Transcripts For CSPAN2 Justice Department Briefing On Russian Hacker Bank Fraud 20240713

We are here to identify and announce charges against a Russian National who the department of justice alleges is responsible for two of the worst computer hacking and Bank Fraud Schemes of the past decade. The charges were announcing today are nearly allegations in each of the dependence is presumed innocent until Proven Guilty beyond a reasonable doubt in a court of law. Maxine iacobucci of moscow russia, has been indicted in Pittsburgh Pennsylvania for his alleged role as the leader of a cyber criminal gang responsible for the distribution of a multifunction malware package known as bugatti. The gods was designed to automate the theft of confidential personal information and Financial Information such as Online Banking credentials from infected computers. Later versions of the malware also known as dry decks were designed with the added function of assisting in the installation of rand somewhere. Over the past decade the buka at malware facilitated the theft of millions of dollars from victims, some of which occurred as recently as may of this year. A second coconspirators ego was also indicted in pittsburgh in connection with boo got scheme. Yucca veg is also been charged in a criminal complaint in lincoln nebraska for his participation in this game to disseminate zeus a similar form of malware that was like wise used to empty out financial accounts of its victims. According to the complaint the deployment of zeus resulted in a total attempted theft of around 220 million with actual losses of an estimated 70 million from victims Bank Accounts. Yucca veg is a true 21st century criminal who with the strength of the key and click of a mouse had cyber crimes across the globe. Hes earned his place on the fbis worlds most wanted cyber criminals. Today our colleagues to the state department will have an announcement in a few minutes that will further our collective efforts to bring iacovelli to justice. A little bit of detail about the mallard employed by yucca veg in his coconspirators. Both forms of the malware intercepts passwords and other private information that can be used to conduct wire transfers. The malware then initiates a or read rex wire transfers from victim Bank Accounts to foreign Bank Accounts controlled by the criminals. Because many of the victims of both boo gods and zeus are small and midsize businesses, their accounts typically do not have the same protections afforded to consumer accounts. So some of the losses involved over particularly devastating. Iacovelli and his coconspirators did not discriminate either on their choice of targets. For example the nebraska complaint alleges directly involved in tens of thousands of dollars from religious order of franciscan sisters. Yucca veg and members of his criminal network devised and implemented the kinds of criminals game so audacious and sophisticated that it would be difficult to imagine if they were not real. Sitting quietly at computer terminals far far away, these cyber criminals allegedly stole tens of millions of dollars from unwitting members of our business, nonprofit, governmental, and religious communities. Each and every one of these computer intrusions was effectively a cyber enabled bank robbery. We take crimes like this extremely seriously, and will do everything in our power to hold these criminals accountable for their crimes. The justice department, federal prosecutors, fbi analysts in authorities and a number of different jurisdictions all Work Together to unmask iacovelli and his coconspirators. The assistance provided by numerous private sector partners was likewise invaluable, but i also want to especially thank our foreign Law Enforcement partners who are on stage here today from the United Kingdom. A National Crime agency and the metropolitan Police Service in the uk detect had their own service in the harms that zeus and boo got viruses head to the uk and uk victims. These folks also provided invaluable assistance to our investigations here in the United States as well. The uk also extradited to have iacobuccis coconspirators and this is scheme to the United States to face justice. Iacovelli allegedly has been engaged in cyber crimes on an almost unimaginable scale for over a decade. Our goal is to identify the perpetrators of these crimes in rapid fashion. The reality of Law Enforcement work is that a quick resolution to these cases cannot always happen. But make no mistake, we will doggedly pursued cyber criminals until we can bring them to justice. Todays announcement should make clear to those engaged in cyber crime, that we will identify you, we will unmask you, and will prosecute you, no matter how much effort it requires or how long it might take. You will never have a safe haven from the efforts of the United States Law Enforcement and our International Partners to bring you to justice. And to that end i want to thank the United States Attorneys Office from the western from the district of nebraska, the fbi, state department, and the uks National Crime agency in metropolitan Police Service. All which are represented behind a by individuals and leaders of those particular institutions. And with that id like to turn over