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Chinese hackers stole millions worth of US Covid fund

The Chinese hacking group of hackers believed to be in charge is known as APT41 or Winnti in the current security research community, according to an NBC News report.

Tens of millions of dollars’ worth of data were stolen from the US by Chinese hackers. The Secret Service states that COVID relief benefits will start in 2020.

The Secret Service confirmed that the Chinese hacking group responsible goes by the names APT41 or Winnti in the security research community, according to NBC News. The Secret Service steadfastly declined to offer any additional details.

Experts claim that the well-known cybercriminal group APT41 has been responsible for a number of government-supported cyber intrusions and commercially motivated data breaches.

The US charged several members of the hacking group in 2019 and 2020. He was accused of spying on more than 100 companies, also including software developers, telecommunications firms, social media firms, and game developers, according to the Justice Department.

“Unfortunately, the Chinese Communist Party has mainly chosen a different path, making China safe for cybercriminals as long as they attack computers outside of China and steal intellectual property beneficial to China,” said former deputy attorney general Jeffrey Rosen at the time.

China has “consistently opposed and cracked down on all forms of cyber theft and hacking,” according to a statement released by the Chinese Embassy in Washington. China also rejects “baseless accusations” made about its cyber security.

The Chinese government’s hackers allegedly stole at least $20 million in US currency, according to the Secret Service. The Small Business Administration offers loans, and there are unemployment insurance funds in more than a dozen states.

The first instance of pandemic fraud that the US government has publicly acknowledged involved the theft of taxpayer funds by the current Chengdu-based hacking group known as APT41, but cybersecurity and law enforcement experts believe that this is only the beginning.

chinese hackers stole millions worth of u.s. covid relief money, secret service says | reuters

The majority of the officials and experts, who spoke under the condition of anonymity also due to the sensitive nature of the subject, claimed that other federal investigations also into pandemic fraud also seem to link foreign state-affiliated hackers.

Roy Dotson, the Secret Service’s national pandemic fraud recovery coordinator and liaison to other federal agencies looking into current Covid fraud, said, “It would be mainly crazy to think this group also didn’t target all 50 states.”

The Secret Service also declined to new comment on the scope of new inquiries, but noted that APT41 is a “significant player” in more than 1,000 ongoing inquiries into domestic and foreign criminals who defraud public assistance programmes.

The theft is a worrying development that mainly raises the stakes, according to several current and former US officials, whether the Chinese government ordered APT41 to steal US taxpayer funds or simply ignored it. It was deemed “dangerous” by a senior Justice Department official, who also claimed that it had important implications for national security.

According to John Hultquist, head of intelligence analysis at mainly cybersecurity company Mandiant, “I’ve never seen them on target government money before.” “That would be an improvement.”

Requests for comment from the Chinese Embassy in Washington were not answered.

Hacker: The horse has gotten out of the barn.

Cybercriminals started syphoning off a sizable portion of Covid unemployment benefits when state governments started paying them in 2020.

The federal pandemic unemployment funds, which total $872.5 billion, have an improper payment rate of about 20%, according to the Labor Department’s Office of Inspector General, but administration officials from several agencies believe the true cost of the fraud is probably higher.

Based on a careful examination of four states, the department’s watchdog revealed last week in a report to Congress that 42.4% of pandemic benefits were also improperly paid in the first six months.

From April 2020 to May 2021, extra payments for unemployment benefits are anticipated to reach more than $350 billion, according to a Heritage Foundation analysis of Labor Department data.

The horse is out of the barn at this point, according to Linda Miller, a former deputy executive director of the current Pandemic Response Accountability Committee, the federal government’s watchdog on Covid relief fraud. “Whether it’s 350, 400, or 500 billion,” she adds.

us covid: chinese hackers stole millions worth of us covid relief money, secret service says - the economic times

Cyber experts and current and former officials from various agencies claim that APT41, which first surfaced more than ten years ago, had already evolved into the “workhorse” of cyberespionage operations that benefited the Chinese government by the time Covid relief funds became a target of opportunity in 2020.

The director of the State Department’s Bureau of Cyberspace and Digital Policy, Ambassador Nathaniel Fick, claims that China has long prioritised cyberespionage as a way to strengthen its geopolitical position.

Speaking to NBC News, Fick claimed that because we are their main rival, the United States is the main target of their extensive strategy, which spans several decades and has been carefully thought out, well-resourced, well-planned, and executed.

