OpenAI and the Ukrainian government have agreed to a partnership that will provide AI tools and subsidized computing resources to better protect the nation’s critical infrastructure from cyberattacks.

The agreement, announced Wednesday at OpenAI’s New York office, will provide Ukrainian cybersecurity officials with access to advanced AI models designed for cybersecurity work through the company’s Daybreak program. OpenAI said it is also pledging over $1 billion in subsidized tokens to support the initiative.

During a panel discussion Dmytro Kushneruk, consul general of Ukraine in San Francisco, outlined how the tools would be used for cybersecurity automation, including functions such as incident response, threat triaging, login analysis, inventorying systems, code analysis and validating vulnerabilities.

In nearly all cases, Kushneruk said the primary benefit was carrying out those functions at machine speed. But this speed is meant to complement, not replace, Ukrainians’ human expertise.

In regard to incident response Kushneruk said humans must view “thousands and thousands of these logs and they have to find what’s really important, that’s why AI can give capable defenders really much greater advantage and leverage.” 

“This is why the object is not to replace the cyber defender with AI, but to make sure the cyber defender acts faster,” he added.

Kushneruk said that for Ukraine, the partnership “is really not about protecting computers, it is about actually keeping our country running.”

Ukraine faces approximately 6,000 cyberattacks per year, or about 15 per day, according to Kushneruk. Over the past twelve years, the country’s critical infrastructure, including electricity and water systems, has endured sustained attacks from Russia in the form of cyberattacks and physical strikes.

Since Russia’s 2022 invasion, Ukraine’s critical infrastructure has been under constant threat. While missiles remain the primary concern, Kushneruk said Ukraine has been preparing to protect vital services since Russian GRU hackers shut down the country’s power grid in 2015. 

He added that while the country was “maybe not so much prepared” to deal with the fallout in 2015, it improved over time, including the resilience displayed in 2025 when trains kept running after Russian hackers attacked Ukraine’s railway system.

Some national security experts and congressional committees have explicitly cited the resilience of Ukrainian critical infrastructure as a model for U.S. industry.

Naz Durakoğlu, minority staff director of the U.S. Senate Foreign Relations Committee, said there is “pretty much across the board” agreement between the parties in favor of similar adoption of defensive AI tools by U.S. critical infrastructure operators, though issues like regulation remain sticking points.

“This is something that’s already happening, and frankly, it’s just kind of a basic duty of government to make sure that when you turn the tap on, water comes out, the electricity doesn’t go out, and hospitals keep running and treating patients,” said Durakoğlu. “So there is a broad understanding that this is a major issue, and I will say seeing what Ukraine has to go through day-to-day is also a huge wake-up call to our members on a bipartisan basis.”

OpenAI has publicly pushed for its product, and AI at-large, to be used to solve these types of problems. Company president and co-founder Greg Brockman signed an open letter released earlier this year calling for “collective action” and widespread use of AI models to find and fix vulnerabilities before the rest of the world,  including foreign governments and cybercriminals, got access to the same capabilities.

According to Politico, OpenAI CEO Sam Altman met with U.S. power companies in July to discuss using AI to protect the nation’s electrical grids.

On Wednesday, OpenAI’s national security policy head, Sasha Baker, said the company felt “urgency” to try to strike similar agreements with other governments and industries.

“There’s this period of time where we’re really rushing to get [these tools] in the hands of critical infrastructure operators, of governments around the world, of people who want to patch systems, defend their networks, remediate vulnerabilities because we know as these tools proliferate out there in the ecosystems, there are going to be bad guys out there that also try to use them,” said Baker. “So, we have this window of time to take action and we’re really motivated by the idea that we need to act with some urgency.”

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President Donald Trump continued to defend his administration’s hands-off approach to AI regulation in the wake of hacks carried out by U.S. commercial frontier models that have rattled policymakers and industry veterans and spurred calls for more regulatory oversight.

In a Truth Social post Monday, Trump dismissed worries from critics that “AI is going to kill us,” comparing them to complaints from environmentalists about climate change, which he also alleged was a false narrative. He also posited that nothing may matter more than future U.S. dominance of the technology over geopolitical rivals like China.

“Whoever wins AI, WINS!” Trump posted. “We are leading now over China, and everyone else, and I’m going to keep it that way! I’m not going to stifle Growth, of something that will be bigger than the Industrial Revolution, or the internet, itself.”