to scott brady of the district of pennsylvania to make some remarks. Thank you brian good morning everyone. Today we have announce an indictment now the Western District of pennsylvania against two of the most prolific cyber criminals in the world. Mocks him iacovelli and igor tour have spent the last decade infecting Computers Worldwide with the boo got dry decks malware. Companies and citizens of the Western District of pennsylvania have been targeted and defrauded by these cyber criminals. Yucca veg also known as aqua, is the leader of the boo got cried ex dry decks malware and botnets conspiracy. He oversees and manages the development, maintenance, and distribution, and infection of malware. Ego also noticed thank, or an into two is also a close associate of iacovelli and serves as the system administrator, as oversight over botnets, and manages internal systems used by the criminal group. Together these two criminals have victimized our district and the world at large. Some of the victims in western pennsylvania include a school district, two banking institutions, and number of businesses including a petroleum business, technology company, a manufacturing company, and a Building Material supply company. The dry decks malware conspiracy was a constantly evolving and adapting criminal enterprise that had a level of sophistication and scope of threat that we rarely see. And this conspiracy was marked by constant innovation. Even as we disrupted jabber zeus malware conspiracy, the game over zeus, and we prosecuted one of dried axis system administrators in 2015 named ginkgo. We sing called a sub botnets for this conspiracy in 2016 including, and we also indicted a belarusian money mule network in 2016. In spite of all these efforts by Law Enforcement, they continued to adapt and innovate. They went from centralized command and control systems to peertopeer botnets. They used more sophisticated web injects, they increase their use of encryption and enhance security methods. And they change from the use of International Wire transfers to ransom ware and crypto currency to private accounts. And this is why this is been the most widespread and destructive malware and banking trojans in the world over the last decade. I do want to say a quick word about the victims. You note the department of justice we are charged with enforcing the laws the United States and seeking justice. But our calling is to protect our fellow citizens and our friends and our neighbors. And the First Western pennsylvania evicting when sharon high school, sharon pennsylvania is a small steel town and i actually have family members who have attended and graduated from sharon. And we know that for every dollar stolen from the school district, thats one less dollar that they have for the High School Football team, are the Girls Basketball team. One less dollar for teacher salaries or for special education. For every dollar stolen from an individual, thats one less dollar they have for their retirement. When the seller they have for their childrens education or for a family vacation. And for every dollar stolen from a company, thats one less dollar to innovate, to create new products, to enter new markets, or to hire those same friends and neighbors. And this is why we go to the ends of the earth to investigate and prosecute cyber criminals. These of the cyber criminals who victimize our citizens i will pursue them, we will prosecute them whether these criminals are in Pittsburgh Pennsylvania in mints or in moscow. I like to echo brians thanks to our International Partners especially nca, but id especially like to recognize for the western pennsylvania indictment the work, outstanding work of assistant u. S. Attorney and the work of the best cyber group in the fbi in the field office of pittsburgh. And now were going to hear from joe kelly who is the u. S. Attorney from nebraska. Thank you. In the district of nebraska, the complaint against the iacovelli and his coconspirators refers to three different nebraska Bank Accounts belonging to Small Businesses and to emphasize thats just the net brassica aspect for the victims. The conspiracy is much broader than that, and into other states. But as to those three nebraska intended victims, to were averted. In those cases there were no losses associated with the two businesses, but there was actual loss of a hundred and 59,000 with regard to the third period thats just in the state of nebraska. But as been said, the actual losses to all victims in the various states is estimated at nearly 70 million. The methodology was similar each time. In fact the business computer, obtain Bank Account Numbers and security codes, and initiate Electronic Fund transfers to money mules overseas. We appreciate the hard work and the intelligence of roach to this investigation by all the justice department, u. S. Law enforcement agencies, and their partners around the world. I want to recognize the Important Role played by the omaha fbi office in this investigation from its inception. This is a great example of the ongoing teamwork Law Enforcement in the International Community clearly demonstrates the resolve to hold these criminals accountable. When someone hears about a case like this, very often the First Response