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Friday, May 26, 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

Biden, McCarthy Close to Debt Ceiling Deal.  President Joe Biden and House Speaker Kevin McCarthy are reportedly inching closer to a budget deal that could avert an economy-crippling default. The agreement, though not final, would reportedly boost discretionary military spending, and keep non-defense discretionary spending where it is, along with other negotiations. The two sides are apparently just $70 billion apart just days ahead of the June 1 deadline to raise the debt ceiling.  Reuters

US Warns China Could Hack Critical US Infrastructure.  The US State Department warned on Thursday that China is “most certainly” capable of launching cyberattacks to disrupt critical infrastructure in the US, like oil and gas pipelines and rail systems.  A State Department spokesperson made the warning in a press briefing, adding that “it’s vital for government and network defenders in the public to stay vigilant.”  The warning comes after cybersecurity and intelligence authorities in the “Five Eyes” nations issued an alert on Wednesday about a Chinese cyberespionage campaign aimed at US military and government targets. Microsoft said the campaign, which is linked to a new group called Volt Typhoon, targeted critical infrastructure in Guam and has the potential to disrupt critical US communications infrastructure in Asia.  China’s foreign ministry has rejected these accusations, saying they are part of a “collective disinformation campaign” launched by the US, which it called an “empire of hacking.”  Al Jazeera Reuters

Biden Nominates Air Force General Brown as Next Chairman of Joint Chiefs of Staff.  President Joe Biden formally nominated Air Force General Charles Q. Brown Jr. to be the next chairman of the Joint Chiefs of Staff.  Brown has served as chief of staff of the Air Force since June 2020 and most recently served as commander of Pacific Air Forces.  If confirmed by the Senate, Brown would be the second African American to be the top US general and will succeed Army General Mark A. Milley, who has been Joint Chiefs chairman since 2019 and will leave the post by the end of September.  In an announcement about his nomination, Biden called Brown a “top-notch strategist” and lauded his signature approach, which he described as “accelerate, change or lose.”  US Defense Secretary Lloyd Austin has also backed Brown, calling him “an outstanding joint warfighter and a thoughtful, strategic leader.”  Despite the support, Brown’s nomination may join over 200 other senior military nominations currently held up in the Senate by Republican Senator Tommy Tuberville in protest of the Pentagon’s reproductive health policies.  CNN US Department of Defense

Top US General Warns F-16s Alone Won’t Win the Ukraine War.  US Chairman of the Joint Chiefs of Staff Mark Milley on Thursday warned that F-16 fighter jets will not be a “magic weapon” in the Ukraine war, defending the US refusal to send the jets to Ukraine.  Following a virtual meeting of the Ukraine Defense Contact Group, Milley told reporters that Russia still has “1,000 fourth-generation fighters,” meaning that Ukraine will need a significant amount of advanced jets to contest Russia in the air.  Milley explained that sending the required amount of jets to do this would be far too expensive and would take up all approved funding for Ukraine military aid.  Because of this, he said the West’s approach of focusing on giving Ukraine integrated air defenses to “deny the Russians the airspace” was “the smartest thing to have done.”  While the US is firm against sending F-16s to Ukraine, it is still backing international efforts to train Ukrainian pilots on the jets, which US Defense Secretary Lloyd Austin said Thursday would be led by Denmark and the Netherlands.  Politico

US Navy Releases Scathing Report On SEAL Course.  The US Navy released a report Thursday that underlined “a near perfect storm” of problems at the Basic Underwater Demolition/SEAL course, known as BUD/S, which left several injured, and one dead.  “The investigation revealed a degree of complacency and insufficient attentiveness to a wide range of important inputs meant to keep the students safe,” the report found. Additionally, students began using illegal performance-enhancing drugs to make it through the course.  New York Times

Western Europe

Man Arrested After Crashing Car Into Downing Street Gates.  A man crashed a car into the gates of Downing Street on Thursday.  Police arrested him on suspicion of criminal damage and dangerous driving, but authorities say the incident is not being treated as terror related.  No one was injured and the area has since been reopened to traffic.  Associated Press BBC CNN

