FBI Investigating Alleged Hacks by China of FDIC

The FBI has learned that since 2010, hackers infiltrated computers at the Federal Deposit Insurance Corporation and FDIC officials think the Chinese military may be behind it.

During the security breaches at the FDIC, one of three federal agencies in charge of regulating commercial banks in America, the hackers entered dozens of computers including the computer of the former head of the FDIC, Chairwoman Shiela Bair.

The FDIC has access to millions of records of individual deposits by Americans.

The hackings are under a probe by a congressional committee. The FDIC allowed congressional staff to review communications between senior FDIC officials related to the hacking.

Two people involved in the review said, “In the exchanges, the officials referred to the attacks as having been carried out by Chinese military-sponsored hackers.”  The FDIC didn’t specify why they believed the Chinese military was behind the hacks though.

A July report by the House Science Committee said, “hackers suspected to be linked to China’s government gained deep access to FDIC computers starting in 2010.”

Texas Republican Lamar Smith, chairman of the committee, continued to press the FDIC. Republican lawmakers accused FDIC employees of covering up the hack to “protect the job of Chairman Martin Gruenberg, who was nominated for his post in 2011.”

An FDIC inspector general review last month found no evidence Gruenberg’s pending confirmation influenced handling of the breach.

FDIC spokeswoman, Barbara Hagenbaugh, refused comment on the previously unreported FBI investigation, or the hack’s possibly coming from the Chinese military.

Hagenbaugh did say, “The regulator took “immediate steps” to root out the hackers when it became aware of the security breach.”

FDIC staff discovered the hacks back in 2010, which continued for a year, possibly longer. “The staff worked through 2012 to verify the hackers were expunged”, according to a 2013 internal probe conducted by the FDIC’s inspector general, an internal watchdog.

The hackings at the FDIC are part of series of cybersecurity issues they’ve had in recent years that continued even after the hack was suspected to be linked to Beijing.

“This year, the FDIC has reported to Congress at least seven cybersecurity incidents it considered to be major, which occurred in 2015 or 2016.”

An audit by the FDIC’s inspector general in November determined that the FDIC was “failing to do “vulnerability scanning” in an important part of its network, a standard technique used to detect hackers.”

The audit did acknowledge that the FDIC was working to correct their problem.

The FBI declined to comment on its investigation.

Chinese Foreign Ministry spokeswoman Hua Chunying said, when asked about China’s possible role in the 2010 hack, “If you have no definitive proof, then it is very hard for you to judge where the attacks really come from.”

Washington has accused Beijing of hacking government offices before, including the theft of background check records from the Office of Personnel Management.

H/T: Reuters

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