—whose sole purpose was to help these criminals line their own pockets. Initially, the men bribed medical providers to write unnecessary prescriptions for compounded drugs like pain or scar creams, then billed the patients’ insurance companies large sums for the drugs. And in the making of the prescriptions, they often used unusual ingredients, such as horse tranquilizers, that were not medically necessary for the particular patients.

A compounding pharmacy creates tailored drugs for individual patients who cannot be treated with traditional drugs due to allergies or other special needs. The Food and Drug Administration does not approve compounded drugs. While investigators found no evidence that any of the patients who received compounded drugs in this case suffered any dangerous side effects from them, the FDA warns that unnecessary use of compounded drugs can pose risks for patients.

As the scam evolved, the conspirators bought lists of information on patients with generous private insurance, Medicare, or TRICARE. They then sent their creams and other drugs to those patients with or without the patients’ knowledge or consent and without consulting their physicians.

“The main thing is there was never any patient necessity here,” said Special Agent Kurt McKenzie, who worked the case out of the FBI’s Miami Division. “The patients never asked for it; they didn’t need it. In many cases, the patients would send the creams back and say ‘I never asked for this.’”

The scheme went on for about four years, with the participants using various tactics to avoid detection, including purchasing additional pharmacies to use once an insurance company stopped paying for prescriptions at ones they were already using. The profits were significant—more than $100 million. Nicholas Borgesano, Jr., one of the ringleaders, made an estimated $80 million of that himself. Yet thanks to the investigative work of the FBI, the Department of Health and Human Services’ Office of Inspector General, and the Defense Criminal Investigative Service, the fraudsters were discovered and brought to justice. Traditional investigative techniques like following a complex money trail helped bring down the fraud ring.

All eight men involved in the scheme pleaded guilty to conspiracy to commit health care fraud. In April, Borgesano was sentenced to 15 years in prison. His seven co-conspirators have been sentenced to between one and six years.

“Every paycheck you earn, there is money coming out to fund Medicare and your own health insurance, and the American people are losing cents on the dollar to these fraudsters,” McKenzie said. “They are just reaching out and taking it, so it’s important for the FBI and our partners to target and stop this activity.”  

Borgesano used his millions to buy 16 properties and numerous boats and high-end vehicles that were forfeited as part of his plea. The victims—the insurance plan sponsors and the government—will be able to recoup a small amount of their losses through the asset forfeiture process.

“We can’t let the bad guys keep their ill-gotten gains,” said Special Agent Rolf Gjertsen of the FBI’s Tampa Division, who also worked the case. “It’s probably a drop in the bucket compared to what they lost, but it’s important for the public to know we use the asset forfeiture process to try to make victims whole to the extent we can.”

Special Agent Jennifer McGrath, who also worked on the investigative team out of the Miami Division, said the crime was certainly not a victimless one, in particular for military families.

“TRICARE is the primary insurer for military families,” McGrath explained. “They stole $100 million from TRICARE and other insurers and used it to buy boats and fancy cars. It’s taking that money away from military families and others who use the victim insurance providers.”

McGrath said anyone who suspects insurance fraud—such as unexpectedly receiving medications or equipment not prescribed by your doctor or not being charged a normally required co-payment—should report it to their insurance provider’s fraud prevention department. 

Tuesday, August 14, 2018

Pentagon Is Rethinking Its Relationship With US Defense Contractors Adding Security To Combat Espionage And Sabotage In The Supply Chain

Stars and Stripes offers a piece on the Defense Department's new security strategy to combat espionage and sabotage in the military procurement system. 
WASHINGTON — The Pentagon has a new goal aimed at protecting its $100 billion supply chain from foreign theft and sabotage: To base its weapons contract awards on security assessments — not just cost and performance — a move that would mark a fundamental shift in department culture.

The goal, based on a strategy called Deliver Uncompromised, comes as American defense firms are increasingly vulnerable to data breaches, a risk highlighted earlier this year by China's alleged theft of sensitive information related to undersea warfare, and the Pentagon's decision last year to ban software made by the Russian firm Kaspersky Lab.
"The department is examining ways to designate security as a metric within the acquisition process," Maj. Audricia Harris, a Pentagon spokeswoman, said in a statement. "Determinations [currently] are based on cost, schedule, and performance. The department's goal is to elevate security to be on par with cost, schedule, and performance."

