Pentagon seeks probe of the cost of hacking

washingtontimes.com

The Pentagon is asking the nation’s 16 spy agencies to investigate the cost of theft of commercial secrets by foreign computer hackers, a loss some analysts say could be costing the U.S. economy hundreds of billions of dollars a year.

“We expect it is very substantial — substantial in monetary terms, substantial in security terms,” said James N. Miller, principal deputy undersecretary of defense for policy. “The nation has a substantial interest in protecting intellectual property.”

The Pentagon’s request for an estimate went to the National Intelligence Council, which produces National Intelligence Estimates (NIEs), said Deputy Secretary of Defense William J. Lynn, adding that its report will likely be classified when the assessment is complete.

Security specialists say that hackers, many thought to be operating on behalf of communist China, are stealing vast quantities of proprietary data from U.S. defense, energy and other firms every year, compromising the nation’s security and economic advantage.

“It is a massive transfer of wealth,” said Phyllis Schneck, chief technology officer for public-sector business at computer security firm McAfee Inc.“Things that would have created money and jobs for one company in one country are instead creating them for other companies in another country.”

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Bird Bond: 'Nano Hummingbird' Drone Takes Spying to the Sky

newsfeed.time.com

This drone gives new meaning to "bird watching."

Tech company AeroVironment has announced that the unmanned, “hummingbird–like” aircraft it's been working on since 2006 has achieved its prescribed goals. The Nano Hummingbird, developed for DARPA, the Pentagon's research arm, has both whimsy and espionage potential. Flying via remote control at something like 11 miles per hour, the drone wouldn't be able to keep up with the living and breathing hummingbird. But then, real hummingbirds don't have cameras. Check out the video below. More...

DoD Official Tied to Private Spy Effort

military.com

WASHINGTON --- A Defense Department official is under investigation for hiring private contractors to gather intelligence on suspected insurgents in Afghanistan and Pakistan, The New York Times reported Sunday.

That information was then supplied to military units and intelligence officials, the Times said, citing anonymous military and business sources in the United States and Afghanistan. The scheme violated U.S. policy against using contractors as spies.

Michael D. Furlong was reported to have hired contractors from a private company run by retired Special Forces officers for what some of the Times' sources described as an off-the-books spy operation. Some of the Times' sources said the information gathered by the contractors was used by the military to track down and attack militants.

The officials who spoke to the newspaper said they were not sure who condoned Furlong's operation, and it may have been funded by diverting money from a program intended to merely gather information about the area.

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Caught on Tape: Selling America's Secrets

Watch CBS News Videos Online

(CBS) "60 Minutes" has obtained an FBI videotape showing a Defense Department employee selling secrets to a Chinese spy for cash. The video, which has never been made public before, offers a rare glimpse into the secretive world of espionage and illustrates how China’s spying may now pose the biggest espionage threat to the U.S.

"60 Minutes" correspondent Scott Pelley's report will be broadcast this Sunday, Feb. 28, at 7 p.m. ET/PT.

China may be the number-one espionage threat now. "The Chinese are the biggest problem we have with respect to the level of effort that they’re devoting against us, versus the level of attention we are giving to them," says Michelle Van Cleave, once America’s top counter-intelligence officer who coordinated the hunt for foreign spies from 2003 to 2006.

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Dozens Of Defense Contractors, Agencies Hacked

forbes.com

As cyberspies multiply and evolve, the military says many defense firms remain woefully insecure.

For anyone who has a security clearance and doesn't believe the U.S. faces a cyber-espionage crisis, Colonel Steven Shirley has 102 stories to share with you.

That's the number of cases in which Shirley's team of Pentagon researchers discovered cyberspies breaching the networks of government agencies, defense contractors and other organizations with ties to the U.S. Department of Defense, gaining administrator-level access with the aim of stealing military secrets. The Pentagon's forensics-focused Cyber Crime Center, where Shirley is executive director, found that between August 2007 and August 2009, 71 government agencies, contractors, universities and think tanks with connections to the U.S. military had been penetrated by foreign hackers, in some cases multiple times. In total, Shirley told Forbes, the center performed 116 investigations following spying breaches and found that in all but 14 of those cases the intruders had gained complete administrator-level access to the victim's network.

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