EU Reiterates Call to China Envoy for Beijing's Help in Ending Ukraine War.  Li Hui, China’s special envoy for Eurasian affairs, who is on a Europe tour focused on peacemaking efforts for the Ukraine war, met with Enrique Mora, the EU’s deputy secretary general for political affairs, in Brussels on Thursday.  After the meeting, Mora told reporters that she told Li that China must leverage its influence on Russia to end the conflict.  The EU has made this call before, urging Beijing to use its strong ties with Moscow to achieve the withdrawal of Russian forces from Ukraine.  Li has heard this message throughout his tour, including in Ukraine, where officials pressed the Ukraine peace plan, which demands Russia’s return of all Ukrainian territories.  Both the EU and China did not provide details on Li’s comments in his meeting with Mora.  Li is set to visit Moscow next to meet with Russian Foreign Minister Sergei Lavrov.  South China Morning Post

Central and Eastern Europe

Ukraine Downs 10 Missiles, Over 20 Drones in Latest Russian Attack.  Ukrainian officials report that Ukrainian defenses intercepted 10 missiles and over 20 drones launched in Russian attacks throughout the night against the capital Kyiv, the city of Dnipro and other areas in eastern Ukraine.  The Ukrainian air force said 17 missiles and 31 drones were launched in the attacks and that several of them hit targets in the Kharkiv and Dnipropetrovsk regions, where officials reported damage to residential areas and industrial facilities.  The office of Ukrainian President Volodymyr Zelensky reported that a fire broke out in the city of Kharkiv after an oil depot was struck twice.  Zelensky later said continued Russian rocket attacks on Friday hit a hospital in Dnipro, killing at least two people and injuring over 20.  BBC Kyiv Independent NPR Reuters

Wagner Group Begins Withdrawing from Bakhmut.  The head of Russia’s Wagner Group, Yevgeny Prigozhin, confirmed on Thursday that his mercenary group has started to withdraw from Bakhmut and is handing over its positions in the city to regular Russian troops.  The withdrawal of Wagner units comes five days after Russia declared it had finally captured the devastated city after months of fighting.  Prigozhin said Wagner units will “rebase to camps in the rear” and would be ready to return to Bakhmut if needed.  He also claimed that 20,000 Wagner fighters have died in battle for the city.  Ukraine has confirmed the Wagner withdrawal on the outskirts of Bakhmut, though Ukrainian defense officials say there are currently still Wagner fighters remaining inside the city.  Despite the victory of Russia’s seizure of Bakhmut, experts note that with the pullout of Wagner units, the Russian military will be strained to hold the city, especially once Ukraine begins its counteroffensive.  Associated Press New York Times Reuters

Russia Using Soviet-Era Bombs to Evade Ukrainian Air Defenses.  Ukrainian and US officials and military experts report that Russia is increasingly using Soviet-era bombs in Ukraine.  These older bombs launched from aircraft are proving more difficult for Ukrainian air defenses to track as they are aloft for just 70 seconds or less before hitting their targets.  Officials add that Russia is retrofitting some of these older bombs with satellite navigation systems that increase their range, essentially turning them into glide bombs, which some experts say are harder to intercept than Russia’s Kinzhal hypersonic missile.  Analysts note that Russia has thousands of these Soviet-era bombs and that modifying them costs a fraction of the price of an equally-destructive cruise missile.  In response to the threat from the glide bombs, some Ukrainian military officials say the only solution is to target the planes that are launching the bombs.  New York Times

Ukraine Vessel Appears to Hit Russian Reconnaissance Ship, Video Shows.  The Ukrainian Ministry of Defense on Thursday shared video footage that appears to show an unmanned surface vessel hitting the Russian reconnaissance ship Ivan Khurs in the Black Sea.  The footage shows the vessel rapidly approaching the Ivan Khurs and making it a few yards away from the ship before the feed cuts out.  The video appears to conflict with Russia’s claim that it repelled the attack on the Ivan Khurs on Wednesday.  The Russian Ministry of Defense said after the attack that the ship “continues to fulfill its tasks” in the region.  CNN