You can read the rest of the piece via the below link:

The Kissing Sailor On V-J Day: On This Day In History The Japanese Surrendered

As notes, on this day in history the Japanese surrendered and World War II ended.

You can read about the surrender via the below link:

In the above iconic Alfred Eisenstaedt photo, a sailor kissed a nurse in Times Square when the surrender was announced.

Monday, August 13, 2018

The Art Of War By Sun Tzu: A New Translated By Peter Harris

Gary Anderson, a retired Marine colonel, offers a review in the Washington Times of a new translation of Sun Tzu’s The Art of War.

Military theory comes in two forms. The first is an attempt to understand the nature of war and its relation to politics. Clausewitz and Machiavelli represent the best of this school.

The second and more prevalent form falls into the “how to do it” category. Most such works in this type of venue are written by former successful practitioners of the art and science of war. Most military professionals would agree that Sun Tzu’s “The Art of War” remains at the top of the former list. Peter Harris has given us a new translation, and perhaps a new twist, on this timeless classic.

Chinese in either its Mandarin or Cantonese versions, is a notoriously hard language to translate into English. As in Arabic, some characters have multiple meaning depending on the context in which they are used. Most former military officers of the Vietnam era were raised on Marine Brig. Gen. Samuel Griffith’s 1963 translation. 

Griffith’s translation became popular during the Vietnam War because North Vietnam’s brilliant Gen. Giap was known to be a Sun Tzu student, as was Chairman Mao, who was then considered to be the primary sponsor of the North’s cause.

Before 1963, Western interest in Sun Tzu was spotty at best. It is highly unlikely that Erwin Rommel or George Washington had ever read Sun Tzu, but both made excellent use of deception, feigned retreats, reconnaissance and surprise to win their most notable victories in ways recommended in “The Art of War.” 

Critics of Sun Tzu have complained that he depends too much on the non-military aspects of war fighting rather than the mere act of trying to kill more of the enemy than he kills of you.

Washington used campfires to cloak his disengagement from a superior enemy in several situations. Rommel won many battles by withdrawing his smaller tank force through a line of the superb 88-millimeter anti-tank guns allowing those weapons to break the momentum of the pursuing British allowing his tanks to counterattack on more favorable terms. Sun Tzu would have approved in both cases.

Mr. Harris tends more than Griffith to emphasize the non-military aspects of national power — economic, information, diplomatic means.

You can read the rest of the review via the below link:

Sunday, August 12, 2018

On This Day In History Thriller Writer Ian Fleming, Creator Of James Bond, Died

On August 12th in 1964, I was a 12-year-old sitting in the back seat of my father's car when I heard on the car radio that Ian Fleming had died. I was thunderstruck.

In the months prior to that sad announcement I had been reading through Ian Fleming's James Bond thrillers. Having loved the first two Bond films, Dr. No and From Russia With Love, starring Sean Connery as James Bond, I began reading the novels. I was pleased to discover that the books were darker and more complicated than the films and I've been an Ian Fleming aficionado ever since. 

Below is Ian Fleming's obituary, which appeared in the Philadelphia Inquirer

You can read my Crime Beat columns on the late, great thriller writer via the below links: 

You can also read my Counterterrorism magazine about Ian Fleming's WWII experience and his creation of the intelligence commando group, 30 Assault Unit, via the below link:

And you can learn more about Ian Fleming and his fascinating life as a naval intelligence officer, journalist and author by reading the below biographies of the late writer:

Taking The Path Through Japan Once Trodden By Ian Fleming And James Bond

"You only live twice. Once when you are born, and once when you look death in the face," Ian Fleming wrote in his 1963 James Bond thriller, You Only Live Twice.

As a young sailor stationed on an aircraft carrier off the coast of Vietnam in 1971, I reread Ian Fleming’s You Only Live Twice, which takes place in Japan, as well as Fleming’s London Sunday Times piece on Japan in his book Thrilling Cities, in anticipation of our upcoming R&R visit to Sasebo, Japan.

As an Ian Fleming aficionado, I was thrilled to see some of the sights Ian Fleming saw during his visit to Japan a decade earlier.  

Damian Flanagan at the Japan Times follows in the footsteps of Ian Fleming, as the late, great thriller writer traveled through Japan in 1962 while researching his Bond novel, You Only Live Twice.