Trump has previously suggested that good leadership is the only regulation the U.S. needs for artificial intelligence. He later claimed the Department of Justice was ready to “rein things in” if companies overstepped, but offered no specifics on enforcement, legal authority, or where he would draw that line.

“We will be careful, and that’s why we have the Department of Justice, and other Law Enforcement bodies, that will rein things in if we have to, but I will only encourage AI or, SI (SUPER INTELLIGENCE)!” Trump concluded.

Secretary of the Treasury Scott Bessent recently told Congress that private lawsuits could force AI companies to institute better security, saying it’s clear what the government “shouldn’t do on safety is to give these labs a liability exemption, which is what they are asking for.”

“The best way to guarantee safety is that the creators are liable for what they build and generate,” Bessent said.

Beyond existential fears, critics also argue that inadequate regulation or cybersecurity controls in current AI systems make them impossible to fully control or monitor.

Recently, former President Barack Obama criticized the argument from Trump administration officials that the free market will naturally push industry toward self-regulation and that “these companies will solve the safety issues because they have every incentive to do so.”

“If it turns out to be dangerous, people will just sue them and they’ll be worried about financial liability,” Obama said last week in remarks at Colgate University in New York. “That’s not how we treat airlines or drug companies or food companies.”

The Trump administration issued an executive order earlier this year that set up a voluntary testing regime for some commercial frontier models, largely at private industry’s discretion. That order was significantly delayed and altered by AI industry boosters to ensure that governmental review did not cause companies to postpone their release timelines for new models.

That agreement did not last long before fast-moving events caused the administration to strike another, non-public agreement with frontier AI companies like OpenAI, Anthropic and others governing pre-release testing for models.

But the Trump administration has consistently argued that regulation will harm, not help, U.S. innovation and global competitiveness, and the threat of China frequently looms large in those discussions.

Experts believe China’s AI models are behind U.S. models at the top of the market, where OpenAI and Anthropic have consistently pushed the frontier limits of model capabilities. But Chinese lower and “middle class” models are often cheaper, more efficient and can even outperform more powerful models because users can dedicate exponentially more tokens for their tasks.

The U.S. government has accused Chinese AI companies of conducting widespread, “systematic” distillation of U.S. frontier models, with the implicit encouragement of Beijing.

In defending the administration’s approach, David Sacks, co-chair of the President’s Council of Advisors on Science & Technology and a top adviser on AI issues, specifically cited the threat from China and other countries that he claimed would not be subject to similar restrictions.

“We’re not the only country that has advanced AI labs, and as the president declared…we have to win this AI race,” Sacks told Politico in May, later adding “I think that’s the first thing to recognize is that if somehow we slow down or stop AI development, it doesn’t mean that AI progress is going to stop. It just means it’s going to happen in other countries and specifically China.”

Some observers have alleged that despite their larger differences, top leaders in the U.S. and China may view AI similarly at the strategic level, specfically that increased adoption – and risks – of AI are inevitable.

Ronan Murphy, director of the tech policy program at the Center for European Policy Analysis, posited that while there may not be a formal agreement between the two countries, “they share views both in Beijing and in Washington, particularly in the White House, of: you have to allow this to happen.”

“Clearly there’s a call for regulation from many quarters of AI in the U.S. and elsewhere, but in the White House – and we heard David Sacks talking about it [recently] – It’s ‘let them cook,’ and the Chinese approach seems to be the same,” said Murphy in a press briefing. “So there might be consensus at that level, if nothing else.”

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North Korean hackers are infiltrating tens of thousands of job seekers’ computer networks by posing as prospective employers, such as artificial intelligence firms, to steal sensitive information and millions of dollars worth of cryptocurrency, U.S. and allied governments warned Friday.

The security agencies behind the alert, attributed the group, known as WaterPlum or Contagious Interview, as operating under the 313 General Bureau of the Munitions Industry Department subordinate to the Central Committee of the Workers Party of Korea. The efforts dovetail with those of North Korean IT workers.

“WaterPlum actors pose as prospective employers to target software developers and IT professionals worldwide under the pretext of attractive job opportunities,” the agencies wrote. “They often impersonate legitimate Artificial Intelligence (AI), cryptocurrency, or Non-Fungible Token (NFT) companies and have also used recruiting services.”

