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6:00 PM ET, Thursday, July 20, 2023

The Cipher Brief curates open source information from around the world that impacts national security. Here's a look at today's headlines, broken down by region of the world:  

In the Americas

U.S. Admiral Says China Ignored Defense Chief Conference Invitation in Continued Snub of Military Communication.  Admiral John Aquilino, commander of the U.S. Indo-Pacific Command, said that China has ignored or declined U.S. attempts to facilitate military dialogue, including a recent invitation for China to attend an annual chiefs of defense conference in Fiji next month.  Beijing has been unreceptive to U.S. overtures for high-level military communication with experts and officials saying China will not change course due as U.S. continues to strengthen engagement with Taiwan and maintains sanctions on Chinese defense minister Li Shangfu over his past work for allegedly transferring Russian jets and missiles to China.  South China Morning Post

U.S. Imposes New Russia-Related Sanctions.  The U.S. imposed new Russia-related sanctions against nearly 120 individuals and entities on Thursday.  The Treasury Department said the measures target Russia’s metal and mining sector and further curb its future energy capabilities, access to the international financial system, and ability to acquire military supplies.  The department added that the sanctions aim to fulfill G7 commitments to block Russian access to foreign-made electronics and technology obtained through third-parties and intermediaries outside of Russia.  Sanctioned individuals include a North Korean accused of supplying munitions to Russia, six Russian deputy ministers, a deputy director of the FSB, and the governor of the Smolensk region.  Sanctioned entities include two private Russian military companies, almost a dozen Russian entities that import foreign-made dual-use technologies, nearly 30 Russian weapons producers and defense research institutes, five Russian financial institutions, and companies based in the Kyrgyz Republic, the UAE and Serbia.  U.S. Secretary of State Antony Blinken said the sanctions will “further hold Russia accountable” for the Ukraine war.  Associated Press Reuters U.S. Department of State 

Western Europe

Britain Sanctions Wagner Individuals, Companies in Africa.  The UK on Thursday sanctioned 13 individuals and entities allegedly linked to Russia’s Wagner Group and accused of executions and torture in the Central African Republic (CAR) and Mali posing a threat to peace and security in Sudan.  In the CAR, sanctions target Konstantin Pikalyov, who is seen as a key advisor to Wagner head Yevgeny Prigozhin and the operational head of the mercenary group’s operations in the country, as well as Vitaly Perfilov and Alexander Maloletko, who is seen as a close associate of Prigozhin.  The sanctions also target Ivan Maslov, the head of the Wagner Group in Mali, and Mikhail Potepkin, the Wagner-linked director of the Meroe Gold mining company, which was also sanctioned for allegedly acting as a front for Wagner.  Al Jazeera Reuters

EU Sanctions Targets in Afghanistan, Russia, Elsewhere for Human Rights Violations.  The EU on Thursday sanctioned 18 individuals and 5 entities for human rights violations in Afghanistan, South Sudan, Central African Republic, Ukraine and Russia.  In Afghanistan, the sanctions target the Taliban ministers of Education and Justice and the acting Taliban Chief of Justice of the Afghanistan Supreme Court for sexual and gender-based violence.  In Russia, sanctions target those responsible for the misuse of facial recognition technology for “arbitrary arrests” and the politically motivated rulings against Kremlin critics and opposition figures.  Reuters

EU Imposes Additional Myanmar Sanctions.  The EU on Thursday imposed a seventh round of sanctions on Myanmar to pressure the military junta for its crackdown against opposition and human rights violations.  The new sanctions target six individuals — including the ministers for immigration and population, labor, and health and sports — and one entity.  The junta came to power in a military coup in 2021 and has been fighting a resistance movement since then.  Reuters