Tasked to trace the route across Japan that Ian Fleming, the author of James Bond, took in 1962 — and which Bond himself largely follows in Fleming’s penultimate 007 novel “You Only Live Twice” (1964) — it was suggested I could experience the same route but with modern sensibilities.

In truth, if you wish to follow the two-week trip Fleming took across Japan — beginning in Tokyo and winding your way down to Kyushu — you can assuredly do so, either in one go or knocked off in discrete sections. You can visit nearly all of the places that Fleming went to and see the eternal sights that he did: the Mikimoto pearl fisheries and the Grand Shrines of Ise on the Kii Peninsula; the Nijo Jinya and Shimabara brothel district in Kyoto; and take a ferry ride from the city of Kobe along the islands of the Seto Inland Sea to the “hells” of Beppu, to finally arrive at the magnificent caldera of Mount Aso in Kyushu before taking in Fukuoka on a bullet train back to Tokyo.

You can do all of that and take the Bond novel with you — filling your head with Secret Service adventures and 1960s style — and, as a Bond aficionado, I would heartily encourage you to do so. But to what extent can you experience Japan today in the same raw, intense manner that Fleming did back in 1962?
… As in the Bond novels, death and sex were the two main features of Fleming’s Kyoto tour. Besides the singing floors, he took a keen interest in the workings of the Shimabara brothel district and how it catered to visiting dignitaries in the Edo Period (1603-1868).
On his trip, Fleming had two travel companions: Richard Hughes (an internationally renowned journalist, Japan expert and spy) and Torao “Tiger” Saito (an architect, editor and the model for “Tiger Tanaka,” the head of the Japanese Secret Service, in “You Only Live Twice”), who had carefully prepared the itinerary for him.

Hughes referred to the experience as “the most instructive, enjoyable, crowded, leisurely, lively and hilarious trip I ever made in thirteen long and happy years of residence in Japan.” “Sayonara to James Bond,” a chapter in his memoirs, has the air of a travel classic, a kind of “Three Men in Japan” of amiable hijinks and mutual warmth.

You can read the rest of the piece via the below link: 
Note: The top photo shows Sean Connery as James Bond in the film You Only Live Twice. The above photo show Ian Fleming and Richard Hughes in Japan. 

Friday, August 10, 2018

FBI: Prolific Fraudster Sentenced To 40 Years - Fugitive Faces Justice After Extradition from Mexico

The FBI released the below piece.

He was, in the words of the assistant U.S. attorney prosecuting him, a “financial predator.” And the federal judge he recently stood before called his long-term fraud crime spree “outrageous” and “despicable,” noting the more than 500 victims ensnared by his latest scheme.

The individual in question is Harris Dempsey “Butch” Ballow, a Texas man who had seemingly made a career out of separating people from their hard-earned money through various financial scams—starting back in the 1980s. But that career has finally come to end: The 75-year-old Ballow was sentenced in May to 40 years in prison after pleading guilty to defrauding investors in a Nevada company. He was also ordered to pay more than $37 million in restitution to those investors.

And according to FBI Houston Special Agent Kendall Hopper, who worked the case, what made this particular criminal scheme even worse was that Ballow had perpetrated it while he was a fugitive from justice hiding out in Mexico. “Ballow fled the United States in late 2004, right around the time he was scheduled to appear in court for sentencing on a previous federal conviction for fraud-related money laundering,” said Hopper, “but instead of keeping a low profile, he brazenly continued his criminal ways.”

In this most recent scheme that netted him the 40-year prison term, Ballow and co-conspirators were able to buy up the majority of the publicly traded shares of a Nevada company called E-SOL International Corporation and install fictitious people as company officers. At the time, E-SOL had almost no assets and conducted no business. Ballow then rebranded E-SOL as a holding company for a couple of phony businesses—of course controlled by him and his associates—and got to work soliciting investors.

“Ballow used lies and deception to sell stock in his companies to unsuspecting investors, including many Canadians,” said Hopper. “He hid his true identity, his past criminal convictions, and his fugitive status. He also published false and misleading information about the companies in order to tempt investors and increase stock prices.”

One of the particular scams involved Ballow—through his phony companies—selling land and ownership interests in a number of proposed resort developments in Mexico. Potential investors were even taken on tours of the properties. Of course, explained Hopper, there were never any actual resorts built.

During his five-plus years in Mexico, Ballow and his criminal associates opened various bank accounts in Mexico and several other countries and transferred millions of dollars in investment money from his clients into these bank accounts—and ultimately into their own pockets.

