The Trump administration’s haphazard and opaque interventions into artificial intelligence security matters could catapult Chinese alternatives into broader acceptance, posing new security risks altogether, a group of Democratic senators wrote to top administration officials Monday.

The five senators said that the administration’s handling has alternated between too passive, such as when OpenAI models escaped testing in the Hugging Face hack last month, and overstepping, such as when the Commerce Department suspended access for any foreign national to Anthropic’s Fable 5 and Mythos 5 in June.

“The Administration’s ad hoc and unpredictable approach undermines U.S. competitiveness, heightening market incentives to adopt open weight models from vendors based in the People’s Republic of China (PRC),” wrote Sens. Kristen Gillibrand of New York, Adam Schiff of California, Mark Warner of Virginia, Chris Coons of Delaware and Mark Kelly of Arizona.

In the Hugging Face hack, the senators wrote that “the Federal Government cannot be passive as these capabilities emerge.”

In the case of the Fable 5 and Mythos 5 suspensions, the senators said that the administration “utilized an infrequently used authority to direct Anthropic to suspend all access to its Fable 5 and Mythos 5 models for foreign nationals (including foreign national employees inside the United States) citing an undisclosed national security concern later described as a narrow jailbreak finding.”

Because Anthropic couldn’t immediately assess users’ nationality, the firm had to disable both models for everyone. The administration and Anthropic negotiated for 18 days behind closed doors before reaching an agreement, the lawmakers complained.

“While the Administration may have been responding to real security concerns to protect the United States, even justifiable interventions can create broader harm if the standards and decision-making processes are opaque, ad hoc, or unpredictable,” they said in their letter to leaders in the White House, Office of the National Cyber Director and departments of State, Treasury and Commerce. “Moreover, when the Executive Branch exercises authority delegated from Congress, such as in the conduct of export control administration, it is essential that it keep Congress fully apprised of its actions and procedures.”

During the time Anthropic was under export controls, the stock price of “an entity-listed Chinese lab” nearly doubled, the senators said. And while Hugging Face was breached, the company “had to” rely on a Chinese open-weight model due to guardrails on U.S. frontier models.

“If American models are perceived as subject to sudden access disruptions based on a black-box U.S. Government process, or as unreliable because U.S. AI labs are overcorrecting in the face of this black-box process, companies and governments in the United States and abroad may hedge by adopting Chinese or other foreign models instead,” the senators contended. “That outcome would undermine U.S. technological leadership while increasing exposure to systems that may carry risks of PRC or otherwise directed censorship, espionage, IP theft, and other supply chain security risks.”

Their letter asked for answers to questions about the standards the administration uses to determine the national security risks a frontier model presents, what legal authorities it will use to invoke restrictions, which agencies are responsible for which decisions and more.

None of the offices or departments the letter was addressed to immediately responded to a request for comment.

The letter follows inquiries at the state level, where 15 attorneys general asked OpenAI for more information regarding the security incident at Hugging Face.

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Three Russian nationals and a pair of bulletproof hosting providers directly supported a series of attacks on critical infrastructure in 21 states and several countries, according to a 2024 indictment unsealed in federal court Tuesday. 

Officials, who have been investigating the trio and their companies since 2019, said the attacks resulted in losses surpassing $62 million.

Alexander Alexandrovich Volosovik, the 43-year-old owner of Media Land; Yulia Vladimirovna Pankova, the 29-year-old owner of ML.Cloud; and 34-year-old Kirill Andreevich Zatolokin were charged with conspiracy to commit and aid computer fraud, conspiracy to commit wire fraud, wire fraud and conspiracy to commit money laundering.

The State Department also offered a reward up to $10 million for information on government-linked associates of the alleged cybercriminals and malicious use of Media Land or ML.Cloud. The Treasury Department and officials from the United Kingdom and Australia imposed sanctions on Volosovik, Zatolokin, Pankova, Media Land and ML.Cloud in November 2025. 

The three accused Russians, Media Land and ML.Cloud were all based in St. Petersburg as of 2024.

“With today’s actions, the FBI and our partners are striking at the core services that cybercriminals rely on to attack U.S. critical infrastructure,” Brett Leatherman, assistant director of the FBI Cyber Division, said in a statement. “This is another step in our broader campaign to shrink the space in which these actors can operate, forcing them to work harder, take greater risks, and lose the anonymity they depend on.”

