Will Executive Order Impact Cybercrime?Obama Calls for Sanctioning Suspected Attackers
President Obama on April 1 issued an executive order that allows the U.S. government to block or seize the assets of suspected "malicious cyber actors." But some legal and security experts already are questioning whether the order is legally defensible or will have any meaningful impact on either cybercrime or online espionage.
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"There are so many problems with this," attorney Mark Rasch, a former U.S. Department of Justice official who created its computer crime unit, tells Information Security Media Group, citing, for example, the government's ability to presume someone is guilty, without first having to prove it. "In general, sanctions are a political tool for putting pressure on recalcitrant governments to change their ways, [but] these sanctions are a legal tool to impose punishment without trial on persons we believe to be criminals and hackers."
The Obama administration, however, says that the executive order - officially titled "Blocking the Property of Certain Persons Engaging in Significant Malicious Cyber-Enabled Activities" is necessary to give the U.S. government much-needed new legal tools in its fight against cybercrime and online espionage. The executive order represents the first time that the White House has authorized broad sanctions to be imposed specifically for cyber-attacks, and regardless of the location of whoever is behind the attacks.
"Our primary focus will be on cyberthreats from overseas, Obama writes on news website Medium. "In many cases, diplomatic and law enforcement tools will still be our most effective response. But targeted sanctions, used judiciously, will give us a new and powerful way to go after the worst of the worst."
The executive order authorizes the Secretary of the Treasury - in consultation with the Attorney General and the Secretary of State - to impose such sanctions "on individuals or entities that engage in malicious cyber-enabled activities that create a significant threat to the national security, foreign policy or economic health or financial stability of the United States," Obama says in an April 1 statement distributed by the White House.
While the executive order doesn't define "significant," it says sanctions can be imposed for a variety of reasons, for example, in response to attacks that target critical infrastructure, which disrupt networks - via distributed denial-of-service attacks, for instance - as well as for targeting or stealing trade secrets or personally identifiable information, and for computer crime in general.
Intent: To Fill Gaps
White House Cybersecurity Coordinator Michael Daniel says the executive order is meant to expand the "spectrum of tools" that the government can use to combat cyber-attacks, by supplementing current diplomatic, law enforcement, military, economic and intelligence capabilities.
"It is designed to fill in a gap that we have identified where individuals carrying out significant malicious cyber-attacks are located in places that it's difficult for our diplomatic and law enforcement tools to reach - whether because they're behind the borders of a country that has weak cybersecurity laws, or the government is complicit in or turning a blind eye to the activity that is happening, and we don't have good law enforcement relationships or other kinds of relationships," he said on an April 1 a press call. "So what we're doing is putting in place a tool that will enable us to impose costs on those actors."
John Smith, the Treasury Department's acting director of the Office of Foreign Assets Control, or OFAC, which administers and enforces U.S. economic sanctions programs, said on the press call that the executive order elevates cyber-attacks to the realm of such activities as counterterrorism, narcotics trafficking and transnational crime, which the United States targets, regardless of where they're based. Smith says the administration is hoping that by designating cybercrime and online espionage in this manner, more countries will be spurred to put a stop to related activities inside their borders, or which touches their financial system.
Sony Hack Inspired Order
The Washington Post reports that the executive order has been under development for the past two years. But Daniel says the need for the executive order was highlighted after the president called for a "proportional response" to the hack attack against Sony Pictures. "That process informed us as we were finishing up this executive order and highlighted the need for us to have this capability and to have this tool."
The move follows another executive order, signed by the president in January, that imposed sanctions on 10 individuals and three entities associated with the North Korean government, after the FBI attributed the November 2014 hack and wiper malware attack against Sony Pictures Entertainment to "North Korea actors." But numerous information security experts have continued to question that attribution.
Questioning the Rationale
And some legal and security experts are now questioning the rationale behind the new executive order. "It's really built out of frustration, because the international legal process does not deal effective with cybercrime," says Rasch, the former DOJ official. "So there's the urge to take the law into your own hands. Resist that urge."
Rasch adds that another problem with the executive order is that it's not aimed just at state sponsors - or nation-state-backed attackers - but anyone who the U.S. believes has broken the law. Furthermore, it allows the government to impose punishments, such as seizing U.S. citizens' assets, without any due process, or having to first prove the government's case.
The administration says that anyone who wants to contest sanctions that get imposed using this executive order can do so with OFAC, or by filing a lawsuit against the federal government.
But will the executive order lead to any meaningful reduction in cybercrime or online espionage? "I'm somewhat skeptical, to say the least," Sean Sullivan, a security adviser for Helsinki, Finland-based anti-virus firm F-Secure, tells ISMG. "There's a great deal of Russian-speaker-based 'espionage as a service' that would be very difficult to do much about. And China seems even more of a challenge. But then again, maybe there are some officials who do actually have American assets to go after - New York real estate, for example."
James A. Lewis, a cyberpolicy expert at the Center for Strategic and International Studies, believes that the new program could have an impact, for example to combat Chinese-promulgated economic espionage. "You have to create a process to change the behavior of people who do cyber-economic espionage," he tells The Washington Post. "Some of that is to create a way to say it's not penalty free. This is an effective penalty. So it moves them in the right direction."
But Rasch thinks it's unlikely that the executive order would fulfill the stated White House purpose of deterring future cybercrime, espionage and large-scale attacks. "The rogues are not going to be deterred by this," he says. "The state sponsors are not going to be deterred by this."