OVERNIGHT TECH: South Korea cyberattack raises fears from lawmakers

THE LEDE: Fears that North Korea is gaining the capability to launch a crippling cyberattack against American infrastructure are rising in Washington after the South Korean banking and media sectors suffered Internet disruptions this week.

"North Korea's cyber capability should not be underestimated and its intent is difficult to assess," Rep. Patrick Meehan (R-Pa.), chairman of the House Homeland Security's Cybersecurity subpanel, said in his opening statements at a Wednesday hearing that examined cyber threats stemming from China, Russia and Iran.

"We must keep a watchful eye on this continued threat actor," Meehan added.

Two South Korean banks and three TV stations suffered from Internet outages on Tuesday, according to media reports. There has been speculation that North Korea could be the culprit behind the attacks, but so far no hard evidence has linked the country to the Internet outages. A spokesman for South Korea's president told The Wall Street Journal that it could not confirm whether North Korea was behind the disruption and was still investigating the cause of it.

Ilan Berman, vice president at the American Foreign Policy Council, said the United States generally "understands the direction" of China and Russia's cyber strategy, but "that's missing" in the country's calculation with Iran and North Korea.

Iran is believed to have launched a series of denial of service attacks against the public websites of U.S. banks this fall, which stirred concern from American policymakers.

Berman warned that Iran "can acquire very quickly and surreptitiously extensive cyber warfare capabilities" from the black market, as well as "from a strategic partner like China."

Frank Cilluffo, director of the Homeland Security Policy Institute at The George Washington University, warned that North Korea is a "wild card" in terms of its intent to launch a cyberattack against the U.S. But he also noted that Russia and China's cyber capabilities should not be underestimated.

So far, Russia and China have reportedly been focused on stealing American intellectual property and trade secrets, rather than carrying out a physical attack against the U.S.

"If you can exploit, you can attack," he warned. "We need to improve our defense, but we also need to invest in our offensive capabilities."

Meehan told The Hill that he planned to hold more hearings on the cyber threats facing the country, such as the recent attacks against the U.S. financial sector.

Rep. Michael McCaul (R-Texas), the chairman of the Homeland Security Committee, aims to pass a cybersecurity bill out of the committee this spring. McCaul and Meehan have already conducted a series of meetings with various industry groups to solicit their feedback for legislation. They met with a group of tech companies, including Oracle, on Tuesday.

Meehan wasn't specific on when the committee's bill will be finalized, but said "it's realistic" to have a draft outlined "in a month or two." That draft will then be circulated for feedback to tighten up the language, he said.

One of the other witnesses at the hearing, Mandiant Chief Security Officer Richard Bejtlich, will be testifying at a House Foreign Affairs subcommittee hearing on the threat cyberattacks pose to the country. Chris Painter, coordinator for cyber issues at the State Department, will also be among the witnesses slated to testify.

FCC proposes 911 rules: The Federal Communications Commission proposed rules on Wednesday aimed at ensuring the reliability of 911 services during emergencies.
 
The FCC rules would mandate backup power requirements, require periodic audits of 911 circuits and require network monitoring systems. The regulations are in reaction to widespread 911 outages that resulted from last year's derecho storm.

Cyber bill passes out of House Oversight Committee: The Federal Information Security Amendments Act of 2013 passed out of the House Oversight and Government Reform Committee on Wednesday by a voice vote. The bill focuses on continuous monitoring for cyber threats on federal government computer systems. 

ON TAP 

The House Small Business subpanel on Health and Technology will hold a hearing on Thursday morning that will examine ways to protect small businesses from cyberattacks. Among the witnesses slated to testify are Justin Freeman, corporate counsel for Rackspace, and Phyllis Schneck, chief technology officer for the public sector at McAfee. Freeman will be testifying on behalf of the Application Developers Alliance.

"The recent string of cyber-attacks on high-profile companies is a stark reminder of the current threat. Although small businesses don’t make the headlines, a recent report shows nearly 20 percent of cyber-attacks are on small firms with less than 250 employees," Rep. Chris Collins (R-N.Y.), the subcommittee chairman, plans to say in his opening statement.

"Small businesses generally have fewer resources available to monitor and combat cyber threats, making them easy targets for expert criminals. In addition, many of these firms have a false sense of security and believe they are immune from a possible cyber-attack," Collins is expected to say.

Also on deck, Sen. Marco Rubio (R-Fla.) and Republican FCC Commissioner Ajit Pai will speak at the Free State Foundation’s Telecom Policy Conference.

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Robert McDowell to resign from FCC: Commissioner Robert McDowell, a Republican member of the Federal Communications Commission, said on Wednesday that he will resign from the agency in a few weeks.

"After nearly seven years of carrying out the incredibly high honor of serving the American people at the FCC, it is time to turn more of my energies towards an even higher calling: serving my family," McDowell said.

FCC chief counsel to leave commission: Sherrese Smith, chief counsel and legal adviser to Federal Communications Commission (FCC) Chairman Julius Genachowski, will leave the commission in the coming weeks.

Smith is the last remaining member of the chairman's original team of legal advisers and plays a key role in the chairman's office. She is responsible for managing the commission's overall policy agenda and coordinating between its various bureaus and offices.

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