Media Land and ML.Cloud allegedly provided cybercriminals with infrastructure and technical support to infect systems with malware and ransomware for extortion. Officials said the organizations also supported criminal marketplaces, fraudulent domain registrations and platforms that cybercriminals used to commit phishing and brute-force attacks.

Officials said they identified a consistent and long-running pattern of criminal activities facilitated by Volosovik, Pankova, Zatolokin, Media Land and ML.Cloud.

Investigators located victims across 21 states, including nine cities in the Northern District of Ohio, where the indictment was filed. Additional victims were located in Australia, the European Union, the United Arab Emirates, Canada and the United Kingdom.

Bulletproof hosting providers are increasingly used by cybercriminals to obfuscate their activities, deliver malware, phishing, and host content and services that support ransomware, data extortion and denial-of-service attacks.

“From their overseas safe haven, these defendants ran the criminal infrastructure that powered attacks on critical institutions across our nation,” A. Tysen Duva, assistant attorney general of the Justice Department’s Criminal Division, said in a statement. “Their actions put the American public at risk. We will continue to dismantle these networks and protect our critical infrastructure from cybercriminals at home and abroad.”

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The Trump administration unveiled its new federal clearinghouse for sharing AI cyber threat information between the government and private sector, and said the project is already receiving threat intelligence on cybersecurity vulnerabilities and prioritizing patching.

Created last month through a White House executive order, “Gold Eagle” will be managed by the Department of the Treasury, with contributions from the Cybersecurity and Infrastructure Security Agency, Department of Homeland Security, and Department of Defense, as well as open-source software providers, critical infrastructure operators and industry.

“Under President Trump’s leadership, the Treasury Department is working hand in hand with the private sector to safeguard our financial institutions, close vulnerabilities, and protect the integrity of the U.S. financial system,” Secretary of the Treasury Scott Bessent said in a statement. “Treasury, along with our partner agencies, will continue to harness frontier AI capabilities to stay ahead of our adversaries and defend the American people from emerging threats.”

Gold Eagle is meant to help both public and private organizations find, fix and patch vulnerabilities found using AI tools before they’re discovered and exploited by bad actors. The work will involve using AI to find cybersecurity vulnerabilities in victim systems and software, and Secretary of Homeland Security Markwayne Mullin said it would also further explore ways for the technology to be leveraged for cyber defense.

A senior White House official told reporters on a background call that closed source models from frontier AI models, including Anthropic’s Mythos, will be used to discover vulnerabilities.

White House officials said they worked with the Software Engineering Institute, SEI at Carnegie Mellon University to develop a new platform, the Vulnerability Information and Coordination Environment – or VINTS – to receive third-party reports on AI-discovered vulnerabilities. According to the White House, the system has already begun collecting intelligence on vulnerabilities and prioritizing patches.

“I think on the early side of this, we have seen that the scale of vulnerability discovery, particularly with users of new technology to scan their system, is something that is a step function change [than] we’ve seen seen before,” the official said.

As AI models have improved at carrying out core cybersecurity-related tasks – like scanning code for vulnerabilities or developing proof-of-concept exploit code – cybersecurity experts and policymakers have become increasingly worried. The modern internet is rife with insecure code, misconfigurations and other mistakes that can be identified and exploited faster than ever before using AI tools.

Vulnerabilities in open-source software can be both widespread and hidden, as many commercial software products on the market rely on open-source code but few bother to document it. When hackers compromised a logging tool in the Log4J open-source Apache software library in 2021, it required a massive, multi-month coordination effort by CISA, the private sector and other stakeholders to find and fix affected pieces of software.

The White House official said the work of Gold Eagle is reflective of the administration’s “full support” of U.S. open-source software providers and maintainers.

Open source tools are “vital to systems that run throughout our country and daily life,” a senior administration official said, speaking to reporters on background. “It is being maintained by a talented group of people and entities and we will do everything we can to support the strength of that community.”

Michael Daniel, former White House cyber coordinator under President Barack Obama, told CyberScoop that AI is still so new that policymakers continue to observe its impact and adapt. While some existing communication channels for sharing cybersecurity threat information could probably be duplicated for tracking AI threats, there is still much for policymakers to learn more about the technology, the kind of threats it produces and its ecosystem of stakeholders.

“It may turn out at the end of the day that phishing is still phishing, and the fact that now you’ve got AI tools doing it, it’s still phishing. Or there may be something fundamentally different about it that we need to figure out how to combat and share information around,” he said.

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The Treasury Department is slapping sanctions on First VPN and its administrator for allegedly selling services to ransomware operators, as well as another person aiding ransomware gangs.

