March 2001 Volume 1
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In
the past six weeks, employees in federal
office buildings located throughout the
United States have reported suspicious activities
connected with individuals representing
themselves as foreign students selling or
delivering artwork. Employees have observed
both males and females attempting to bypass
facility security and enter federal buildings.
If challenged, the individuals
state that they are delivering artwork from
a studio in Miami, Florida, called Universal
Art, Inc, or that they are art students
and are looking for opinions regarding their
work. These individuals have been described
as aggressive. They attempt to engage employees
in conversation rather than giving a sales
pitch.
Federal police officers have
arrested two of these individuals for trespassing
and discovered that the suspects possessed
counterfeit work visas and green cards.
These individuals have also gone to the
private residences of senior federal officials
under the guise of selling art.
Other reporting indicates
that there may be two groups involved, and
they refer to themselves as "Israeli
art students." One group has an apparently
legitimate money- making goal while the
second, perhaps a non-Israeli group, may
have ties to a Middle Eastern Islamic fundamentalist
group.
Federal employees observing any activity
similar to that described above should report
their observations to appropriate security
officials.
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The
Seoul media reported that South Korea's
Small and Medium Business Administration
will begin screening applicants in March
for admission to a newly established Korea
Venture Center (KVC) in Fairfax County,
Virginia, near Washington, DC. According
to the February 8 Chonja Sinmun (a daily
newspaper servicing the electronics industry
and the science and technology community
in general), 10 of the 35 South Korean venture
companies that applied for entry into the
US-based high-tech "incubator"
will be selected to receive support at the
center. This support reportedly includes
subsidized rent and guidance in finding
local firms for technical cooperation.
The KVC is the first such South Korean
center in the eastern United States. Its
formation was announced by South Korea's
Ministry of Commerce, Industry, and Energy
(MOCIE) as part of that country's effort
to promote "strategic cooperation"
with US firms in high-tech corridors of
the United States, according to the October
20, 2000 Chonja Sinmun. At its formal opening
in late November, KVC Director U Chong-sik
reiterated that the center's goal is to
assist Korean companies in arranging joint
R&D with foreign institutions, according
to the November 21 Hanguk Kyongje Sinmun
(a daily business newspaper).
The newspaper noted that the KVC is South
Korea's third information technology (IT)
incubator in the United States; the other
two being the Overseas Software Support
Center (KSI) and the Information and Communications
Venture Support Center (I-park) in Silicon
Valley, both under the Ministry of Information
and Communication (MIC). On December 21,
2000 Chonja Sinmun went on to report that
the 14 companies at KSI were to relocate
to I-park at year's end, in connection with
a merger of the two facilities that was
driven by the need to directly support their
clients' interaction with local high-tech
firms.
Earlier press reporting on I-park also
pointed out its technology transfer function.
On May 29, 2000 Maeil Kyongje Sinmun (a
business-oriented newspaper) reported that
I-park would facilitate strategic cooperation
with local US companies, a phrase used in
the Korean press to describe programs aimed
at acquiring foreign technology. Hanguk
Ilbo (a widely read daily newspaper) stated
on September 3, 2000 that I-park serves
as a base of operations for a network of
ethnic Korean IT specialists in Silicon
Valley, which suggests that the South Korean
venture companies are encouraged to pursue
technical ties with émigré
IT companies already operating in the valley.
I-park's role as a technology transfer
installation is stated on its Web site (www.ipark-iita.com),
which lists facilitating technology exchanges
as a main function. The site acknowledges
support from the Institute of Information
Technology Assessment (IITA), whose primary
Web site (www.iita.re.kr)
identifies technology transfer as one of
its main projects. The IITA was founded
in 1992 as an affiliate of the Electronics
and Telecommunications Research Institute
(ETRI, now part of MIC), South Korea's state-run
telecommunications research facility chartered
to disseminate innovative technology to
Korean manufacturers (www.etri.re.kr).
The link between tech transfer and the
KVC/I-park operations is further underscored
by IITA's association since October 1999
with Seoul's IT Technology Transfer Center,
also referred to as a cyber technomart,
which is designed to facilitate the early
acquisition of state-of-the-art technology
and its commercialization by South Korean
manufacturers, according to the center's
Web site (www.technomart.re.kr).