Additionally, “Some WaterPlum actors also operate as North Korean IT workers performing web system design and development tasks on corporate web systems for clients,” read the alert from agencies in Japan, Australia and Germany, alongside the FBI and the Department of Defense’s Cyber Crime Center.

They’ve used the stolen information to fuel other operations, and the overlap between WaterPlum and North Korean IT workers is substantial, the agencies said.

“WaterPlum actors and North Korean IT Workers used the same IP addresses when accessing laptop farms, using cloud-sourcing services, and applying for positions at the Japanese cryptocurrency exchange,” they wrote.

Collectively, WaterPlum has infected more than 30,000 devices in more than 100 countries, targeting IT professionals in Japan, the United States, Europe and other nations. Its operations have transferred the equivalent of nearly $11 million of cryptocurrency from over 7,000 crypto wallets to North Korea, according to the alert.

The law enforcement agencies said they have had some success tackling the group, but are seeking further cooperation and released details in the alert about WaterPlum’s tactics, techniques and procedures.

“For the first time in Japan, authorities successfully identified, investigated, and dismantled a ‘laptop farm’ operated by an enabler in Japan,” the alert reads. “Japanese authorities obtained evidence this cyber actor group transferred several hundred million Japanese yen in cryptocurrency to foreign locations outside of Japan. The FBI continues to identify and prosecute US-based actors providing illicit facilitation services to North Korean IT workers.”

The warning comes as the Multilateral Sanctions Monitoring Team, an international panel overseeing UN sanctions against North Korea, released a report exposing thousands of North Korean nationals employed in industries around the world.

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The Coast Guard and FBI boarded two foreign vessels coming to the United States last month to investigate potential cyberattacks on the ships, according to a joint statement from the agencies Wednesday.

The “joint offshore security boardings” of the two commercial ships in the Gulf of Mexico on Aug. 21 and Aug. 24 “were designed to ensure integrity of the vessel’s operational and information technology systems following indications that the networks of both vessels were compromised,” according to the joint statement.

“Currently, there are no reports of operational disruptions, vessel instability, physical danger to crews, or environmental impacts,” the statement reads. “The Coast Guard is actively managing communications with port operators, vessel owners, and local maritime stakeholders to ensure port operations continue safely and without interruption.”

The vessels were reportedly tankers carrying oil and natural gas, and the first got hacked in the Strait of Gibraltar and lost communication for over 30 hours. Authorities were said to be  investigating whether Iran, or perhaps another group seeking to exploit the conflict between Iran and the United States, was behind the attacks.

Coast Guard cyber teams have been investigating “dark fleets” carrying sanctioned oil from Iran and Russia, which rely on digital masking to hide their operations and carry enhanced cyber risks, The Wall Street Journal reported in June.

Then-President Joe Biden signed an executive order in 2024 giving the Coast Guard additional authorities to respond to cybersecurity incidents, citing the risks that a maritime cyber incident could cause “cascading” harm to the global supply chain.

The Aug. 21 boarding party included Coast Guard law enforcement personnel, Coast Guard Cyber Protection Team members, a vessel inspector and FBI Cyber Action Team operators, who boarded “to conduct a comprehensive cyber security boarding and investigation,” according to the agencies’ joint statement. A similar team made up the Aug. 24 boarding party.

“The captain, crew, and shore-side corporate staff were critical partners in helping to ensure the threats were mitigated,” the statement reads.

Top Trump administration cyber officials have refused to answer questions from reporters recently about Iranian cyberattacks during the Middle East conflict. Trump himself has rejected the idea that Iran was behind a recent spate of attacks on U.S. water facilities.

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 The U.S. government is accusing Chinese AI companies of engaging in a deliberate and “systematic” effort to illegally distill U.S. frontier AI models and their capabilities. 

According to a joint cybersecurity advisory from the National Security Agency, the Cybersecurity and Infrastructure Security Agency and the FBI, the sheer scale of these efforts since 2024 indicate that distillation is a critical part of China’s AI industrial policy.

“China-based artificial intelligence companies are conducting systematic extraction of proprietary functionalities and capabilities of U.S. AI companies’ models through industrial-scale knowledge distillation campaigns that form the core—not merely a supplement—of their AI development strategy,” the agencies wrote. 