is well theres nothing you can really do about these. Today, were here to demonstrate that we can. And will. Good morning, as you know the fbi is charged with defending United States citizens and businesses against a wide range of cyber crimes. We face Cyber Threats from hackers, hikers for hire, organize sin syndicates and overseas adversaries like the individuals that are indicted today. Todays announcement we are launching a wide ranging disruption operation targeting his coconspirators that he leaves. Over ten year period to cuba its also known as aqua and his coconspirators have operated, and improved multiple malware variants to go after us many victims as possible. They enrich themselves through theft, fraud, and deceit. They spread their malware primarily through phishing emails, spam campaigns. They because losses and exes of tens of millions of dollars with attempted theft raging in the hundreds of millions of dollars. These malware variants affected thousands of u. S. American victims. They include a Dairy Company in ohio to a luggage store in new mexico. And even an order of religious sisters as the assistant attorney noted previously. I want to emphasize a few key points that cases like this demonstrate. First, they show the evolution of cyber criminals and their capabilities. Over the past several years and how persistent these cyber criminals are. In this case we have individuals and groups using different tools, tactics and techniques over time and they adapted them to effectively evolve their scams. Second, these cases show that cyber criminals have banded together. They are leveraging each others strengths and forming organized criminal syndicates. To more effectively victimize our public. Which brings me to the third. To successfully combat them, we as Law Enforcement partners, must do the same. We must come together, partner closely, and leverage each others strengths. We must integrate and innovate to combat these cyber criminals globally. And thats just well done here. The fbi would also like to thank its partners from certainly the department of justice, the department of state, treasury department, and the uks National Crime agency. Strong national and International Partnerships are important to cyber investigations. As we have often said publicly, cyber criminals disregard borders be they states or countries. This often requires an International Response like the one youre seeing here today. In the case of you convicts, the fbi works handinhand with the National Crime agency and sharing investigative information and intelligence information for nearly a decade. Why nearly a decade . Because these cases are incredibly complex and the networks that purge perpetrate them are very complex and sometimes global. These are sophisticated cyber criminals operating complex variance sale investigations of this type do take time. Todays announcement demonstrates are resolved to bring cyber criminals and their activities to lights. Because these criminals are in russia, some ask why pursue them . You may never get your hands on them. Its difficult, no doubt. But its not impossible as we have shown time and time again. Although the long arm of the law, and i do like that term, does stretch throughout the world. And having your name your face, or description on a wanted poster makes moving around freely much more difficult. So we are going to keep at it because collectively the fbi on our partners, we have a very long memory. And we will never give up. We have a track record of success when it comes to catching cyber criminals throughout the globe. Simply naming them and then indictment accomplishes a great deal. We know that through many forms and fashions. Through many methods. State sponsors and other clients cry hackers for their anonymity, deniability, and their stealth. Calling these actors out publicly through these indictment strips away that anonymity. Other parts of our government can use the information developed through our investigation to impose additional costs. Like financial sanctions or revoking the ability to travel. And finally, the charging document is a key step in achieving justice for the victims. We could not have gotten this far in our case without the cooperation of the victims. And i think sometimes we think about financial impact. Thats significant, but we also have to member they are people behind that financial impact. We understand that companies and institutions are under immense pressure during and certainly after cyber attacks. And they may be reluctant to report these breaches. But we urge all victims to contact their local field office, their local fbi field offices soonest possible once they realize theyve been hacked. And we encourage our victims to file a detailed report with the Fbis Internet Crime Complaint Center at www. Dot i see three. Gov. The fbi may be able to provide Additional Information or help during, and certainly after an attack. You two can help us fight these attacks. We all need to do our part to make sure that our systems are as secure as possible. There is no guarantee against exploitation for anyone. But we cannot stress enough the importance of cyber hygiene. And preventative measures that we can take. Time and time again, we find