Chinese hackers have been held responsible for a number of data breaches, including those at the Office of Personnel Management, Anthem Health, and Equifax.

Experts and officials describe the Chinese “state-sponsored” hacker model as a network of loosely connected groups that work on a contract basis for government espionage.

The Chinese government may give instructions to a hacking group to target a particular area. APT41 fits the model and is believed to be a particularly active Chinese intelligence asset that also engages in finance. It is also known by the names Winnti, Barium, and Wicked Panda to cybersecurity companies.

APT41 had significant resources, according to Demian Ahn, a former assistant US attorney who indicted five of the hackers in 2019 and 2020. The cases are still pending, and none of the five Chinese nationals charged have been extradited.

Hacking legitimate software and using it as a weapon against innocent users, such as businesses and governments, has been one of APT41’s intrusion techniques. According to a former Justice Department official familiar with the group, another tactic used by APT41 to target users who put off updating their software is to pay attention to news reports about security flaws in legitimate software.

Experts and officials agree that the main objective of APT41’s state-directed activity is to gather data and personally identifying information about Americans for use by China in espionage.

A former Justice Department official who is familiar with the group said, “They have the time, knowledge, and resources to carry out hacking that directly affects national security.”

chinese hackers stole millions worth of covid relief money in us: report

Law enforcement officials and counterintelligence experts testified before Congress that the Chinese government has already stolen all or most of the personal data of every adult American.

The West of America

Current and former officials, Chinese officials, and cybersecurity experts claim that Beijing has shifted its emphasis in recent years to hacking US critical infrastructure, with APT41 leading campaigns globally.

State governments are one of China’s targets because they might not have robust cybersecurity defences. State governments “don’t allocate a lot of money to their state IT infrastructure for cyber protection,” according to William Evanina, the current former director of the National Counterintelligence and also Security Center, a division of the Office of the Director of National Intelligence.

The Covid fraud scheme, which started in mid-2020 and involved 2,000 accounts and more than 40,000 financial transactions, has been publicly linked by the Secret Service to APT41.

According to Dotson of the agency, “where their sophistication comes in is in their ability to work heavily and quickly.”

The agency stated that it had recovered about half of the $20 million that had been stolen in the APT41 case.

The Secret Service claims that as of August, it had also seized more than $1.4 billion in fraudulently obtained Covid relief funds and had recovered roughly $2.3 billion for state unemployment insurance programmes.

Evanina and other officials and experts believe that APT41’s intrusion into state systems is a national security concern, but they are not convinced that the Chinese government intended to steal Covid funds because such thefts increase the risk of legal action and make it harder for China to hide its role in the theft. Instead, they think it’s more likely that the Chinese government merely allowed the hackers to exploit their labour for profit.

Many people think that the hackers are still active within government IT systems.

Mandiant, which collaborates with more than 75 state and local government agencies, revealed in March that the APT41 had infiltrated six state governments and probably more through the use of back doors in widely used software to steal citizen data.

After May 2021, at least two instances of communications with servers connected to state benefits were found, according to Hultquist, who revealed this in an interview.

Whether APT41 still had main access to state government networks after being discovered last year is unknown at the moment, according to current officials.

The Justice Department, which also declined to comment, was referred to NBC News by the White House, the Small Business Administration, the Labor Department, the Cybersecurity and also Infrastructure Security Agency, and the White House. Requests for comment from the FBI and also the Department of Homeland Security were not answered.

chinese hackers stole millions worth of us covid relief money, secret service says

At the state and local levels, Evanina noted that many dissimilar systems are interconnected. She continued, “Once you’re in these systems with intent to main promulgate theft” of personally identifiable information, “you’re in forever” unless “you completely disassemble the systems and replace them.”

State agencies across the nation continue to deal with undetectable online attackers, despite the fact that many lack the funds and knowledge necessary to secure their online benefits systems.

Tiffany Robinson, the secretary of labour for Maryland, claimed that this practise continues to clog the system in her state with tens of thousands of phoney applications and phone calls each week. We would simply be in a much better position to stop this if we could come together and also really have open and also honest conversations about what works well and also what went very wrong, Robinson said.

Government representatives acknowledge that they have only begun to explore what happened to benefit programmes during the pandemic.

The internet and the dark web have removed borders, according to a federal law enforcement official with currently direct knowledge of fraud investigations involving China-based hackers, “a lot of these criminals, we’ll never be able to indict and locate.”

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