Central and Eastern Europe

Ukraine to View Ships Traveling to Russian-Controlled Ports as Possible Carriers of Military Cargo.  Ukraine’s Defense Ministry on Thursday said it will consider ships bound for Russian ports or Russian-occupied Ukrainian ports on the Black Sea as potential carriers of military cargo.  The ministry suggested it could take action against such ships, referring to last year’s sinking of the Moskva, the flagship of Russia’s Black Sea Fleet, when it said Ukraine has “the necessary means to repel Russian aggression at sea.”  The ministry also ruled that navigation through the northeastern part of the Black Sea and Kerch-Yenikal Strait of Ukraine is now banned.  The move mirrored Russia’s decision to treat ships bound for Ukrainian ports as potential carriers of military cargo after it withdrew from the Black Sea grain deal that facilitated the export of foodstuffs from Ukrainian ports.  Reuters

Russia Imposes Travel Restrictions on British Diplomats.  The Russian government has imposed new restrictions on British diplomats that require diplomats to give at least five working days notice of any plans to travel beyond 120 km radius. The document will be required to have the timing, purpose, type of trip, planned business contacts, accompanying persons, type of transport, places of visit and accommodation, and the route that will be taken.  The Soviet-style restriction came as Britain’s charge d’affaires in Russia was reprimanded during a meeting with Russia’s foreign minister in Moscow on Thursday for what Moscow considered as support for the “terrorist actions” of Ukraine and for obstructing Russian diplomacy in Britain. The Foreign office and Britain’s embassy in Moscow have declined to comment.  Reuters

Russian Prosecutors Seek Additional 20 Years in Prison for Opposition Leader Navalny.  Russian State prosecutors on Thursday asked a Moscow court to sentence jailed opposition leader Alexei Navalny to an additional 20 years in a penal colony.  Navalny has been on-trial behind closed doors for months at the IK-6 penal colony in Melekhovo, east of Moscow, where he is already serving 11-1/2 years for fraud and other charges, which he denies and maintains were trumped up in order to silence him.  The new charges prosecutors have charged Navalny with include inciting and financing extremist activity and creating an extremist organization. The verdict is set to be announced on August 4.  Reuters

Asia and Oceania

China, Russia Begin Joint Drills in Sea of Japan,  Chinese state media CCTV reported on Thursday that China and Russia have begun joint drills in the Sea of Japan.  Chinese media stated that "[t]he joint exercises will test the ability of the Chinese and Russian armies to integrate joint operations in distant waters”. Both sides are reportedly focusing on sea and air escorts, deterrence and repulsion, anchorage defense, and other courses during the drills.  Reuters

North Korea Threatens Nuclear Retaliation over U.S. Weapons.  North Korean Defense Minister Kang Sun Nam criticized the presence of U.S. strategic assets in the region and threatened retaliation, saying that the deployment of such assets “may fall under the conditions of the use of nuclear weapons specified in the DPRK law.”  His comment refers to assets such as B-52 bombers in joint patrols with the South Korean air force and visits by nuclear submarines to South Korean ports.  Kang’s statement came after a U.S. soldier crossed the border into North Korea on Tuesday.  The North Korean government has not commented on the incident.  Reuters Al Jazeera

First Senior Ukrainian Official Visits China Since Start of Russian Invasion.  Ukrainian Deputy Economy Minister Taras Kachka met with China’s Vice Commerce Minister Ling Ji in Beijing on Thursday, marking the first high-level visit by a Ukrainian government official to China since the start of the Ukraine war.  Chinese Vice Commerce Minister Ling stated that China is willing to "establish cooperative relations between the investment promotion agencies of the two countries, and continuously expand the space for trade and investment cooperation.". Ukrainian Deputy Economy Minister Kachka stated: “The Ukrainian side will step up efforts to protect the safety of Chinese-funded enterprises in Ukraine,” adding that Ukraine is “willing to work together with China to promote the healthy and sustainable development of economic and trade relations between the two countries."  The visit came after Russia’s decision on Monday to withdraw from the Black Sea grain deal, which China was the main export beneficiary of.  It also came amid reports that China’s consulate building in Odessa was damaged during the Russian attack late on Wednesday night, though it is unclear whether the attack took place before or after the meeting in Beijing.  Reuters