First VPN Services, or 1VPNS, was “deeply embedded in the cybercriminal ecosystem” and appeared in virtually every Europol investigation in recent years, the law enforcement body said after a sting targeting the service in May.

Treasury’s Office of Foreign Assets Control (OFAC) sanctioned 1VPNS as well as its alleged administrator, Ukrainian citizen Dmytro Rashevskyi, Monday in conjunction with the United Kingdom. The outfit provided anonymity services that could be legitimate in some instances, but 1VPNS advertised itself in online cybercrime forums for more than a decade, touting its refusal to cooperate with law enforcement, the office said.

“Numerous ransomware groups have purchased infrastructure from 1VPNS, which they have leveraged in attacks on U.S. companies and institutions — including to hide the origins of their attacks, deploy malware, and manage exfiltrated data,” OFAC said. “Victims of ransomware attacks that involved the use of 1VPNS infrastructure have included U.S. businesses, financial services companies, hospitals, and municipal governments.”

Treasury also sanctioned Belarus national Yegeniy Vladimirovich Silayev for allegedly selling “cryptors,” tools used to disguise ransomware and other malware, to ransomware operators.

“Unlike legitimate encryption tools, which are designed to protect data and the privacy of the people that own it, cryptors are built specifically to make malware stealthier and more effective by disguising it as harmless files,” OFAC said.

Treasury’s sanctions designations dovetail with separate, unrelated cyber sanctions that European governments from Monday. The FBI has previously issued an alert about First VPN Service. 

Blockchain intelligence firm TRM Labs said it has seen 1VPNS selling its services to ransomware operators for prices ranging from $723 for Anubis to $58 Sinobi.

“The amounts are small because infrastructure subscriptions are small,” Ari Redbord, global head of policy and government affairs for the company, wrote on LinkedIn. “A named ransomware group paying a named enabler on public chains still leaves a trail investigators can follow after the fact.”

Victims tied to First VPN Service infrastructure include U.S. municipalities, hospitals and financial services companies.

Europol said it had arrested the administrator of 1VPNS in its May sting, but did not name them. 

The Treasury Department did not immediately respond to a question about whether its sanctions targeted that same arrested person.

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The Justice Department on Tuesday said it has seized infrastructure tied to what officials called one of the world’s most prolific criminal marketplaces, used to commit cyber scams and other crimes.

The seized cloud computing account hosted backend infrastructure used by subsidiaries of the Huione Group, a Cambodia-based corporate conglomerate.

At the same time, the Treasury Department announced fresh sanctions and more against Huione and affiliated companies. The administration actions Tuesday add to disruption efforts from last fall against pieces of the same network.

The Trump administration has placed an emphasis on combating transnational cybercrime and other kinds of scams and fraud.

The seized cloud computing account was used to operate Huione Guarantee, also known as Haowang Guarantee, according to Tuesday’s DOJ announcement.

“The Huione Group used this cloud computing account as part of a technological backbone that allowed billions in fraud proceeds to be transferred, moved, and concealed — much of it stolen through Southeast Asian scam centers,” said Tysen Duva, assistant attorney general of the Justice Department’s Criminal Division. “Seizures of these marketplaces is critical in the fight against fraud that affects so many Americans, and to stop avenues for criminal proceeds to be laundered.”

U.S. officials allege that Huione Guarantee operated Telegram channels with discussions about illicit goods and services, including the sale of stolen credit card and sensitive personal information, malware-enabled thefts, human trafficking schemes and the laundering of money from romance and investment scams. Huione Guarantee also allegedly offered escrow services for criminals such as money launderers for cryptocurrency.

Treasury took two steps Tuesday to build on its move in October to sever Huione Group from the U.S. financial system. One was to tack H-Pay Service onto its rule for Huione Group as a successor entity. And it slapped nine people and 26 entities linked to Prince Group with sanctions.

“Huione Group served as a critical node for laundering proceeds of cyber heists and virtual currency investment scams and was used by the Prince Group to transfer and consolidate scam-derived assets,” Treasury’s announcement states.

Also last October, the Justice Department said it seized bitcoin valued at $15 billion from the chairman of the Prince Group, Chen Zhi, and indicted him over alleged cryptocurrency crimes and other schemes. 

An alleged key figure in Chen’s criminal network has been arrested in Cambodia and extradited to China.

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The Trump administration issued a revised executive order Tuesday focused on artificial intelligence, offering a significantly pared-back vision for the federal government’s role vetting AI systems compared with a draft version that was spiked weeks ago.