I-park itself is referred to in some Seoul
press reports, for example the October 7,
2000 Hanguk Kyongje Sinmun) and in IITA's
"History" pages (ita.iita.re.kr/~ita)
as the Overseas IT technology cooperation
center.
In a related event, the December 7 2000
Naewoe Kyongje Sinmun (a Seoul business
newspaper) reported MOCIE's plan to establish
a similar Japan IT venture center in Tokyo
at the end of February to support South
Korean venture firms' strategic cooperation
with high-tech Japanese telecommunications
companies. The new center, based on a Korea-Japan
IT cooperation initiative signed last September,
reportedly will maintain contact with the
KVC in Fairfax County.
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On
Sunday, February 18, Robert Philip Hanssen,
a veteran Federal Bureau Investigation (FBI)
counterintelligence agent, was arrested
by the FBI and charged with committing espionage
by providing highly classified national
security information to Russia and the former
Soviet Union.
The 100-page affidavit and other official
commentary on the arrest may be viewed at
the FBI Web site at www.fbi.gov.
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Two
companies that make and bottle Coca-Cola
in Brazil are under government investigation
after rival Pepsi accused them of industrial
espionage. There was no comment from either
of the companies, Recofarma Industria do
Amazonas and Spal Industria de Refrescos,
but Brazilian officials confirmed they were
looking into the allegations.
Recofarma, based in the Amazonas state
capital of Manaus, produces the Coca-Cola
concentrate for Brazil, Coke's third largest
market worldwide. Spal bottles the soft
drink in Brazil's richest state, Sao Paulo.
Pepsi's allegations were based on claims
by a former
Coca-Cola executive who claimed he was fired
in 1997 after taking part in an alleged
espionage plot by Coca-Cola to curb an ambitious
1994 marketing and distribution strategy
by Buenos Aires Embotelladora, or Baesa,
Pepsi's bottler and distributor in Brazil.
He is suing for $150,000 compensation. The
official reportedly claimed to have helped
transcribe four tapes that contained secretly
recorded conversations of top Baesa officials
discussing sales strategy.
Pepsi and Coca-Cola compete for a $1.5
billion soft-drink market in Brazil. Yearly
4 billion liters of soda are sold in the
country.
How bitter is this soda rivalry? Consider
this. The National Hockey League's (NHL)
All-Star game was played on February 4,
2001 at the Pepsi Center in Denver, Colorado,
home of the NHL's Colorado Avalanche. Because
Coca-Cola is the official sponsor of the
NHL, Coke forced the Avalanche to omit the
formal name of its arena from the all-star
tickets. League officials supported the
action, describing the location of the game
in the most generic terms, as "the
home of the Colorado Avalanche." In
case you missed it, the North American All-Stars
powered past the World All-Stars by a score
of 14 to 12.
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According
to the Associated Press, on February 8,
2000 the US Navy offered to drop espionage
charges against the Navy cryptologist who
has been accused of spying for the Russians.
However, Petty Officer First Class Daniel
King's attorney rejected the offer, saying
that it contained details unfavorable to
his client.
Petty Officer King has been held in the
military brig at Quantico, Virginia, for
over 500 days since he was arrested in October
1999 after allegedly failing a routine lie
detector test. According to one source,
the Navy would rather cut its losses and
gain King's cooperation to determine the
extent of damage to national security rather
than risk losing at trial.
The offer to drop charges
comes after months of setbacks to the Navy's
case that included defense accusations of
security violations by the prosecutors and
the investigating officer and a military
appeals court twice ruling in the defense's
favor, once ordering that prosecutors restart
the case.
The case against King began
in September 2000 with an Article 32 hearing,
akin to a pretrial hearing to determine
charges. Since then, the case has encountered
several roadblocks and major delays.
In October, the Navy-Marine
Court of Appeals chastised Navy prosecutors
for delaying the proceeding for months by
requiring that a monitoring agent be present
at all meetings between King and his attorneys.
The court deemed the Navy's actions unconstitutional
and overturned the requirement.
In November, prosecutors lost
a major witness when it was determined that
he had been assigned to listen to private
conversations between King and his attorneys
for discussion of classified material.
Then in December, the court
ruled in King's favor, ordering the prosecutors
to restart the hearing after it found that
the prosecutors and the presiding officer
violated King's right to a public trial.
Additional background on the
King case may be founded in the December
2000 edition of the Counterintelligence
News and Developments (CIND) newsletter.