But the gravy train ended in July 2010, when Ballow was detained by Mexican authorities on an arrest warrant issued by the Southern District of Texas related to his previous money laundering conviction. He was extradited back to the U.S. in April 2011, and not long after that, he was sentenced to 10 years on the money laundering charge.

Also in July 2010, the same month Ballow had been apprehended in Mexico, he was indicted again—this time related to the E-SOL stock fraud scheme. A few months later, his co-conspirators were indicted and additional charges were lodged against Ballow.

This complex case, which started in the FBI’s San Antonio Field Office but was eventually moved to the Houston Division, was worked closely with the Internal Revenue Service’s Criminal Investigation (CI) Division—in particular, IRS-CI Agent Aaron Gogley, who was detailed to an FBI Houston task force.

“Aaron was a vital part of the investigation,” explained Hopper. “An important aspect of these kinds of cases involves following the money trail left by the criminals—and Aaron’s expertise in doing just that made a big difference in the outcome of the case.”

Gogley said that investigators in the case were motivated by a desire to stop a career criminal who had financially hurt a large number of victims from taking advantage of one more person. “Most of Ballow’s victims were not wealthy people,” the IRS-CI agent explained. “They were just regular folks planning for their financial futures—families with kids, workers nearing retirement, retirees. Some even took out loans to fund their investments, and the loss of this money had a severe impact on them.”

In addition to the IRS, the Bureau received invaluable assistance from authorities in Canada and Mexico, along with the U.S. Marshals Service and Postal Inspection Service. This case was yet another example of the importance of multi-agency collaboration—even across national borders—in solving crimes and protecting the public.

Tuesday, August 7, 2018

My Washington Times Piece On Why Police Body-Worn Cameras Protect Both Officers And The Public

The Washington Times ran my piece on police body-worn cameras.

Cop haters were no doubt disappointed when a police video showed clearly that the man shot and killed by police officers last month in Chicago was reaching for a gun.

Protesters in Chicago organized swiftly after the fatal shooting, and hit the street and demonstrated against evil cops shooting unharmed black men. Rocks and bottles were thrown, and the police stepped in to quell the violence.

The Chicago police superintendent released the police body-worn camera video in response to cries that the man, Harith Augustus, was unarmed. The police footage shows that he had a semi-automatic handgun in a holster on his hip and that he turned toward the pursuing officers with his hand on his waist. He was shot multiple times by the officers.

The released police footage pauses and zooms in on the handgun, which a police spokesperson said documents that the gun was seen clearly by the officers on the scene. Initial reports indicate that Harith Augustus did not have a permit to carry a concealed handgun.

This past May in Texas a woman accused a Texas state trooper of sexually assaulting her after the trooper pulled her over. The woman, Sherita Dixon-Cole, failed a field sobriety test and she later claimed the trooper told her she could avoid arrest by granting him sexual favors. She said she refused and then the trooper forced several sexual acts upon her. Her complaint was quite detailed and graphic.

But then the Texas Department released the video from the trooper’s body-worn camera, which conflicts drastically with her false and vivid account. The footage shows the trooper being totally professional with the inebriated woman. 

You can read the rest of the piece via the below link:

Monday, August 6, 2018

The Navy Is Moving Its Aircraft Carriers To Ready Them For A Potential Fight With China and Russia — Here's Where They're Headed

Christopher Woody at the Business Insider offers a piece on the U.S. Navy's new movement of aircraft carriers.

You can read the rest of the piece and view photos of the carrier force via the below link:

Saturday, August 4, 2018

Bancroft: Despite his thorny place in culture, Raymond Chandler remains a great love

Colette Bancroft, the Tampa Bay Times book editor, offers a column on the late, great crime novelist Raymond Chandler’s continuing influence.

Some writers you enjoy, some writers you admire.

A handful of writers you love, and one of my handful is Raymond Chandler.

His seven novels, published between 1939 and 1958, were transformational for me when I first read them in the 1970s. They sparked my enduring fascination with crime fiction and led to my unfinished doctoral dissertation about his work that has long been tucked away in a desk drawer. 

My crush on Chandler endures: My dog is named Marlowe, after his great character, gallant, wisecracking Los Angeles private detective Philip Marlowe.