The order keeps in place the administration’s largely voluntary framework for companies to engage with the federal government around testing new models before release, but appears to considerably weaken or loosen provisions that had been opposed by industry.

Under the order, AI companies would voluntarily provide the federal government access to frontier models before release, but now it will be for “up to” 30 days instead of the 90-day timeline included in previous drafts.

It also explicitly states that nothing in the program will be construed as mandatory or part of a federal licensing or permitting regime, and gives AI companies significant influence to help define what models would and would not be covered under for testing.

It also states that all federal testing and access to the models would be subject to “confidentiality, cybersecurity, insider-risk, and intellectual-property protection, use, and nondisclosure requirements.”

Section one of the order highlights the central friction that has plagued the Trump administration’s AI policy since assuming power: While the White House increasingly sees national security implications in the rapid release of frontier models from the private sector, it has also been one of the loudest critics of regulating the technology for fear it could harm American businesses.

“The United States continues to lead the world in Artificial Intelligence (AI) because of the enormous talent and innovation of our AI industry, and because we refuse to stifle this innovation with overly burdensome regulation,” the order reads.

That argument was bolstered in recent days as industry members and top advisers to Trump, like tech investor and AI czar David Sacks, lobbied against previous draft language, arguing it would put too much of a regulatory burden on U.S. businesses.

On X, Sacks called the revised EO, including changes reducing the government’s access from 90 days to up to 30 days “a game changer” because it would allow frontier labs to comply without delaying new model releases. He also said the discussions he’s had with the White House indicate that not all new model releases would be subject to even that level of scrutiny.

The White House characterization that the order is not a program for conducting oversight of all new AI models “is completely consistent with the discussions that I have participated in, where it was agreed that the EO is intended to apply only to models that represent a meaningful step-change in cyber capabilities (eg Mythos), not to incremental version numbers of existing models,” Sacks wrote.

The order also puts the Department of Treasury at the head of a new interagency cybersecurity clearinghouse on AI, where the private sector, critical infrastructure operators and federal agencies voluntarily collaborate to coordinate and deconflict scanning for software vulnerabilities, discovery and validation and remediation activities, like patching.

Treasury, the Cybersecurity and Infrastructure Security Agency, the NSA, the Office of the National Cyber Director and other agencies would also be responsible for developing classified benchmarks that would be used to identify or flag the kind of advanced cyber and hacking capabilities that agencies are interested in testing.  

Questions linger over implementation, politicization

Consisting of less than 1200 words, the directive is vague in many areas about exactly how implementation will work.

“On frontier capability access, vulnerability discovery for critical infrastructure, and sharing with trusted partners, many questions remain,” wrote American Enterprise Institute fellow Ryan Fedasiuk.

Senator Mark Warner, D-Va., said the order would help the White House “begin to grapple” with the threats that new frontier models and their hacking capabilities pose to critical infrastructure and praised certain provisions, like putting the NSA in charge of classified testing of new models. But he was also sharply critical of the administration’s about face on the need for federal scrutiny of emerging AI technologies.

“Once again, the Trump administration has belatedly discovered the need to redo something it hastily dismantled in its first year,” Warner said in a statement. “While this course correction – a rehash of proposals contained in the last administration’s 2023 executive order, bipartisan congressional legislation, and each of the last three years of intel authorization bills the Senate Intel Committee has passed – can begin to grapple with widespread impacts that new frontier models will have on our critical infrastructure, it can’t undo the years wasted on dismantling some of the most vital pillars of our nation’s cybersecurity response, including key information sharing initiatives and the federal agency established to protect the security of U.S. critical infrastructure.”

Warner also said he will be “watchful” for indications the administration may politicize any testing regime, for instance, such as using the partnerships “to pressure U.S. firms into making changes to their products or Terms of Service to suit partisan or legally questionable objectives of the president and his allies.”

The administration’s lighter touch approach around voluntary testing yielded approval from some experts who have traditionally been more in favor of regulation, but who also expressed similar worries about the downsides of putting the federal government in charge of vetting AI models.

Samir Jain of the Center for Democracy and Technology, said that while AI models pose real cybersecurity threats to critical services, the order “attempts to avoid the deeply concerning implications of a mandatory licensing regime for release of new models.”

“Testing and benchmarking programs are important to promote cybersecurity and address other risks,” Jain said in a statement. “However, the EO should not become a mechanism for the Administration to punish companies for political or other arbitrary reasons, and so we will be closely monitoring the details of its implementation as they emerge.”