Russia Says Ukraine Launched Missile Strike Against Russian-Occupied Berdiansk.  Russian officials in the occupied Ukrainian city of Berdiansk say that Ukraine launched a missile strike against the city on Thursday.  Local officials did not report about casualties from the alleged strike and added that they are assessing if Ukraine used British-supplied Storm Shadow missiles.  Berdiansk is deep in Russian-controlled territory, around 62 miles from the front lines.  CNN

US Reiterates Ukraine Cannot Use US-Supplied Weapons for Attacks in Russia.  US Chairman of the Joint Chiefs of Staff Mark Milley reiterated on Thursday that the US has asked Ukraine not to use US-provided weapons to launch direct attacks into Russia and that US military aid for Ukraine is meant for the country’s self-defense against invading Russian forces.  Milley made the comment days after a cross-border incursion by apparent Russian militias into Russia’s Belgorod border region.  Milley said his office is analyzing the attack since he “can’t say with definitive accuracy” whether US-supplied weapons were used.  White House National Security Council spokesperson John Kirby echoed Milley’s remarks, saying the US does not want to “encourage or enable” Ukrainian attacks on Russia and that Kyiv has given “assurances” that it will respect this position, referring to conversations as recently as this week.  CNN Reuters

Russia Summons US Diplomats to Protest Sullivan’s Crimea Comments.  Russia’s Foreign Ministry summoned top US diplomats in Moscow on Friday to protest remarks from White House national security advisor Jake Sullivan about “effectively endorsing strikes” on Crimea.  The ministry did not specify the offending comments, but Sullivan said in a CNN interview on Sunday that the US has not placed limitations on Ukraine’s ability to strike its own territory to target occupying Russian forces and that “we believe Crimea is Ukraine.”  Reuters

Ukraine Says Putin Tops Kill List.  Vadym Skibitsky, deputy head of Ukraine’s military intelligence service, told a Germany newspaper on Thursday that Russian President Vladimir Putin is at the top of Ukraine’s kill list because “he coordinates and decides what happens” in the Russian invasion of Ukraine.  Skibitsky added that Putin is “noticing that we are getting closer and closer to him, but he is also afraid of being killed by his own people.”  Skibitsky also mentioned other Russians — Wagner Group head Yevgeny Prigozhin, Russian Defense Minister Sergei Shoigu, Chief of the General Staff Valery Gerasimov, and military commander Sergei Surovikin — as other targets that Ukraine wants to assassinate.  In response to his remarks, Kremlin spokesman Dmitry Peskov said that Russian security services “know their job and know what they are doing” and said that Skibitsky’s comments confirm Russia had a right to attack Ukraine to deal with a “terrorist regime.”  Reuters

Russia Moves Ahead With Deployment of Tactical Nuclear Weapons to Belarus.  Russian Defense Minister Sergei Shoigu and his Belarusian counterpart Victor Khrenin met in Minsk on Thursday to sign a deal to move forward with the deployment of Russian tactical nuclear weapons in Belarus.  Shoigu described the plan as a countermeasure to the “extremely sharp escalation of threats on the western borders of Russian and Belarus.” He also confirmed that Russia has provided Belarus with Iskander-M missiles and modified Su-25 aircraft, both of which can carry nuclear weapons, and trained Belarusian forces on relevant Russian nuclear weapons systems.  Russian President Vladimir Putin announced the deployment of the nuclear weapons to its ally earlier this year in what is widely seen as a warning against Western military support for Ukraine.  It is unclear when the nuclear weapons will be deployed or how many will be sent to Belarus, but Russia says storage facilities for the weapons in Belarus will be completed by July 1.  The US State Department condemned the move, but says it has seen no signs that Russia is preparing to use a nuclear weapon and that the US has no plan to alter its own position on strategic nuclear weapons.  The US believes Russia has around 2,000 operational tactical warheads.  Associated Press Reuters

