Hillicon Valley: Net neutrality ends | What repeal means and what's next | Treasury sanctions Russian firms for aiding cyberattacks | How trolling became diplomacy's new trend | Feds crack down on email scams | Defense bill cyber update

Hillicon Valley: Net neutrality ends | What repeal means and what's next | Treasury sanctions Russian firms for aiding cyberattacks | How trolling became diplomacy's new trend | Feds crack down on email scams | Defense bill cyber update
© Greg Nash

The Cyber and Tech overnights have joined forces to give you Hillicon Valley, The Hill's new comprehensive newsletter detailing all you need to know about the tech and cyber news from Capitol Hill to Silicon Valley.

Welcome! Follow the cyber team, Morgan Chalfant (@mchalfant16) and Olivia Beavers (@olivia_beavers), and the tech team, Ali Breland (@alibreland) and Harper Neidig (@hneidig), on Twitter. Send us your scoops, tips and compliments.

 

NET NEUTRALITY NO MORE: The Federal Communications Commission's decision to repeal its 2015 net neutrality rules went into effect today, ending the landmark regulations that placed clear limits on how internet service providers could handle web traffic.

Companies like Comcast and Verizon will no longer be prohibited from blocking or throttling web traffic, or from creating paid internet "fast lanes."

Senate Minority Leader Charles SchumerCharles (Chuck) Ellis SchumerThis week: GOP mulls vote on ‘abolish ICE’ legislation Red-state Dem tells Schumer to 'kiss my you know what' on Supreme Court vote Dem infighting erupts over Supreme Court pick MORE (D-N.Y.) laid the blame on the shoulders of Hill Republicans for getting in the way of a bill that would save the rules from repeal.

"By refusing to bring up the Senate-passed resolution to restore net neutrality, which passed the Senate by a powerful bipartisan vote, House Republican leaders gave a green light to the big ISPs to charge middle-class Americans, small business owners, schools, rural Americans, and communities of color more to use the internet," Schumer said in a statement.

The bill passed the Senate last month with the help of three Republican votes but is unlikely to get through the House.

FCC Chairman Ajit Pai, a Republican who spearheaded the repeal, wrote in an op-ed for CNET today that consumers will still be protected under the new regime and that the Federal Trade Commission will be empowered to go after ISPs who abuse their power.

What now? Internet users likely won't notice any changes in the immediate aftermath of the repeal. Broadband providers have promised not to take any steps to hurt the open internet and they're likely to be on their best behavior while both sides take the fight to court. We've got more on what the repeal means here and why the stakes are still so high.

What's next? A coalition of Democratic attorneys general and consumer advocates have sued the FCC over the repeal, so ultimately a federal judge will have final say over the fate of the rules. In the meantime, states are taking it upon themselves to fill the void by passing their own laws codifying the net neutrality rules, potentially laying the groundwork for a separate legal battle. And Democrats are still waging an uphill battle to get their bill to the floor of the House.

 

TREASURY SANCTIONS RUSSIAN FIRMS FOR AIDING CYBERATTACKS: The Trump administration on Monday announced sanctions against five Russian entities and three Russian nationals for aiding the Kremlin's domestic security service.

The Treasury Department targeted five companies and technology firms as well as three executives from one of the companies, all of whom are accused of aiding Russia's Federal Security Service (FSB). The sanctioned targets are banned from the U.S. financial system and American citizens and business are prohibited from any transactions with them.

The penalties were issued under the Russian sanctions law Congress passed last year and a 2015 executive order targeting cybercrime. The Treasury Department targeted FSB with sanctions in March for its involvement in several Kremlin-led cyber attacks.

The FSB was also one of several entities sanctioned by former President Barack ObamaBarack Hussein ObamaWhy did it take so long for Trump to drain the swamp of Pruitt? President Trump is tougher on Russia in 18 months than Obama in eight years Obama in Kenya for launch of sister’s sports center MORE in December 2016 in relation to Russian hacking of Democratic political organizations and operatives during the presidential campaign that year.

Treasury Secretary Steven MnuchinSteven Terner MnuchinIRS reduces donor reporting rules for some tax-exempt groups On The Money: US files complaints at WTO | House leaders get deal to boost biz investment | Mnuchin says US will consider Iran sanctions waivers | FCC deals blow to Sinclair-Tribune merger Mnuchin says US will consider Iran oil sanctions waivers: report MORE said in a statement that the targets of the new sanctions helped FSB improve its cyber and underwater operations and "jeopardize the safety and security of the United States and our allies."

Mnuchin said the U.S. is committed to "aggressively targeting" anyone aiding the FSB, saying the U.S. would do so under the 2017 sanctions law, known as the Countering America's Adversaries Through Sanctions Act (CAATSA).

