Isikoff: U.S. ignored hack warnings from secret source inside the Kremlin — Breach, episode 4, podcast and transcript

On episode 4 of Breach, our podcast about the massive Yahoo hack, investigative journalist Michael Isikoff appears to provide a much deeper view of Russian attacks on critical U.S. systems during the past decade. Isikoff is one of the most important journalists of our generation, and he becomes part of the story on a couple of occasions: It’s his story which is cited by Republicans as evidence in the infamous memo alleging surveillance abuses by U.S. intelligence services.  Isikoff’s reporting on the suspect hacking of Democratic National Committee consultant Ali Chalupa has also been the subject of much Internet debate.

Isikoff is now Chief Investigative Correspondent for Yahoo! News, and the co-author of the new book Russian Roulette: The Inside Story of Putin’s War on America and the Election of Donald Trump.

Listen by hitting play above, or read this partial transcript. Or, go back to the beginning if this is your first time here.  Or listen on iTunes. 

MICHAEL:

One of the early stories I did on the Russian attack on the election, was about a woman named Ali Chalupa who had been working at the DNC as a consultant.  She’s a Ukrainian American, and got quite energized when she learned that Paul Manafort joined the Trump campaign, because Manafort of course had been working for years for the Yanukovych  government in Kiev, the pro-Russian political party aligned with Vladimir Putin.  And the idea that somebody who was a consultant to the allies of Vladimir Putin would now be working for the Trump campaign, was a very big deal to Ali Chalupa, and she began trying to get the DNC to pay attention to this.  And then right in the middle of this, and this is the Spring of 2016, she gets a pop-up message from Yahoo security, saying that her email has been targeted by state-sponsored hackers.

Click to view Michael Isikoff’s book on Amazon.

ALIA:
So, while Ali Chalupa’s Yahoo account was definitely hacked, we don’t know that it was connected to our specific Yahoo breach.

MICHAEL:

But I did verify from Yahoo security that this was a real message and that it was a serious matter, what happened to Ali Chalupa.

BOB:

I can’t help but think looking back, are you afraid somebody was looking at your Yahoo emails?

MICHAEL:

Well, I had a Yahoo corporate email, and that was a question I asked right from the get go ‘did the did the Russian hackers who got in also get into our corporate emails?’ and I never got an answer to that question.

ALIA:

But as for my my tidy red string tying the DNC hack to the Yahoo hack via Ali Chalupa’s Yahoo account.

BOB:

There are other plausible explanations, beginning with the fact that we now know that Yahoo was essentially a hacker’s playground this whole time.

ALIA:

So, there’s no reason to believe these alleged Russian hacks are even under the same Russian mandate.

BOB:

I think we we run a great risk in thinking about Russian hackers as like a room full of people in Moscow, when in fact we’re talking about thousands, tens of thousands, maybe hundreds of thousands of people.  And it would be- imagine the situation in reverse.  Some American hackers hack a Chinese social media site and suddenly China says all Americans have hacked us.  So, there certainly are some pieces that lead you to say this needs some serious investigation.  The most persuasive one for me, which we’ve hinted at already, is the fact that Alexsey Belan’s name appears both on the indictment, where the US alleges that Russians hacked Yahoo, and on the list of sanctions imposed by Pres. Obama in December 2016, in retaliation for in general election hacking.  The fact that Alexsey Belan is on both of those documents, suggests to me that somebody in the state department has connected those two things.

ALIA:

So, maybe it’s not Alexandra Chalupa that is our connection between the DNC hack and the Yahoo hack.  You’re saying it’s Belan.

BOB:

I think Belan is the clearest piece of evidence we have that somebody has connected these dots.  But again to be as specific as we can, when the state department issued these sanctions, immediately after the election, the US sanctioned nine entities and two individuals.  The two individuals stand out.  One of them is a Evgeniy Bogachev, who is perhaps the world’s most famous internet bank robber, and the other one is Belan.  And the paragraph says specifically the Department of the Treasury is designating two Russian individuals, Bogachev and Belan, under a pre-existing portion of the executive order, for using cyber enabled means to cause misappropriation of funds and personal identifying information.  So this is an unsatisfying connection, because that specifically says they committed ID theft and banking fraud.  If they wanted to, they could have said ‘and potentially meddling also in the election.’  However, I think it can’t be ignored that this happened at- its its retaliation for the election.  So, to me this is statecraft, shot across the bow, we think we know what you’re up to kind of thing.  But again, you know Belan hasn’t been indicted in any formal way, or as far as we know even alleged by the US Government to have been involved in attacking our elections.  So, we have to avoid the sort of urge to homogeneity and our natural urge to make sense out of pieces of information that don’t necessarily make sense and put them into one frame and our desire for a Hollywood ending.  We may not get that satisfying Hollywood ending here.

ALIA:
Breaking News: On March 22, The Daily Beast reported that it has been revealed that Guccifer 2.0, the lone hacker who took credit for providing Wikileaks with stolen emails from the DNC, was a Russian intelligence officer, working for the GRU.  So, maybe no Hollywood ending, but…

We’re gonna take a quick break, so I can go figure out some metaphors that are as good or better than Bob’s.  I wanna be a metaphorist, like a florist, but like a metaphorist.  Is that real?  Don’t give me that look Bob.