that not following the basics of cyber hygiene makes us more vulnerable. And allows us to be more easily exploited. For guidance and to help improve your systems. Please visit www. I see three. Gov. We have to do whatever we can together to lay hands on these criminals to deter others from joining them. I do want to not only thank our partners, but i would like to thank the efforts of our agents enter analysts from the fbi. Certainly our partners as well have worked very hard. But my own people, we appreciate your diligence, these cases are very difficult. There tedious and technical and they required tenacity and resolved. Thank you. The efforts to bring yucca veg to justice is a high prairie for the nine states. The state department is pleased to be part of this joint effort. The fact that all her agencies and the United Kingdom are represented here today underscores how closely we Work Together. We bring unique tools of our respective agencies to bear against transnational terminals and transnational organizations. These that threaten the or our people. There is one particular state department tool that we are plying here today and that is the transnational organized crimes rewards program. Through this program we are pleased to announce a reward of up to 5 million for information leading to the arrest and or conviction of russian cyber criminal maxime jacob it. Considering the staggering cost, cyber prep crimes are Significant National Security Threat tonight states. The Transnational Organized Crime Department is one of the many tools state department uses to bring cyber criminals to justice. As my counterparts have already stated, todays action is one step to ensure that cyber criminals like yucca veg cannot hide from justice. We will continue to Work Together to protect americans from these threats. And now i like to turn it over to our uk colleague from the National Crime agency, director of threat leadership, robert jones. Center thank you and thank you for colleagues from the United States for inviting me here today to talk about this investigation which is a landmark in the history for International Collaboration and tackling cyber crime. Theres a long story that sits behind what uc today and im really pleased to see the true identity of aqua being unveiled and see the people are being held accountable for their actions. Its this is the start of us beginning to deal with the harness been caused by these individuals and the story that sits behind this goes back many years. In the uk whilst weve been trying to degrade the threat posed by the organization that weve been investigating, weve already succeeded in convicting 18 individuals in 40 years of prison sentences have been delivered. We see a very real harm thats been caused victims in the uk and that manifests itself with the rural world victims. As colleagues have already described, behind these sophisticated attacks, behind the cynical online monitors that they used to disguise their identity, there is a realworld harm like peoples life savings, their companies are being compromised by these individuals. We estimate that at least 300 different organizations and 43 countries have been affected by these attacks. And that will be an underestimate. We think there are tens of millions of hand dollars it is been recognized by this organized crime group that we have tried to draw down through financial institutions. The fundamental weakness that organized crime has is they are driven by money and they are driven by greed. And we have been able to gain evidence in the uk of a realworld footprint of people seeking to draw down funds and also people who are exhibiting a very extravagant lifestyle online. There is a rich irony on the story that you will see over the coming days where many of the individuals who we believe are involved in this type of activity move exploited the online vulnerability of normal citizens the uk and around the world have themselves shown of vulnerability online. By exploiting that vulnerability and by seeking evidence over many, many years and weve been able to meticulously over the nine years activities pieced together a trail of breadcrumbs with the leads you back to world world identities. That has shown that some of these people have made significant mistakes online. And its through those mistakes and exploiting those mistakes that we have evidence that we have been able to share with colleagues which gives us a range of options to be delivered by our colleagues in the u. S. Im very proud to be sitting alongside an agency like the heritage of the fbi to bring this sort of briefing to you all. This is a multiagency effort its involved Numerous Departments in the u. S. Its to involve Numerous Department in the uk, id like to pay tributes to the metropolitan police, the National Service Security Center and others who have stuck with this long game for many, many years. Id also like to commend the small team back in the uk who i know will be watching this for the applet efforts they have made. There is a fundamental. In solving the crime and tackling the cybercrime were many worlds say ive colleagues if already pointed out you are wasting your time trying to arrest people. Youre wasting your time trying to deliver evidence