Russia's Wagner Mercenaries Allegedly Gave Bodies of US, Turkish Citizens to Ukraine.  The head of Russia’s Wagner Group, Yevgeny Prigozhin said Thursday that he has handed the body of an American and a Turkish citizen killed amid fighting in Bakhmut over to Ukraine.  According to Prigozhin, the American, who he has named as former US special forces soldier Nicholas Maimer, was killed in the fighting in Bakhmut, while the Turkish man was killed in a building bombed by Ukrainian forces.  He added that the body of a Turkish woman was found near the body of the Turkish man but could not be recovered.  Ukraine’s Coordination Headquarters for the Treatment of Prisoners of War has confirmed that Maimer and the Turkish man’s bodies were handed over to Ukraine during a prisoner swap, though CNN reports that it was unable to independently confirm that the American body is Maimer’s body.  CNN Reuters

Serbian Army Deployed to Kosovo Border After Clashes.  Serbian President Aleksandar Vucic ordered the Serbian military to go on full combat alert and deployed units closer to the border with Kosovo after protesters in a majority Serb town in Kosovo clashed with local police.  Serbian defense minister Milos Vucevic confirmed the troop movement, saying it is needed since “terror against the Serb community in Kosovo is happening.”  Protesters in the town of Zvecan were attempting to prevent a newly elected ethnic Albanian mayor from taking office.  The unrest followed local elections which local Serbs largely boycotted to protest for greater autonomy, resulting in ethnic Albanian parties largely winning the vote.  Police eventually escorted the Zvecan mayor into his office.  Reuters

Asia and Oceania

Japan Escalates Sanctions on Russia, Condemns Nuclear Weapon Deployment to Belarus.  Japanese Chief Cabinet Secretary Hirokazu Matsuno reported on Friday that Japan will impose more sanctions against Russia over its invasion of Ukraine alongside other G7 nations.  Matsuno said the sanctions will include restrictions on engineering and construction services to Russia, export controls on 80 Russian entities, including research labs associated with the military, and the freezing of assets of 17 individuals and 78 groups linked to Russia’s military.  Matsuno also voiced Japan’s condemnation of Russia’s planned deployment of tactical nuclear weapons to Belarus, saying that Tokyo “never accepts Russia's nuclear menace, let alone its use."  Associated Press Reuters

Chinese Ships in Waters Near Vietnam, Russian-Run Gas Fields.  A Chinese research ship and five escort vessels remained in Vietnam’s exclusive economic zone (EEZ) on Friday near gas blocks operated by Russian firms in the South China Sea.  Vietnam had urged the ships to leave a day before.  The standoff adds to escalating tensions over maritime territorial disputes in the region.  China’s foreign ministry has defended the movements of its vessels in the area, saying they are carrying out “normal activities under China’s jurisdiction” and that they have not violated other countries’ EEZs.  Vietnam and Russian embassies in Hanoi have not commented on the matter.  Reuters

Thailand Says US Rejected Proposed Purchase of F-35 Jets.  Thailand’s Air Force reported on Thursday that the United States has rejected its request to purchase F-35 fighter jets.  Thai Air Force officials said that the US could not offer the sale due to time constraints and Thailand’s failure to meet technical requirements and maintenance compatibility.  Thai officials say the US will still help Thailand replace its aging fighter jet fleet by offering upgraded F-15s and F-16s. Reuters

Middle East and Northern Africa

Belgian Aid Worker, Iranian Diplomat Freed in Prisoner Exchange.  A Belgian aid worker jailed in Iran and an Iranian diplomat held in Belgium were released on Friday in a prisoner exchange mediated by Oman.  The Belgian aid worker, Olivier Vandecasteele was arrested in February 2022 in Iran and sentenced in January to 40 years in prison and 74 lashes on charges including spying.  The Iranian diplomat, Asadollah Assadi was sentenced to 20 years in prison in 2021 for links to a foiled bomb plot in France.  Belgium said at the time of Vandecasteele’s conviction that it was retribution for Assadi’s arrest.  Both Brussels and Tehran say the charges against their respective citizens are fabricated.  BBC Reuters

