One needs to wonder about all those routers and firewalls from the majors that are produced in China.
Also, I think this will do more damage to “Brand China” than dubious tariffs.
And in case you missed it, Bloomberg’s original story “The Big Hack” (excellent read), can he had here
The discovery shows that China continues to sabotage critical technology components bound for America.
A major U.S. telecommunications company discovered manipulated hardware from Super Micro Computer Inc. in its network and removed it in August, fresh evidence of tampering in China of critical technology components bound for the U.S., according to a security expert working for the telecom company.
The security expert, Yossi Appleboum, provided documents, analysis and other evidence of the discovery following the publication of an investigative report in Bloomberg Businessweek that detailed how China’s intelligence services had ordered subcontractors to plant malicious chips in Supermicro server motherboards over a two-year period ending in 2015.
Appleboum previously worked in the technology unit of the Israeli Army Intelligence Corps and is now co-chief executive officer of Sepio Systems in Gaithersburg, Maryland. His firm specializes in hardware security and was hired to scan several large data centers belonging to the telecommunications company. Bloomberg is not identifying the company due to Appleboum’s nondisclosure agreement with the client. Unusual communications from a Supermicro server and a subsequent physical inspection revealed an implant built into the server’s Ethernet connector, a component that’s used to attach network cables to the computer, Appleboum said.
The executive said he has seen similar manipulations of different vendors’ computer hardware made by contractors in China, not just products from Supermicro. “Supermicro is a victim — so is everyone else,” he said. Appleboum said his concern is that there are countless points in the supply chain in China where manipulations can be introduced, and deducing them can in many cases be impossible. “That’s the problem with the Chinese supply chain,” he said.
The more recent manipulation is different from the one described in the Bloomberg Businessweek report last week, but it shares key characteristics: They’re both designed to give attackers invisible access to data on a computer network in which the server is installed; and the alterations were found to have been made at the factory as the motherboard was being produced by a Supermicro subcontractor in China.
The manipulation of the Ethernet connector appeared to be similar to a method also used by the U.S. National Security Agency, details of which were leaked in 2013. In e-mails, Appleboum and his team refer to the implant as their “old friend,” because he said they had previously seen several variations in investigations of hardware made by other companies manufacturing in China.
In Bloomberg Businessweek’s report, one official said investigators found that the Chinese infiltration through Supermicro reached almost 30 companies, including Amazon.com Inc. and Apple Inc. Both Amazon and Apple also disputed the findings. The U.S. Department of Homeland Security said it has “no reason to doubt” the companies’ denials of Bloomberg Businessweek’s reporting.
People familiar with the federal investigation into the 2014-2015 attacks say that it is being led by the FBI’s cyber and counterintelligence teams, and that DHS may not have been involved. Counterintelligence investigations are among the FBI’s most closely held and few officials and agencies outside of those units are briefed on the existence of those investigations.
Appleboum said that he’s consulted with intelligence agencies outside the U.S. that have told him they’ve been tracking the manipulation of Supermicro hardware, and the hardware of other companies, for some time.
Hardware manipulation is extremely difficult to detect, which is why intelligence agencies invest billions of dollars in such sabotage. The U.S. is known to have extensive programs to seed technology heading to foreign countries with spy implants, based on revelations from former CIA employee Edward Snowden. But China appears to be aggressively deploying its own versions, which take advantage of the grip the country has over global technology manufacturing.
Three security experts who have analyzed foreign hardware implants for the U.S. Department of Defense confirmed that the way Sepio’s software detected the implant is sound. One of the few ways to identify suspicious hardware is by looking at the lowest levels of network traffic. Those include not only normal network transmissions, but also analog signals — such as power consumption — that can indicate the presence of a covert piece of hardware.
In the case of the telecommunications company, Sepio’s technology detected that the tampered Supermicro server actually appeared on the network as two devices in one. The legitimate server was communicating one way, and the implant another, but all the traffic appeared to be coming from the same trusted server, which allowed it to pass through security filters.
In other words – by passing the firewall
Appleboum said one key sign of the implant is that the manipulated Ethernet connector has metal sides instead of the usual plastic ones. The metal is necessary to diffuse heat from the chip hidden inside, which acts like a mini computer. “The module looks really innocent, high quality and ‘original’ but it was added as part of a supply chain attack,” he said.
The goal of hardware implants is to establish a covert staging area within sensitive networks, and that’s what Appleboum and his team concluded in this case. They decided it represented a serious security breach, along with multiple rogue electronics also detected on the network, and alerted the client’s security team in August, which then removed them for analysis. Once the implant was identified and the server removed, Sepio’s team was not able to perform further analysis on the chip.
The threat from hardware implants “is very real,” said Sean Kanuck, who until 2016 was the top cyber official inside the Office of the Director of National Intelligence. He’s now director of future conflict and cyber security for the International Institute for Strategic Studies in Washington. Hardware implants can give attackers power that software attacks don’t.
“Manufacturers that overlook this concern are ignoring a potentially serious problem,” Kanuck said. “Capable cyber actors — like the Chinese intelligence and security services — can access the IT supply chain at multiple points to create advanced and persistent subversions.”
One of the keys to any successful hardware attack is altering components that have an ample power supply to them, a daunting challenge the deeper into a motherboard you go. That’s why peripherals such as keyboards and mice are also perennial favorites for intelligence agencies to target, Appleboum said.
In the wake of Bloomberg’s reporting on the attack against Supermicro products, security experts say that teams around the world, from large banks and cloud computing providers to small research labs and startups, are analyzing their servers and other hardware for modifications, a stark change from normal practices. Their findings won’t necessarily be made public, since hardware manipulation is typically designed to access government and corporate secrets, rather than consumer data.
National security experts say a key problem is that, in a cybersecurity industry approaching $100 billion in revenue annually, very little of that has been spent on inspecting hardware for tampering. That’s allowed intelligence agencies around the world to work relatively unimpeded, with China holding a key advantage.
“For China, these efforts are all-encompassing,” said Tony Lawrence, CEO of VOR Technology, a Columbia, Maryland-based contractor to the intelligence community. “There is no way for us to identify the gravity or the size of these exploits — we don’t know until we find some. It could be all over the place — it could be anything coming out of China. The unknown is what gets you and that’s where we are now. We don’t know the level of exploits within our own systems.”