Middle East and Northern Africa

Ex-Israeli Security Chief Supports Reservists’ Protest.  The former head of Israel’s Shin Bet internal security agency, Nadav Argaman, on Thursday announced his support for reservists protesting against Israeli Prime Minister Benjamin Netanyahu’s proposed judicial overhaul.  The reservists against the reform have joined critics saying it will undermine Israeli democracy and are threatening to withhold their voluntary service if the plan goes through.  Argaman added to this chorus of concern, saying that the legislation appears to be an attempt by Netanyahu’s ruling coalition to preserve its power and that he is “very worried that we’re on the verge of a civil war” given the fierce divisions in Israel over the plan.  He added that reservists are protesting because they “are very concerned and fearful for the security of the state of Israel.”  Netanyahu has so far said he will press on with the reform.  Associated Press

China to Invest $36 Billion in Algeria.  Algerian President Abdelmadjid Tebboune announced on Thursday that China plans to invest $36 billion across multiple sectors in Algeria including manufacturing, new technologies, knowledge economy, transport, and agriculture.  Tebboune’s announcement came during an official visit to China, which included a meeting with Chinese President Xi Jinping.  Tebboune added that Algeria plans to bring economic relations with Beijing to the level of “good historical political relations.”  Reuters

Algerian Criticizes Israel’s Recognition of Moroccan Sovereignty over Western Sahara.  The Algerian government on Thursday strongly criticized Israel’s recognition of Moroccan sovereignty over the Western Sahara, claiming that the move violates international law.  The Algerian Foreign ministry said in a statement that "[t]he decision... can in no way legitimize sovereignty over occupied Sahara lands".  A U.S. State Department spokesperson had announced on Wednesday that US recognition of Morocco’s sovereignty over the Western Sahara remains unchanged.  Reuters

Sub Saharan Africa

Bomb Blast in Eastern Democratic Republic of Congo Leaves Nine dead.  An explosive device accidentally detonated on Wednesday evening in Lubwe Sud in North Kivu province, leaving at least nine dead and 16 injured. A local civil society figure, Justin Mwangaza, said a civilian had picked up a bomb in a field and had handed it over to local militiamen when it detonated. Medical personnel at a nearby clinic confirmed the deaths, stating that two were killed immediately while the other seven succumbed to their injuries. Some of the 16 wounded people are reportedly in critical condition.  Al Jazeera

Cyber and Tech

Microsoft To Offer Customers Access to Security Logs After Suspected China Hack.  In the wake of suspected Chinese hacks against its cloud-based email systems, Microsoft will offer at no cost tools that can help spot future cyberattacks.  The company’s decision to permit access to log activity systems followed criticism for vulnerabilities that led to compromised email servers at organizations worldwide, including State and Commerce Department officials.  In September, Microsoft will open access to 31 security logs to cloud service clients, including the email log type that identified the China-linked attacks.  Eric Goldstein, CISA’s executive assistant director for cybersecurity described Microsoft’s action as “a significant step forward to ensuring that every Microsoft customer has the right visibility to detect other threats that we know are targeting American organizations every day.”  In a statement, Goldstein noted Microsoft’s role as a founding partner of the Joint Cyber Defense Collaborative, and said the company’s new commitment is “a significant step toward creating a world where technology is safe and secure by design.”  Microsoft’s vice president for security, Vasu Jakkal, noted that discussions had been under way for a year between the company and the Biden administration on making cost-free security logs available to customers.  Jakkal did not link Microsoft’s announcement on Wednesday to the Chinese cyberattacks but said, “there was clearly an urgency to get this done, given the sophistication of the landscape.”  Wall Street Journal Axios TheRecord CyberScoop Bloomberg

