Chicago Sun-Times

Russians charged in Yahoo hacks

Two intel officers among four suspects who face 47 criminal counts

- Kevin Johnson and Jessica Guynn

Four people, including two Russian intelligen­ce officers, have been charged in a Yahoo hacking attack that compromise­d the personal informatio­n of hundreds of millions of consumers, the Justice Department said Wednesday.

Federal prosecutor­s alleged the suspects hacked into Yahoo systems to “steal informatio­n from about 500 million accounts and then used some of that stolen informatio­n to obtain unauthoriz­ed access to the contents of accounts at Yahoo, Google and other webmail providers.”

The four men face 47 criminal charges including computer fraud and economic espionage. This marks the first time the U. S. government has issued criminal charges against Russian officials for cyberattac­ks.

“The indictment unequivoca­lly shows the attacks on Yahoo were state- sponsored,” Chris Madsen, Yahoo’s assistant general counsel and head of global law enforcemen­t, said in a statement.

Yahoo said when it revealed the security breach in September that it believed the attack was state- sponsored. It disclosed a second security breach in December that was larger than the first, affecting approximat­ely 1 billion Yahoo accounts. That breach has not been connected to the first.

The two officers of Russia’s Federal Security Service, known as the FSB, Dmitry Dokuchaev and Igor Sushchin, allegedly paid hackers to break into Yahoo’s systems as part of an intelligen­ce collection operation and for- profit scheme to “line the pockets” of all involved, federal prosecutor­s alleged.

“The defendants targeted Yahoo accounts of Russian and U. S. government officials, including cyber security, diplo- matic and military personnel,’’ Assistant Attorney General Mary McCord said at a Justice Department briefing in Washington. “They also targeted Russian journalist­s ... employees of financial services and other commercial entities.”

McCord said the FSB agents worked with hackers Alexsey Belan and Karim Baratov to breach the computers of American companies that provide email and Internet- related services and to “steal informatio­n, including informatio­n about individual users and the private contents of their accounts.”

Belan, indicted twice before in the U. S. for hacking into e- commerce sites as part of intrusions that victimized millions, has been listed as one of the FBI’s most- wanted cyber criminals for three years.

“Belan’s notorious criminal conduct and a pending Interpol Red Notice ( a global arrest warrant) did not stop the FSB officers who, instead of detaining him, used him to break into Yahoo networks,’’ McCord said.

The four suspects are charged with computer hacking, economic espionage and other criminal offenses. All but one, Karim Beratov, remain at large. Beratov was arrested Tuesday in Canada by Toronto police, and authoritie­s are expected to seek his extraditio­n to the U. S. There is no extraditio­n agreement between the U. S. and Russia, making the U. S. prosecutio­n of at least the two FSB officers extremely doubtful.

U. S. officials described the collaborat­ion of the Russian government officials with criminal hackers as an increasing­ly alarming criminal model aimed at compromisi­ng individual privacy, economic and security interests.

Most troubling, McCord said, was that the two Russian FSB officials worked for the Russian intelligen­ce unit known as the Center for Informatio­n Security or “Center 18,” which is the primary point of contact for the FBI in Moscow.

FBI Executive Assistant Director Paul Abbate said Wednesday that the involvemen­t of Russian officials from Center 18 now represents “a great test” of future U. S.- Russian law enforcemen­t cooperatio­n.

McCord said investigat­ors had observed no connection between the Yahoo hacks and Russia’s intrusion into the U. S. political system, including the Democratic National Committee.

Absent the prosecutio­n of the Russian officials, McCord said all other punitive options were being considered, including government sanctions.

“We definitely will engage in those discussion­s,” McCord said.

The indictment largely was symbolic but still significan­t because, in part, it underscore­d “the very cozy relationsh­ip between Russian state security apparatus and for- hire Russian hackers,” Robert Cattanach, of law firm Dorsey & Whitney, said.

Yahoo, which is selling its core Internet business to Verizon, has paid a heavy cost for the security breaches. Verizon negotiated a price discount, trimming $ 350 million from the acquisitio­n of Yahoo for a total of $ 4.48 billion. And the two companies will share some legal and regulatory liabilitie­s arising from the breaches. The acquisitio­n is expected to close in the second quarter.

Yahoo CEO Marissa Mayer agreed to forgo any annual equity award she might get for 2017 because of the breach her company suffered in 2014. The Yahoo board also voted to withhold her 2016 annual bonus for the same reason. Under her contract, her equity award is not to be less than $ 12 million per year. In December, the Securities and Exchange Commission opened a formal probe into the company’s handling of the attacks, investigat­ing whether Yahoo should have notified investors sooner about both security breaches.

Mayer tweeted her appreciati­on to federal law enforcemen­t authoritie­s on Wednesday.

“Very grateful to the FBI & DOJ for bringing to justice the Russian officials & hackers who led the attack on Yahoo.”

“( Hacker Alexsey) Belan’s criminal conduct ... did not stop the FSB officers who used him to break into Yahoo networks.” Mary McCord, acting assistant attorney general

 ?? SUSAN WALSH, AP ?? Acting Assistant Attorney General Mary McCord, accompanie­d by U. S. Attorney for the Northern District Brian Stretch, speak about the security breach at Yahoo.
SUSAN WALSH, AP Acting Assistant Attorney General Mary McCord, accompanie­d by U. S. Attorney for the Northern District Brian Stretch, speak about the security breach at Yahoo.

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