You can read the full order on the White House’s website.

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President Donald Trump said he would postpone the release of an executive order that would set up a 90-day testing and vetting regime for frontier AI models, hours before the White House was set to publicly announce the signing. 

Speaking to reporters in the Oval Office Thursday, Trump said he opted to delay the order “because I didn’t like certain aspects of it” and expressed concerns that it could harm U.S. AI industry competition with countries like China. 

According to multiple sources, a draft version of the order circulating in the last 24 hours would have set up a voluntary testing regime between the U.S. federal government and frontier AI companies that would allow the government to study new models for 90 days before they’re publicly released. In addition to the government, the draft order would also facilitate access to the models for cybersecurity testers in critical infrastructure sectors, like finance and healthcare.

The draft order empowered the National Security Agency to conduct classified evaluations of frontier AI models, while the Department of the Treasury would have set up a new information sharing agreement between AI companies and cybersecurity defenders in critical infrastructure.

Other agencies, like the Office of the National Cyber Director, the Cybersecurity and Infrastructure Security Agency and the National Institute for Standards and Technology, would also be involved in defining which models are covered under the vetting regime.

In some sense, the order would formalize an already cooperative relationship between AI companies and governments like the U.S. and UK, where tech-focused agencies and regulators have already been provided access to previous models ahead of their release for testing and evaluation. 

A former federal official who has seen the latest draft circulated before Thursday’s announcement told CyberScoop that based on their conversations with the administration, the order was intended to facilitate more robust testing from government agencies compared to evaluations conducted for previous models. They said that is in part a reflection of the federal government’s maturing understanding of AI technology over the past five years.

“In the past there has been containerized optionality for the intelligence community and others to take a look at things, but it was really a lot of hand holding [from AI companies] and self-explanation of what they expect this thing to do,” said the official, granted anonymity to discuss sensitive conversations with the administration. “And now the government is coming forward and saying now we feel we’re prepared enough for you to just give us your tool…and we’ll go from there.”

But it also represents a stark pivot by the Trump administration, which came into office openly dismissive of AI safety policies and arguing that they would inhibit U.S. industry. Trump’s latest comments in delaying the order echo those same attitudes. 

The former official said that while the Trump White House doesn’t view its mission as telling AI companies “don’t develop AI that can do X, which was perceived to be the previous administration’s role,” they also acknowledged the administration’s early rhetoric on AI regulation has painted them into a corner. 

“I think the biggest challenge the administration has is that their tone was ‘no institution of guardrails’ and they don’t have a better word for making sure that the capabilities of emergent frontier models don’t disrupt security than to say ‘let’s test it and institute guardrails,’” the official said.  

While debate about how best to regulate AI-related harms continues, most agree there are genuine national security concerns around the technology.

Ram Shankar Siva Kumar, founder of Microsoft’s AI red team, told CyberScoop that in 2019, his staff consisted of himself and a few other security and machine learning specialists. Now a much larger staff of technologists are supported by specialists in psychology, linguistics, bioweapons and other fields.

“Because of frontier harms, what we have done has really morphed,” Siva Kumar said.

The United States, along with Israel, Russia, Ukraine and others have already deployed AI in targeted military operations or integrated the technology into their larger command and control structure. AI is being used to supercharge drone warfare, global hacking campaigns, and sophisticated surveillance and targeting of military personnel and civilians, imbuing the engineering choices of frontier AI companies with life and death consequences.

Some congressional members who previously opposed allowing AI to make autonomous kill decisions on the battlefield have been reconsidering their position.

Rep. Don Beyer, D-Va., who co-chaired the Congressional AI Caucus and was appointed to a bipartisan AI task force in 2024. said that while he thinks “we need to guard against dehumanizing” those decisions, he also worries that adversarial countries will use the same technology against the United States.

“It’s like if we say that Americans have to have a human in the loop and the Chinese don’t have to have a human in a loop, the non-human one will beat the human one every time,” Beyer said at an AI conference in Washington D.C. earlier this month.  

Meanwhile, experts have been increasingly concerned about the technology’s impact on cybersecurity, as current models are remarkably good at finding software bugs and vulnerabilities, while newer models like Anthropic’s Mythos and OpenAI’s Daybreak are capable of chaining together multiple exploits to conduct more sophisticated attacks.

While state-sponsored hackers are experimenting with the technology and using it to gain targeted efficiencies in their hacking operations, cybersecurity experts in the private sector and law enforcement agencies say the technology has mostly benefitted cybercriminals and scammers.

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