MICHAEL:

The US government had a secret source inside the Kremlin, who was giving pretty explicit warnings about the information warfare plans that the Russians were mounting.  It’s a reflection of Putin’s worldview, where he sees the US as his main adversary.  And he knows he can’t have a military confrontation with the United States, but he has other ways of poking at us, and I think the information warfare playbook was was front and center.  Gen.  Gerasimov, who was the chief of staff of the Russian military, had written this piece in 2013, in an obscure military journal, about how the nature of warfare was evolving, and it was now evolving into areas of information warfare, of where the most important battlefronts wouldn’t be with tanks and physical armies, but in the cyber sphere.  And it was a pretty explicit game plan that was being laid out, and wasn’t fully appreciated by the US government.  The US intelligence community saw it in Ukraine, they saw it elsewhere in certain places of eastern Europe, but this is a classic case of the dots not being connected.

ALIA:

It’s not as if cyber attacks are new for the United States.

MICHAEL:

After all, we’d had cyber espionage before.  They attacked the State Department computers, they attacked the White House computers.  These were very big deals in the world of cyber security, of government cybersecurity, but the government never went public with it.

ALIA:

If you look back at the timeline-

MICHAEL:

Remember, the Russians got into the computer networks of the US Central Command, they attacked the State Department computers, they attacked the White House computers, but the government never went public with it.  They never called out the Russians, because that was sort of the thinking at the time: ‘we’ll handle this quietly, we don’t want to escalate it.’  There were people, even during the 2014 attack on the White House, that were suggesting this called for a response.

ALIA:

And even earlier-

MICHAEL:

I mean, it was known that there’d been a hack of the Obama and the McCain campaigns, but the US Government had never publicly attributed it to the Chinese, because that’s the way things were done back then.

ALIA:

But this hands-off approach stopped working towards the end of the Obama era.

MICHAEL:

There was a substantial uptick in the tempo of foreign state-sponsored cyber attacks on the US, and the traditional cybersecurity methods and techniques that were being used by the Government just weren’t working.

ALIA:

Because it stopped being simple espionage, when Russia began using cyber attacks to influence the American electorate, by dumping the DNC hack emails days before the Democratic National Convention.

MICHAEL:

That was the first big shot across the bow, that told everybody this wasn’t just standard cyber espionage.

ALIA:

So how do the Yahoo hacks fit into this timeline of escalating attacks?

BOB:

I mean, as you do point out though, I think the remarkable thing is this public call out, as far as I know the first time FSB agents have been indicted by the US Government for computer hacking.  So, that that must mean, like what does that mean?

MICHAEL:

Well, you know it’s it’s at least a form of public attribution, it’s calling them out.  We don’t get access to these people, they’re not going to be extradited, there actually isn’t even an extradition treaty between Russia and the United States.  So, the prospect that we’re going to get hold of these people, and and and try them in a US courtroom, and imprison them if they’re found guilty, is highly highly unlikely, but it’s a marker.  Look, Robert Mueller, the Special Counsel, just indicted 13 people from the Internet Research Agency, the troll farm in St.  Petersburg.  There’s no expectation that those people are gonna get turned over by the Russians, but it’s a it’s a way of drawing down a line, and saying ‘we view this, what you did as a criminal act.’  Now we are still waiting for the indictment of those who perpetrated the DNC hack, or the Podesta email hack.  So are we going to indict Vladimir Putin?  Will he be an unindicted co-conspirator in the indictment of the perpetrators of the DNC hack?  It is interesting that in the Yahoo indictment, it says in addition to the FSB officers who are indicted by name, this was a conspiracy with others known and unknown to the grand jury.  And one of those known, was a senior official in charge of Center 18, at the FSB.

BOB:

That indictment, much like the Yahoo hack indictment, is full of painstaking detail.  Bang, here we have a fact, here is amazing detail of the kind of lengths that Russia will go to, in an organized way, that comes very very close to Vladimir Putin’s doorstep, that they are involved in manipulating our election, that they have this incredible technology capability that that is refined, and it’s professionalized.

I mean, your mind wanders to how useful would it be, if you were trying to commit these larger nationstate hacks, to have access to every Yahoo email ever.

MICHAEL:

Oh, I mean- it would be an enormous intelligence trove.

ALIA:

It’s not unheard of for a country like Russia to gather intelligence, to read our emails, to whatever, right?  What is unheard of, is them weaponizing that information, that intelligence.  And now we have proof that that’s what has happened.

BOB:

You know, I think you can imagine in your head a meter that suggests you know when does the cold war start to become hot.  And when you start using words like ‘well they weaponized the digital world to interfere with our election,’ well that’s a cold war that’s getting warm, and that’s the seriousness of this issue.  I am less afraid of this digital cold war starting a shooting war, than I am afraid that we will lose it, without a single shot being fired.

ALIA:

We’ll lose it, because it’s happening under our noses, and we’re not taking it seriously.

BOB:

We just can’t be bothered to pay attention to it, nor can we be bothered to examine the issues deeply enough to understand what’s really happening to us.

(Listen to the entire Breach series of podcasts here.)

About Bob Sullivan 1204 Articles
BOB SULLIVAN is a veteran journalist and the author of four books, including the 2008 New York Times Best-Seller, Gotcha Capitalism, and the 2010 New York Times Best Seller, Stop Getting Ripped Off! His latest, The Plateau Effect, was published in 2013, and as a paperback, called Getting Unstuck in 2014. He has won the Society of Professional Journalists prestigious Public Service award, a Peabody award, and The Consumer Federation of America Betty Furness award, and been given Consumer Action’s Consumer Excellence Award.

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