behind these events. That is plain wrong. We will extend our reach. We have a long memory. And we will relentlessly pursue individuals online until we identify their identity, before we would get a realworld footprint and they will take the best route to take them to justice. Thank you. I have a question can you describe a little more campaign you mentioned. The campaign that i mention . The campaign i mentioned to the spearfishing campaign. But what i will tell you is again back to the no borders issue. We continue to evolve our Cyber Crimes Program to attack these folks wherever they are. The fact that the National Crime agency is here and we had such a Good Partnership with them, and they worked so hard and so well together in conjunction with u. S. Law enforcement and u. S. Prosecutors, its amazing the indictment that you we are seeing. And i would refer you to the charging instruments are put forth here today. You can learn a lot from these charging instruments to the general public is welcome. You mentioned there were connections to the russian government. How extensive are those connections . Did the russian government profit for many this illgotten money . I did not mention irony for you to the charging document. Based on what youve done today. Have you put these biz people out of business or this still capable of striking other victims. Thats a great question in the short answer is one of the reasons we did this today was to raise awareness for potential victims down the road. We have victims as recent as may of this year who were victimized by this malware. And so it is fair to say that they are not out of business at this. But that is our ultimate goal. Will these people ever get their money back . There is a forfeiture complaint, forfeiture clerk counts in the pittsburgh complaint and that is our aim. To follow the money wherever we can, however successful we are able to be what time will tell. Is anything they can do to protect themselves from the sky moving forward . Yes, and then i want to come back and clean up my answer to your question a little bit. Yes, first of all again back to the basics. Change your password, to factor out this authentic and tatian. Something you should have and something you should know is the best way to explain to factor off the authorization. Make your password difficult to make you were selfaware of them. And certainly do not click on certain links unless you know the source. That is her people are getting caught time and time again. Both in their personal business but actual companies is occurring on a regular basis. To the attachment to draw peoples end, make them want to click the attachments. Is there any one methodology . Theyve evolved it and i wouldnt say theres any significant commonality. Look for a legitimate, before you click think hard. Thats the best advice i can give to people on that. And i want to come back to your question on connections to the russian government. Right now we are here today just to focus on what is in the four corners of this document. The two men that were believed to be able was last time Law Enforcement saw them moving online . Do you believe in russia . And you said yeah coverage gives direct business with the russian government . So was he involved in the president ial election . Im in a let you look again and look at the document. Im let that stand on its own. Speaking of the complaints, theres a reference in the complaint to Washington Post story about one of these victims. And then theres a long series of conversation along the conspirators talking about that story. Im just curious what is that value of having this people say oh look theres a story about us, i guess were in trouble now. I know exactly what youre talking about, but i think for a better answer on that when im in refer that to one of the u. S. Attorneys. In the process of monitoring these two, can you tell us anything about their lifestyle. Has it become rather wealthy caught in the process . So what can you tell us in terms of what you know about them and what theyve been doing with this cash . We been able to identify an Online Presence for these individuals. We will be releasing some materials in relation to that that gives you a very good portrait of their behavior on the type of lifestyle they lead. Which is cash rich, flashcards, and behaving and acting like very flamboyant and extravagant millionaires. There quite bold and obvious to living the life of rush of men and rich men in russia. You could say that. The you said the worldwide use of 300 victims and 45. Certain much more than 300 victims some of the victims or organizations, summer individuals, there are thousands of victims in relation to this activity. The estimate is a low estimate of over 300 organizations in 43 Different Countries where this malware has had an impact. Give a total dollar or pound value . I cant say for certain but its probably hundreds of millions worldwide. How many people neo k. Eight people and 40 years of prison sentences. Some but he said the other day they issued a statement was told by the fbi that the new facial Recognition Software which is a fun game, where you can make yourself look older or younger. Maybe a fishing expedition. I can never the name of the