The targets: OFAC slapped sanctions on a firm called Digital Security and two subsidiaries for their work on an unspecified project "that would increase Russia's offensive cyber capabilities" for agencies including FSB, the Treasury Department said.

The sanctions also cover Kvant Scientific Research Institute, which the FSB controls, and Divetechnoservices, which has supplied FSB with "a variety of underwater equipment and diving systems for Russian government agencies" including a $1.5-million submersible craft, according to the Trump administration.

Three top Divetechnoservices executives--Aleksandr Lvovich Tribun, Oleg Sergeyevich Chirikov and Vladimir Yakovlevich Kaganskiy--were also targeted by OFAC on Monday. We've got the details on the sanctions here.

 

FEDS CRACK DOWN ON WIRE FRAUD SCHEME: Federal authorities have arrested dozens of people for allegedly hijacking or intercepting wire transfers through sophisticated email scams, the Department of Justice (DOJ) announced Monday.

Law enforcement officials arrested 74 people for allegedly carrying out business email compromise (BEC) schemes, or "cyber-enabled financial fraud" as part of Operation Wire Wire, according to a DOJ press release.

Hackers execute BEC scams by impersonating employees or business executives after gaining access to their email accounts. These types of attacks use social engineering tactics to trick unsuspecting employees and business executives into making wire transfers to bank accounts that are controlled by the criminals. The elderly are particularly targeted in BEC schemes.

The Justice Department coordinated with the Department of Homeland Security (DHS), the Treasury Department and the U.S. Postal Inspection Service to track the suspected cyber crooks, which ultimately resulted in the arrest of 42 alleged fraudsters in the United States and 29 in Nigeria.

Law enforcement also seized nearly $2.4 million as part of the operation, and recovered approximately $14 million in fraudulent wire transfers by disrupting the BEC schemes, the DOJ said.

Click here to read more.

 

TROLLING DIPLOMACY? When Iran's supreme leader tweeted criticism of Israel last Sunday, Israel's Embassy in the United States fired back with an image from the movie "Mean Girls" to poke fun at Ayatollah Ali Khamenei.

While dismissed as internet trolling, experts say the embassy snark is part of a pattern of internet diplomacy increasingly used around the world amid a resurgence of populist rhetoric.

Governments seeking to please their most vocal political bases domestically are becoming cavalier with how they communicate with countries abroad -- at least online.

In 2013, as Iran's new president Hassan Rouhani was publicly signaling a willingness to negotiate a nuclear deal, the Israeli Embassy tweeted a link to a parody LinkedIn account it made for Rouhani.

The profile described the Iranian president as an "Expert Salesman, PR Professional and Nuclear Proliferation Advocate," and listed professional skills like "Weapons of Mass Destruction," "Ballistics" and "Military Justice."

Iran has sought to fight fire with fire -- or trolling with trolling, in this case.

In one of the more memorable examples, Khamenei took to Instagram after President TrumpDonald John TrumpShocking summit with Putin caps off Trump’s turbulent Europe trip GOP lambasts Trump over performance in Helsinki Trump stuns the world at Putin summit MORE scrapped the U.S. nuclear deal with Iran to show a picture of himself reading "Fire and Fury: Inside the Trump White House," a controversial book that detailed the extreme dysfunction of Trump's White House.

"It's the populist regimes which tend to be doing this," said Ben Nimmo, a researcher at the Atlantic Council's Digital Forensic Research Lab, the international affairs think tank's digitally focused arm.  

We've got more here.

 

DEFENSE BILL WATCH: The Senate is voting Monday evening on beginning debating the annual defense policy legislation known as the National Defense Authorization Act (NDAA).

Lawmakers have offered dozens of amendments to the fiscal 2019 bill, including a number that are cyber-related. One from Sens. James LankfordJames Paul LankfordJuan Williams: Putin wins as GOP spins Senators seek data on tax law's impact on charitable giving GOP senators introduce resolution endorsing ICE MORE (R-Okla.) and Amy KlobucharAmy Jean KlobucharBooker seizes on Kavanaugh confirmation fight Democrats build abortion case against Kavanaugh  The animating forces behind the Democratic Party are true, radical leftists MORE (D-Minn.) is aimed at securing U.S. elections from cyberattacks, as we reported last week. Another from Sen. Martin HeinrichMartin Trevor HeinrichCNN congressional correspondent talks about her early love of trolls and family Overnight Energy: DNC to reject fossil fuel donations | Regulators see no security risk in coal plant closures | Senate committee rejects Trump EPA, Interior budgets Energy commission sees no national security risk from coal plant closures MORE (D-N.M.) would force President Trump to appoint a cybersecurity coordinator at the White House after the administration's controversial decision to eliminate the role.