Sub Saharan Africa

Wagner Group Accused of Sending Surface-to-Air Missiles to Sudan’s RSF.  The United States alleged Thursday that the Russian Wagner Group has been providing Sudan’s Rapid Support Forces (RSF) with surface-to-air missiles in the ongoing conflict between the paramilitary force and Sudanese army.  Last month, US Secretary of State Antony Blinken expressed worries about the Wagner Group’s involvement in the Sudan war, suggesting that the group’s supply of weapons could prolong the conflict.  The Sudan accusation follows recent claims about Wagner’s increased military presence in Africa — the US Treasury Department recently sanctioned the head of Wagner in Mali, Ivan Aleksandrovich Maslov, for allegedly attempting to acquire weapons in Mali for Russia’s invasion of Ukraine.  Al Jazeera

Cyber and Tech

Mandiant Uncovers Russia-Linked Malware Targeting Industrial Systems.  Researchers at the Mandiant cybersecurity firm have disclosed that malware intended to breach and disrupt critical industrial control systems at infrastructure entities such as power plants has been traced to a Russian telecommunications company.  The malicious software dubbed CosmicEnergy was discovered on a Google-owned service, VirusTotal, and was uploaded from a Russian IP address.  Mandiant pointed out that the bug was found in the course of hunting for threats rather than following a system attack.  Researchers say CosmicEnergy is of the same malware family as Stuxnet and Industroyer, code designed to attack industrial systems.  According to Mandiant, it is unclear if CosmicEnergy was intended to be used in a cyberattack or if it was “developed for internal red-teaming exercises before the code was released into the wild.”  Some features of the malware suggest it may have been developed by Rostelecom-Solar, the cyber arm of Russia’s leading telecommunications firm.  Daniel Zafra, a Mandiant analyst, said the malware is “not something we see every day.”  It could signal the sophistication of developers in producing code specifically to take down the most critical systems.  CyberScoop

Microsoft Chief Proposes Rules To Minimize AI Technology Risk.  Microsoft President Brad Smith, citing the need for tech companies to “step up” and for government to “move faster,” laid out proposals for AI regulation on Thursday.  Included in the package was a requirement that critical infrastructure systems be given an “emergency-braking-like” capability to slow down or shut off completely.  Smith also gave support to a proposal from OpenAI CEO Sam Altman that companies that government regulators should require licenses in order for companies to introduce “highly capable” AI models.  He added that even when product licenses are granted, companies have the responsibility “to continue to monitor it and report to the government if there are unexpected issues that arise.”  Speaking of the worldwide recognition that regulation of AI innovations is necessary, Smith said “it would be a problem if we were advocating for regulation that only we could satisfy — that is not the case.  We are advocating for the kinds of laws and regulations that, I would argue, anyone who wants to be serious in the world of AI can and should meet.”  The Microsoft chief stressed that priority should be given to protect AI elements of critical infrastructure such as energy networks and transportation systems.  He also advocated for a presidential executive order that any company providing AI applications to the government should implement the NIST framework for voluntary AI risk-management.  New York Times Reuters Wall Street Journal

Iran Defense Minister Reveals Latest Ballistic Missile After ‘Successful’ Test Launch.  Iran says it has conducted a test launch of its latest ballistic missile, which it displayed to journalists on a truck-mounted launcher at an event in Tehran.  The Khorramshahr-4 weapon, according to Defense Minister Gen. Mohammad Reza Ashtiani, can be prepared for launch quickly and has detection-evading characteristics due to its low radar signature.  Ashtiani added that the missile, which has a reported range of 1240 miles and carries a 3,300-pound warhead, can be equipped with “various warheads for different missions.”  The liquid-fueled missile’s range indicates it can reach most of the Middle East but not West Europe.   Ashtiani noted that "our message to Iran's enemies is that we will defend the country and its achievements. Our message to our friends is that we want to help regional stability."  Associated Press Reuters