app, but is it any way related to this . Let me step in and give you a nonanswer because i cant familiar with that but i can get back john that. U. S. Attorney in 2016 smile ex was cooperating can you talk about whether its cooperation led to the indictment today or how valuable that was . Im sorry cant talk about that. You mentioned a number of these activities that were averted how are they averted . How did the victim recognize that they were about to happen. Without when god was in the indictment. There is an ongoing collaboration and partnership between the public and private sectors. Theres constant constant flow of information, i think that was mentioned, so we are aware of threats, either the Public Sector or the private sector we are sharing that information realtime so they have the information they need in a timely way to combat it. Have your russian counterparts being cooperating with this investigation . The russian government did provide a response to a Legal Assistance treaty request. It was a response that was helpful in the investigation to a. I want to come back and more holistic labor answer your question about the conversation regarding the russian post article. I think the lesson you learned from that is an indictment that is very public. A complaint or even good reporting unmasks these folks. And they do watch from afar, so i think once again it demonstrates why those types of actions are so important and as you saw from the conversation, they didnt like it that they were unmasked. Can you. Can you give us more detail about the conversation with the russian government . Im not going into any more detail audit. What about ran somewhere malware. Do you know how they were responsible for that you know how many were carried out in the u. S. . I do not now i know there are thousands of people victimized the u. S. But i dont know the actual number. Thank you very much after that, financial regulators testify about digital currency, banking rules, and the impact of Climate Change on the financial industry. Then, a forum on government surveillance and privacy. This weekend book tv features three new nonfiction books. Saturday at 8 45 pm eastern scott adams creator of the comic strip gilbert author of loser think we are all elevated in our opinions because the news model is forcing us to to learn more provocative stuff. Before they would say heres the news, there is my news. Now its replaced entertainment. 11 05 pm eastern retired navy admiral and supreme allied commander James Defreitas discusses his book saving true north. I would go into combat in afghanistan all tricked out with my bulletproof everything and my helmet. Guys on my right and left with big guns, it was actually pretty safe. Next to me would be someone like Richard Engel from nbc news. Standing there in an ill fitting bulletproof vest and i assure would stop a bullet. Hes got like a little tinpot helmet on, canted off to one side. Hes risking his life to tell us whats happening. Do you think he is serving us . I do. Then sunday at 9 00 p. M. Eastern on after words New York Times contributing opinion writer ab shes interviewed by new York Magazine writer at large and author rebecca trickster. People are always asking me, im sure theyre asking you constantly, whats the path to redemption . What we do . We have to have something. Ive been trying to come up with an answer because people keep axing me. I realize that the answer is, i dont know . Its not my responsibility to do your job. How about you workshop it. You troubleshoot. Keep trying stuff until people forgive you. I dont know. How about you figure it out . Watch book tv every weekend on cspan two. For campaign 2020 this weekend we are live in iowa following the democratic president ial candidate. Saturday at 3 00 p. M. Eastern former Vice President joe biden mayor Pete Buttigieg and Senators Amy Klobuchar Bernie Sanders and cory booker speak at a labor forum in cedar rapids. Then sunday at 1 00 p. M. Eastern senator Bernie Sanders speaks with reporters at Simpson College in indianola. Live campaign 2020 coverage from iowa on cspan. Watch anytime at cspan. Org and listen on the go with the three cspan radio app. As House Democrats along with Speaker Nancy Pelosi began drafting articles of impeachment on President Trump and ukraine the House Judiciary Committee meets on hearings of evidence live monday 9 00 a. M. Eastern with democratic and republican counsel presenting findings from the impeachment inquiry. Watch live on cspan online cspan. Org or listen with the free cspan radio act. Next, the Supreme Court hears oral argument in a gun rights case. Several gun owners in the nra new york affiliate challenged rules for having handguns at home. New york city and state regulations limited pistol owners to carry our their weapons to one of the city seven firing ranges but not a second home or shooting ranges for competitions another state. Lower courts upheld the regulations as justified to protect safety. But those laws were changed after the Supreme Court agreed to hear the case. However, the justices opted to hear arguments. This is the first gun rights case the court has heard in 10 years. We will hear argument first this morning and case 18 to 80 the new york state rifle and