I’m just one of a legion of fans and followers. Chandler died in 1959, but his style and substance have deeply influenced countless writers in the mystery genre and beyond. The early generations of his successors included Ross Macdonald, John D. MacDonald and Robert B. Parker. How many contemporary crime fiction writers follow in his footsteps? Let’s name a few alphabetically: Megan Abbott, Ace Atkins, Benjamin Black, Lawrence Block, James Lee Burke, Michael Connelly, Robert Crais, James Ellroy ... you get the idea.

The 130th anniversary of Chandler’s birth came around on July 23, and it was marked by the publication of two books: The Annotated Big Sleep, a new edition of Chandler’s first novel, edited by Owen Hill, Pamela Jackson and Anthony Dean Rizzuto; and Only to Sleep: A Philip Marlowe Novel by Lawrence Osborne, the third author commissioned by the Chandler estate to write new novels about the private detective. (The others were Parker and Black.)

The anniversary was also noted in "The Big Seep: Reading Raymond Chandler in the Age of #MeToo," an essay published in Slate by bestselling author Megan Abbott, whose own new novel, Give Me Your Hand, gives one of Chandler’s recurring themes a radical twist.
You can read the rest of the column via the below link:

You can also read my Crime Beat column on Raymond Chandler via the below link:

Protecting Americans From Violent Offenders

Thomas T. Cullen, the U.S. Attorney for the U.S. District Court, Western District of Virginia, offers a piece in the Washington Times.

As we enter the 2018 midterm season and the attendant legislative interregnum, Congress can and should take bipartisan action to protect us from repeat violent offenders.

In 1984, President Reagan signed into law the Armed Career Criminal Act (ACCA). Under the ACCA, felons convicted of unlawfully possessing a firearm face a mandatory minimum sentence of 15 years if they had three or more prior convictions for a “serious drug offense” or a “violent felony.”

This federal statute, along with other criminal-justice initiatives, including parole abolition, bail reform, and the U.S. Sentencing Guidelines, were passed to address an alarming two-decade increase in violent crime.

As Attorney General Jeff Sessions recently noted, between 1964 and 1980, the number of robberies and rapes tripled, aggravated assaults nearly tripled, and murders doubled.

The ACCA and these other reforms were a resounding success. Between 1991 and 2014, the murder and aggravated-assault rates decreased by half. Robberies decreased by two-thirds and rapes by more than a third.

The U.S. Supreme Court in 2015 dealt a severe blow to the ACCA and violent-crime reduction efforts. In Johnson v. United States, the Court considered whether Samuel Johnson, an avowed white supremacist who had confessed to planning multiple acts of domestic terrorism, should be subject to the mandatory 15-year sentence under the ACCA after pleading guilty to the possession of an AK-47 rifle, several other firearms, and over 1,000 rounds of ammunition as a previously convicted felon.

You can read the rest of the piece via the below link:

Friday, August 3, 2018

Hemingway Story From 1956 Published For First Time

The Sioux City Journal offers a piece on the publication of a Ernest Hemingway short story that had not been published before.

NEW YORK (AP) — The themes and trappings are familiar for an Ernest Hemingway narrative: Paris, wartime, talk of books and wine and the scars of battle.

But the story itself has been little known beyond the scholarly community for decades: "A Room on the Garden Side," written in 1956, is being published for the first time. The brief, World War II-era fiction appears this week in the summer edition of The Strand Magazine, a literary quarterly which has released obscure works by Raymond Chandler, John Steinbeck and others.

"Hemingway's deep love for his favorite city as it is just emerging from Nazi occupation is on full display, as are the hallmarks of his prose," Strand Managing Editor Andrew F. Gulli wrote in an editorial note.

Kirk Curnutt, a board member of The Hemingway Society, contributed an afterword for the Strand, saying that "the story contains all the trademark elements readers love in Hemingway."

"Steeped in talk of Marcel Proust, Victor Hugo, and Alexandre Dumas, and featuring a long excerpt in French from Charles Baudelaire's 'Les Fleurs du Mal,' the story implicitly wonders whether the heritage of Parisian culture can recover from the dark taint of fascism," Curnutt wrote.

War was a longtime muse for Hemingway. He served as an ambulance driver during World War I, drawing upon his experiences for his classic novel "A Farewell to Arms." The Spanish Civil War inspired his novel "For Whom the Bell Tolls." He was both soldier and correspondent during World War II and was on hand in Paris in August 1944 for the liberation from Nazi occupation, described by the author in reports published soon after by Collier's magazine.