Brazilian Hackers Conduct Ongoing Hacking Campaign Against Portuguese Banks.  Users of more than 30 Portuguese commercial and government banks were targeted by a Brazilian hacking group earlier this year, according to a SentinelLabs report.  Researchers note that the hacks into financial systems enable attackers to extract data and personal information that can be used for “malicious activities beyond financial gain.”  The ongoing “Operation Magalenha” campaign, which saw a peak in attacks last month, initially was carried out through Western cloud service providers.  Researchers say that due to new restrictions on use of those systems, the operation has shifted to TimeWeb, a Russia-based web host service.  The latest intrusions employ pairs of backdoor malware that seize control of infected computers and allow attackers to “monitor window interaction, take unauthorized screenshots, terminate processes and deploy additional malware, such as data exfiltration tools.”  SentinelLabs analysts said the hacking operation demonstrates “the persistent nature of the Brazilian threat actors,” adding that the hacking groups have been adept at updating both malware and tactics, “allowing them to remain effective in their campaigns.”  CyberScoop The Record BleepingComputer

EU Minister Says AI Rules Not Negotiable in Response to Perceived OpenAI Threat.  In response to a comment by OpenAI CEO Sam Altman that his company may need to consider withdrawing from the European market if it could not comply with forthcoming EU regulations on generative AI products, EU internal markets minister Thierry Breton told Reuters "our rules are put in place for the security and well-being of our citizens and this cannot be bargained."  Breton recently met with Google’s CEO and said they came to agreement on a voluntary “AI Pact” that will provide guidelines as the EU AI Act continues to be discussed and developed.  In a tweet, Breton elaborated on his response to Altman’s remarks:  "There is no point in attempting blackmail — claiming that by crafting a clear framework, Europe is holding up the rollout of generative AI."  Reuters Barrons

Nvidia CEO Deems China Market ‘Very Important’ as Demand for AI Chips Mounts.  Nvidia CEO Jensen Huang affirmed China as a “very important” market for the technology industry, and described U.S. export controls on the most advanced chips akin to “our hands tied behind our back.”  The U.S. restrictions on Nvidia’s most advanced GPU’s have affected Nvidia revenues and compelled the company to send lower-end chips to Chinese customers.  Huang said that in the face of U.S. export controls, China will “just build it themselves.”  Huang said the “U.S. has to be careful,” adding that U.S. companies could suffer “enormous damage” due to trade restrictions with China.  He also commented on existing and future U.S. technology governance rules, saying “If they’re not thoughtful on regulations, they will hurt the tech industry.”  Financial Times South China Morning Post

Pentagon Establishes ‘Joint Futures’ Team To Examine Military’s Technological Future.  A new DoD Joint Staff team is performing an analysis that could lead to the creation of a “Joint Futures” component focused exclusively on preparing the military services for technology-enabled operations beyond 2030.  Reportedly, the standing up of the team late last year grew out of the convictions of Joint Chiefs Chairman Gen. Mark Milley that his role is to enable troops to “innovate more like they fight.”  The envisioned “Joint Futures” entity could be a new unified command or office within the Pentagon.  The team’s leader, Maj. Gen. Patrick Gaydon, noted that “every option is still on the table.”  He affirmed that whatever the shape and type of the new organization, “we need an organization focused on the future.”  The military services’ dependence on collaborative technology is a key motivation for the team’s work, Gaylord explained, adding that “we have to be able to adapt to the changing character of war.”

DefenseScoop

Spyware Planted on Phones Used by Member of Mexican President’s ‘Inner Circle’.  Spyware has been discovered on the cellphones of a member of the Mexican president’s cabinet and two of his staff members.  Alejandro Encinas, the undersecretary for human rights, is one of the closest allies of President Andres Manuel López Obrador; both are long-time members of Mexico’s leftist political movement.  On taking office in 2018, the president directed Encinas to investigate the disappearance of 43 students at a teachers college.  Last August, Encinas blamed several entities, including the police, armed forces, and drug traffickers for the abductions and “subsequent coverup.”  Reportedly, Mexico’s security forces have been active users of surveillance technology to monitor phones of opposition politicians, journalists, and human rights activists.  The presence of the spyware on Encinas’ phone was discovered late last year in a forensic examination conducted by Citizen Lab.  President Lopez Obrador downplayed the hacking at his daily news conference on Tuesday, saying he did not believe the army was responsible.  Washington Post

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