Risky Business #740 -- Midnight Blizzard's Microsoft hack isn't over
Mar 12, 2024
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John P Carlin, former principal associate deputy attorney general, discusses SEC issues and the SolarWinds case. Topics include Midnight Blizzard's Microsoft hack, e-prescription drug sales, CISA ownership, and VMware's Tianfu Cup. Also covered are ransomware attacks, AI in cybersecurity, SEC disclosure requirements, and baselining cloud workloads.
Enhanced information sharing between CISOs and government officials improves security protection.
Transparency in SEC disclosures is crucial for investor trust but must avoid aiding potential attackers.
Regulatory scrutiny and enforcement actions impact CISO recruitment and create industry uncertainty.
Deep dives
Importance of Information Sharing for Security Protection
Information sharing between Chief Information Security Officers (CISOs) and government officials is critical for enhancing security protection. Encouraging open and candid conversations can help in identifying weaknesses and improving security programs. It is essential to ensure that sharing detailed vulnerability information does not unintentionally aid malicious actors.
Balancing Disclosure and Investor Transparency
While the SEC complaint focuses on potential misleading statements to investors regarding security practices, amending the complaint to specify detailed facts can help in clarifying reasons for enforcement actions. Transparency in public disclosures is vital to investor trust, but caution is necessary to prevent disclosing vulnerable information that could aid potential attackers.
Addressing CISO Concerns and Regulatory Impact
The enforcement actions and regulatory scrutiny in recent times have caused concerns among CISOs, affecting recruitment and job satisfaction. Specific misconduct allegations highlighted in cases can create uncertainty and impact industry professionals. Clear guidelines and standards are essential to distinguish between compliance violations and standard security challenges faced by CISOs.
SEC Disclosure Requirements and Rapid Market Response
The podcast episode delves into the SEC disclosure requirements, highlighting a case where a company faced significant market impact due to rapid public disclosure of material information. The company published disclosures within a short timeframe in response to a complaint, leading to market volatility with a notable share price decrease. Subsequently, a focus shifted to potential misleading statements made by the company to investors through public platforms, indicating a shift in regulatory scrutiny and enforcement.
Data Integrity, Regulatory Reporting, and Cybersecurity Incidents
The discussion expands on the challenges of determining materiality in cybersecurity incidents and the complexities of regulatory reporting. Emphasis is placed on ensuring data integrity through fingerprinting software behavior in Kubernetes environments and detecting drift for anomaly detection. The podcast raises questions about the SEC's guidance and proactive reporting measures, suggesting a need for a balance between mandatory disclosure and avoiding market misinformation.
On this week’s show Patrick and Adam discuss the week’s security news, including:
Weather forecast in Redmond is still for blizzards at midnight
Maybe Change Healthcare wasn’t just crying nation-state wolf
Hackers abuse e-prescription systems to sell drugs
CISA goes above and beyond to relate to its constituency by getting its Ivantis owned
VMware drinks from the Tianfu Cup
Much, much more
This week’s feature guest is John P Carlin. He was principal associate deputy attorney general under Deputy Attorney General Lisa Monaco for about 18 months in 2021 and 2022, and also served as Robert Mueller’s chief of staff when he was FBI director.
John is joining us this week to talk about all things SEC. He wrote the recent Amicus Brief that says the SEC needs to be careful in its action against Solarwinds. He’ll also be talking to us more generally about these new SEC disclosure requirements, which are in full swing.
Rad founder Jimmy Mesta will along in this week’s sponsor segment to talk about some really interesting work they’ve done in baselining cloud workloads. It’s the sort of thing that sounds simple that really, really isn’t.