Another from Sen. Mark WarnerMark Robert WarnerSenate Dems rip Trump after Putin news conference Trump and Putin should be talking about cyber weapons and social media instead of nuclear weapons The Hill's Morning Report — Trump, Putin meet under cloud of Mueller’s Russia indictments MORE (D-Va.), the top Democrat on the Senate Intelligence Committee, would amend the cyber policy provision in the bill to name cyberattacks that impact "the integrity or outcome of United States elections at any level" as among those that warrant a U.S. response – a clear reference to Russian interference in the 2016 vote. And Sen. Tom CottonThomas (Tom) Bryant CottonOvernight Defense: Fallout from tense NATO summit | Senators push to block ZTE deal in defense bill | Blackwater founder makes new pitch for mercenaries to run Afghan war Hillicon Valley: DOJ appeals AT&T-Time Warner ruling | FBI agent testifies in heated hearing | Uproar after FCC changes rules on consumer complaints | Broadcom makes bid for another US company | Facebook under fire over conspiracy sites Hillicon Valley: Justice Department appeals AT&T-Time Warner ruling | New report on election security | FBI agent testifies in marathon hearing MORE (R-Ark.), Sen. Chris Van HollenChristopher (Chris) Van HollenSenate Dems rip Trump after Putin news conference Overnight Defense: Fallout from tense NATO summit | Senators push to block ZTE deal in defense bill | Blackwater founder makes new pitch for mercenaries to run Afghan war Hillicon Valley: DOJ appeals AT&T-Time Warner ruling | FBI agent testifies in heated hearing | Uproar after FCC changes rules on consumer complaints | Broadcom makes bid for another US company | Facebook under fire over conspiracy sites MORE (D-Md.) and Senate Minority Leader Charles Schumer (D-N.Y.) have introduced an amendment that would restore the Commerce Department's penalties on ZTE for violating U.S. sanctions against Iran and North Korea. It is unclear which amendments, if any, will get a vote.

Keep up with our colleagues over in Defense for full coverage of the NDAA.

 

JUST BREAKING: The Senate Commerce Committee has just posted a trove of written responses from Facebook after the committee's initial April hearing with CEO Mark ZuckerbergMark Elliot ZuckerbergViolence in Myanmar poses major test for Facebook US, EU must work together in wake of Facebook data breach Hillicon Valley: Lawmakers press Apple, Google on data collection | 21M affected by Timehop breach | Zuckerberg passes Buffett on rich list | Latest on Twitter's bot crackdown MORE that was triggered by the Cambridge Analytica controversy. "We'll be examining the responses as we continue to probe FB's data collection and efforts to protect online privacy," Chairman John ThuneJohn Randolph ThuneGOP senators introduce resolution endorsing ICE The real reason Scott Pruitt is gone: Putting a key voting bloc at risk Hillicon Valley: Lawmakers eye ban on Chinese surveillance cameras | DOJ walks back link between fraud case, OPM breach | GOP senators question Google on Gmail data | FCC under pressure to delay Sinclair merger review MORE (R-S.D.) wrote on Twitter. The responses are posted here, and you can keep up with our coverage of them here.

 

A LIGHTER TWITTER CLICK: Ummm … what the B?

 

LONG READ OF THE DAY: The The New York Times profiles how police in Newark have opened up surveillance feeds to regular citizens to help fight crime and boost transparency.

 

ON TAP FOR TOMORROW:

The Senate Judiciary Committee is holding a hearing at 10 a.m. on law enforcement efforts to prevent election interference that will feature testimony from a Homeland Security official working on securing election infrastructure from digital threats.

For all you hockey fans, the Washington Capitals' victory parade will take place tomorrow beginning at 11 a.m. Here's what you need to know, from WTOP.

At 4 p.m. Judge Richard Leon is expected to decide the fate of the $85 billion AT&T-Time Warner merger.

 

NOTABLE LINKS FROM AROUND THE WEB:

John Bolton's new aide previously cast doubt on the intelligence community's conclusion about Russian election interference. (The Daily Beast)

Uber has patented a system that will be able to tell when passengers are drunk. (The Telegraph)

Bitcoin price declines after cyberattack on South Korean cryptocurrency exchange. (UPI)

The Marines want older members to sign on to the service's cyber force. (Associated Press)

Cyber startup Claroty raises $60 million in Series B funding. (Reuters)

CTIA, a group that lobbies on behalf of wireless telecom companies, led a coalition of lobbying groups in support of the Senate's new Airwaves Act, which would make more spectrum available for broadband.