North Korean Hackers Mount “Supply Chain” Attack Targeting Cryptocurrency.  A U.S. IT management firm, JumpCloud, was hacked in late June by a North Korean government-backed threat group that used the system breach to target cryptocurrency companies.  JumpCloud said that fewer than five customers were impacted by the hack, which accessed company systems in an attempt to steal digital cash from it cryptocurrency clients.  It has not been determined if digital currency actually was stolen, and JumpCloud declined to answer Reuters’ inquires about clients affected.  The attack appears to reflect a new tactic of breaching systems that can yield access to multiple cryptocurrency accounts as an alternative to hacking individual crypto companies.  A cybersecurity analyst not involved in the investigation said the JumpCloud intrusion demonstrates North Korean hacking group skills in “supply chain attacks,” where service provider systems are compromised to steal data or money from downstream clients.  The breach is being investigated by the CrowdStrike cybersecurity firm, which reported that “Labyrinth Chollima,” its name for the North Korean threat actor, was behind the attack.  A CrowdStrike executive, Adam Meyers, said the group has a history of cryptocurrency attacks, adding "one of their primary objectives has been generating revenue for the regime."  “Labyrinth” has the reputation as a prolific and daring hacking group, with previous hauls of an estimated $1.7 billion in cryptocurrency from a number of attacks.  Meyers said, "I don't think this is the last we'll see of North Korean supply chain attacks this year."  Reuters BleepingComputer The Record

Ukraine Reports Russian Spyware Attacks Against Military Units.  Ukraine’s Computer Emergency Response Team (CERT-UA) reports that the Russia-linked Turla hacking gang is deploying spyware against Ukrainian military forces.  CERT-UA said it has observed the gang, which is associated with Russia’s FSB intelligence service, targeting defense units with Capibar and Kazuar spyware.  Capibar attacks Microsoft Exchange servers with a Powershell tool that transforms the targeted system into a malware control center.  The malware is introduced to the system through “lure” emails containing malicious attachments which, one opened, trigger the Powershell tool.  CERT said that fake utility bills purportedly from genuine Ukrainian energy companies have been used as lures.  On some occasions the Kazuar “multi-functional backdoor” is downloaded, allowing various kinds of data, including passwords, cookies, and databases to be extracted from cloud services.  Microsoft Threat Intelligence reports that a particular target are files containing messages from the Signal messaging app, which allow access to private Signal conversations, as well as documents, images, and archive files on targeted systems.  CERT-UA did not describe the effectiveness of the Turla spyware or how many victims it infected.  The Record

Challenges Mount for U.S. Energy Systems Amid Cyber Threats, Renewable Innovations.  Experts in energy infrastructure testified Tuesday before a House energy subcommittee that risks and challenges are mounting for the U.S. power grid and its infrastructure.  The threat environment involves both foreign adversaries and domestic terrorists, according to the testimony.  Bruce Walker, a former official with the Energy Department’s Office of Electricity, said that cybersecurity and physical security are the most important elements to be addressed in the face of the evolving threat.  He said the issue demands a different strategy, urging that the U.S. adopt “an all-of-society approach that, among other things, appropriately uses federal capabilities to protect the grid.”  Among other risks facing the country’s energy infrastructure is its reliance on critical components from countries like China, and vulnerabilities in power transformers and new grid technologies to both cyber- and physical attacks.  Paul Stockton, senior fellow at a Johns Hopkins laboratory, said “risk-base, cost-effective ways” of addressing these risks need to be developed, which involves leveraging assets and resources of “the private sector, including device manufacturers, standard-setting organizations and operators of the power grid."  Sam Chanoski, a manager with the Idaho National Laboratory’s Cybercore Integration Center said the U.S. transition to sustainable energy alternatives, including electric vehicles, poses new protection challenges, including defending EV charging stations against critical cyber threats.  The resulting demands for transport electrification "are coming at us so fast that the grid is going to be challenged to keep up with it," Chanoski said.  The Energy Department this week announced a $15 million funding program for multi-year research and development of microgrid-related technologies that can support indigenous and underserved communities.  NextGov

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