"A Room on the Garden Side" takes place in the Ritz hotel (Hemingway liked to say that he liberated the Ritz bar) and is narrated by a Hemingway stand-in called Robert who shares the author's own nickname — Papa. Robert and his entourage drink wine, quote from Baudelaire and debate "the dirty trade of war."

You can read the rest of the piece via the below link:

You can also read my Washington Times review of Hemingway’s short stories via the below link:

Thursday, August 2, 2018

Photos Of Returning American Korean War Dead

In the above photo the honor guard assigned to the U.S. Indo-Pacific Command (INDOPACOM) move a flag-draped case from a U.S. Air Force C-17 Globemaster III aircraft during an honorable carry ceremony at Joint Base Pearl Harbor-Hickam, Hawaii on Aug. 1, 2018. The United Nations Command recently repatriated 55 transfer cases from North Korea that contain what are believed to be the remains of American service members lost in the Korean War. The U.S. Air Force photo was taken by Senior Airman Apryl Hall.

In the above photo the Defense POW/MIA Accounting Agency (DPAA) and U.S. Indo-Pacific Command conduct an honorable carry ceremony at Joint Base Pearl Harbor-Hickam, Hawaii on Aug. 1, 2018. Carry teams will move fifty-five transfer cases, containing what are believed to be the remains of American service members lost in the Korean War, to the DPAA facility at Joint Base Pearl Harbor-Hickam for identification. North Korea recently turned over the remains to the U.S. and is the first mass turnover of remains since the early '90s. The U.S. Air Force photo was taken by Senior Airman Apryl Hall.

In the above photo an honor guard detail of U.S. Indo-Pacific Command (INDOPACOM) personnel conducts an honorable carry ceremony at Joint Base Pearl Harbor-Hickam, Hawaii, Aug. 1, 2018. Carry teams will move 55 flag-draped transfer cases, containing what are believed to be the remains of American service members lost in the Korean War to the DPAA laboratory at Joint Base Pearl Harbor-Hickam for identification. The U.S. Air Force photo was taken by Staff Sgt. Mikaley Kline.

In the above photo Korean War veterans pay respects after an honorable carry ceremony at Joint Base Pearl Harbor-Hickam, Hawaii on Aug. 1, 2018. The United Nations Command recently repatriated 55 transfer cases from North Korea to the U.S. that contain what are believed to be the remains of American service members lost in the Korean War. The U.S. Air Force photo was taken by Senior Airman Apryl Hall.

Note: You can click on the above photos to enlarge

Wednesday, August 1, 2018

Three Members of Notorious International Cybercrime Group “Fin7” In Custody For Role In Attacking Over 100 U.S. companies

The U.S. Justice Department released the below information:

Three high-ranking members of a sophisticated international cybercrime group operating out of Eastern Europe have been arrested and are currently in custody facing charges filed in U.S. District Court in Seattle, announced Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Annette L. Hayes for the Western District of Washington and Special Agent in Charge Jay S. Tabb Jr. of the FBI Seattle Field Office.

According to three federal indictments unsealed today, Ukrainian nationals Dmytro Fedorov, 44, Fedir Hladyr, 33, and Andrii Kopakov, 30, are members of a prolific hacking group widely known as FIN7 (also referred to as the Carbanak Group and the Navigator Group, among other names).  Since at least 2015, FIN7 members engaged in a highly sophisticated malware campaign targeting more than 100 U.S. companies, predominantly in the restaurant, gaming, and hospitality industries.  As set forth in indictments, FIN7 hacked into thousands of computer systems and stole millions of customer credit and debit card numbers, which the group used or sold for profit. 

In the United States alone, FIN7 successfully breached the computer networks of companies in 47 states and the District of Columbia, stealing more than 15 million customer card records from over 6,500 individual point-of-sale terminals at more than 3,600 separate business locations.  Additional intrusions occurred abroad, including in the United Kingdom, Australia, and France.  Companies that have publicly disclosed hacks attributable to FIN7 include such familiar chains as Chipotle Mexican Grill, Chili’s, Arby’s, Red Robin and Jason’s Deli.  Additionally in Western Washington, FIN7 targeted other local businesses. 