On
March 9, 2001, the US Navy dropped all espionage
charges against Navy Petty Officer First
Class Daniel King. The officer overseeing
the Navy's prosecution of the sailor stated
in a letter that because of King's mental
state during questioning, and the lack of
corroborating evidence, he doubted the validity
of King's confession. Another Navy source
said the Navy was forced to drop espionage
charges and two lesser charges because of
the difficulty in protecting national security
while upholding King's right to a public
trial.
Petty Officer King was released
from custody in Quantico, Virginia on March
9.
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According
to information supplied by the National
Aeronautics and Space Administration, Ehud
Tenenbaum, the Israeli hacker known as "The
Analyzer," pleaded guilty in Israel
to the 1998 attacks on unclassified US Defense
Department computer systems. These hacking
attacks touched off alarms at the highest
levels of the US Government.
In an appearance late last
year before a magistrate in a suburb east
of Tel Aviv, the 21-year-old admitted to
hacking into US and Israeli computers. He
pleaded guilty to conspiracy, wrongful infiltration
of computerized material, disruption of
computer use, and destroying evidence. Sentencing
is set for March 13, when prosecutors hope
to lock up the hacker for at least six months-the
minimum sentence that would make him ineligible
for house arrest.
Documented in the National
Counterintelligence Center (NACIC) videotape
"Solar
Sunrise: Dawn of a New Threat,"
the Tenenbaum case began in February 1998,
when dozens of Pentagon systems were suffering
what then-US Deputy Secretary of Defense
John J. Hamre called "the most organized
and systematic attack to date" on US
military computer systems. Although the
attacks exploited a well-known vulnerability
in the Solaris operating system for which
a patch had been available for months, they
came at a time of heightened tension in
the Persian Gulf. Dr. Hamre and other top
officials became convinced that they were
witnessing a sophisticated state-sponsored
Iraqi effort to disrupt troop deployment
in the Middle East. As the result of the
computer attacks, a joint US task force
was formed, and the investigation, code-named
Solar Sunrise, eventually snared
two California teenagers and Tenebaum.
Today, defense officials continue
to point to Solar Sunrise as illustrative
of the difficulty of separating recreational
hacking attacks from the state-sponsored
cyber assaults that they are still certain
are on the horizon. Law enforcement, meanwhile,
holds this investigation up as a textbook
example of interagency cybercrime cooperation.
The California teens received
probation, and, after a brief stint in the
military, Tenenbaum was indicted under Israeli
computer crime laws in February 1999. The
case dragged on in the courts until the
plea agreement.
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The
December 2000 edition of the CIND reported
that Timothy Steven Smith, a Department
of Defense civilian employee who stole classified
military documents from the USNS Kilauea
in Bremerton, Washington, pleaded guilty
to reduced charges of stealing government
property and assaulting a federal officer.
The Naval Criminal Investigative
Service Field Office in Puget Sound, Washington,
reports that Smith was sentenced to 260
days confinement (time served) and released
on December 22, 2000.
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The
National Intelligence Council (NIC), a 15-member
group based at Central Intelligence Agency
headquarters under the Director of Central
Intelligence, has released a 68-page document,
Global Trends 2015: A Dialogue about the
Future with Nongovernmental Experts. The
document is an attempt by the US Intelligence
Community to look beyond its secret sources
and involve academia and the private sector
in forecasting world trends over the next
decade and a half.
The report notes that the risk of a missile
attack against the United States involving
chemical, biological, or nuclear weapons
is greater today than during most of the
Cold War and will continue to grow in the
next 15 years. It also concludes that terrorist
attacks against the United States through
2015 will increase with the intent to inflict
mass casualties.
The complete report may be viewed on the
Internet at www.cia.gov/cia/publications/globaltrends2015/index.html.
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The
National Counterintelligence Center (NACIC)
has created an Internet address group to
alert and inform our readers about new and
updated information posted on the NACIC
Web site--www.ncix.gov.
The advisories include information on NACIC
regional seminars, the release of new
awareness material, and other new items
of counterintelligence interest. Nearly
900 subscribers, from both the private sector
and the US Government, are already taking
advantage of this service. Advisories are
transmitted in a blind carbon copy format.
If you would like to be included
as a recipient of these advisories, send
an e-mail request to stephfa0@ucia.gov,
and we will add your name to the list.
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