“The three Ukrainian nationals indicted today allegedly were part of a prolific hacking group that targeted American companies and citizens by stealing valuable consumer data, including personal credit card information, that they then sold on the Darknet,” said Assistant Attorney General Benczkowski.  “Because hackers are committed to finding new ways to harm the American public and our economy, the Department of Justice remains steadfast in its commitment to working with our law enforcement partners to identify, interdict, and prosecute those responsible for these threats.”

“Protecting consumers and companies who use the internet to conduct business – both large chains and small ‘mom and pop’ stores -- is a top priority for all of us in the Department of Justice,” said U.S. Attorney Hayes.  “Cyber criminals who believe that they can hide in faraway countries and operate from behind keyboards without getting caught are just plain wrong.  We will continue our longstanding work with partners around the world to ensure cyber criminals are identified and held to account for the harm that they do – both to our pocketbooks and our ability to rely on the cyber networks we use.”

“The naming of these FIN7 leaders marks a major step towards dismantling this sophisticated criminal enterprise,” said Special Agent in Charge Tabb.  “As the lead federal agency for cyber-attack investigations, the FBI will continue to work with its law enforcement partners worldwide to pursue the members of this devious group, and hold them accountable for stealing from American businesses and individuals.”

Each of the three FIN7 conspirators is charged with 26 felony counts alleging conspiracy, wire fraud, computer hacking, access device fraud, and aggravated identity theft. 

In January 2018, at the request of U.S. officials, foreign authorities separately arrested Ukrainian Fedir Hladyr and a second FIN7 member, Dmytro Fedorov.  Hladyr was arrested in Dresden, Germany, and is currently detained in Seattle pending trial.  Hladyr allegedly served as FIN7’s systems administrator who, among other things, maintained servers and communication channels used by the organization and held a managerial role by delegating tasks and by providing instruction to other members of the scheme.  Hladyr’s trial is currently scheduled for Oct. 22.

Fedorov, a high-level hacker and manager who allegedly supervised other hackers tasked with breaching the security of victims’ computer systems, was arrested in Bielsko-Biala, Poland.  Fedorov remains detained in Poland pending his extradition to the United States.

In late June 2018, foreign authorities arrested a third FIN7 member, Ukrainian Andrii Kolpakov in Lepe, Spain.  Kolpakov, also alleged to be a supervisor of a group of hackers, remains detained in Spain pending the United States’ request for extradition.

According to the indictments, FIN7, through its dozens of members, launched numerous waves of malicious cyberattacks on numerous businesses operating in the United States and abroad.  FIN7 carefully crafted email messages that would appear legitimate to a business’ employee, and accompanied emails with telephone calls intended to further legitimize the email. Once an attached file was opened and activated, FIN7 would use an adapted version of the notorious Carbanak malware in addition to an arsenal of other tools to ultimately access and steal payment card data for the business’ customers. Since 2015, FIN7 sold the data in online underground marketplaces. (Supplemental document “How FIN7 Attacked and Stole Data” explains the scheme in greater detail.)

FIN7 used a front company, Combi Security, purportedly headquartered in Russia and Israel, to provide a guise of legitimacy and to recruit hackers to join the criminal enterprise.  Combi Security’s website indicated that it provided a number of security services such as penetration testing.  Ironically, the sham company’s website listed multiple U.S. victims among its purported clients. 

The charges in the indictments are merely allegations, and the defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

The indictments are the result of an investigation conducted by the Seattle Cyber Task Force of the FBI and the U.S. Attorney’s Office for the Western District of Washington, with the assistance of the Justice Department’s Computer Crime and Intellectual Property Section and Office of International Affairs, the National Cyber-Forensics and Training Alliance, numerous computer security firms and financial institutions, FBI offices across the nation and globe, as well as numerous international agencies. Arrests overseas were executed in Poland by the “Shadow Hunters” from CBŚP (Polish Central Bureau of Investigation); in Germany by the LKA Sachsen - Dezernat 33, (German State Criminal Police Office) and the Polizeidirektion Dresden (Dresden Police); and in Spain the Grupo de Seguridad Logica within the Unidad de Investigación Technologica of the Cuerpo Nacional de Policía (Spanish National Police)..

This case is being prosecuted by Assistant U.S. Attorneys Francis Franze-Nakamura and Steven Masada of the Western District of Washington with assistance from Trial Attorney Anthony Teelucksingh of the Justice Department’s Computer Crime and Intellectual Property Section.