The advisory names Chinese companies like DeepSeek, Moonshot AI, Alibaba, MiniMax, StepFun, and Z.AI, saying they spent billions of tokens across millions of exchanges and requests with frontier U.S. AI models like Anthropic’s Claude, OpenAI’s ChatGPT, Google Gemini, and xAI’s Grok, since at least late 2024.

The U.S. agencies said the companies used data culled from these interactions to strengthen their own domestic models, a practice that is tacitly encouraged but not directed by political leaders in Beijing.

DeepSeek, for example, distilled frontier U.S. models to generate synthetic training data for its R1 and R3 models, including four different versions of Claude, two versions of Gemini, five versions of ChatGPT and Grok 4. Those models helped train DeepSeek’s capabilities in areas like agentic functioning, question and answer optimization, creative and occupational writing and others.

Another Chinese company, Moonshot AI, allegedly distilled 18 different U.S. models – including Fable 5, Anthropic’s current, most advanced commercially available model – to train its Kimi-K2 and Kimi K3 models. The company used millions of queries meant to extract enhanced capabilities in areas like agentic reasoning, coding and data analysis, computer vision, larger logical frameworks, visual processing and others.

Chinese AI companies manage a sophisticated set of tools and systems that route requests and prompts through multiple pathways to avoid detection.

The advisory lists common tactics observed by Chinese companies, including spreading requests across different accounts, models and platforms, using native APIs, remote cloud providers, and third-party aggregators to obfuscate user metadata, and leveraging proxies and gray tech markets to get around geographic restrictions, terms of use and safeguards built into frontier models.

“Addressing industrial-scale distillation merits a coordinated response across the AI ecosystem, including effective information-sharing, spanning the U.S. Government, private industry, and allied nations,” the advisory stated.

For decades, U.S. national security officials and western business leaders have accused China of leveraging cyberattacks, insider threats and other forms of economic espionage to pilfer proprietary or sensitive technologies from U.S. businesses.

In June, Michael Kratsios, White House head of Office of Science and Technology Policy, made a similar accusation about MoonshotAI of distilling Fable 5 to train its own models, and described a similar “sophisticated” system for evading guardrails and restrictions on usage.

The warning Tuesday levies similar charges about Chinese theft of American tech, but for frontier AI companies that are facing lawsuits themselves from artists, authors, media organizations and other parties who say AI companies illegally trained their models on copyrighted or trademarked work.

Even within the competitive AI industry, companies and open-source organizations commonly share weights and measures for AI systems, or distill other AI systems in the course of legitimate work or research.

The agencies acknowledge this reality, but claim that Chinese companies are engaged in “aggressive, malicious, and targeted distillation activities at an industrial scale.”

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A group of European Parliament representatives are seeking to delay Serbia’s entry into the European Union and send other messages to Belgrade over the government’s usage of spyware.

The 29 members of the European Parliament (MEPs) cited a report this week from the SHARE Foundation about spyware found on the phones of Serbian student activists and that targeted others as well. The foundation, along with Amnesty International and The Citizen Lab at the University of Toronto, discovered both Pegasus and NoviSpy spyware infections.

The groups didn’t assign responsibility for the Pegasus infection, but said evidence from the NoviSpy infections pointed to Serbian government authorities.

“This is not a technical glitch; it is a direct state attack on democracy,” the 29 MEPs wrote Friday. “With upcoming elections ahead, Aleksandar Vučić’s regime is using illegal digital surveillance to systematically dismantle political opposition.”

The MEPs’ demands include slowing Serbian accession into the EU until completing an investigation into Serbia’s spyware usage and making Serbia’s accession contingent on improving rule-of-law accountability.

They also said President Ursula von der Leyen should cancel a planned visit to Serbia. European leaders were already outraged by the response from Serbia to the death of former Bosnian Serb army commander and war criminal Ratko Mladic, with Enlargement Commissioner Marta Kos canceling her own visit Friday over the alleged “glorification” of Mladic.

The spyware letter adds to the pressure, said Hannah Neumann, an MEP who signed it.

“It could very well be that some of these demands will be honored, but for sure the spyware won’t be the only reason why,” she told CyberScoop. Serbia’s history of spyware use contributed to Friday’s letter, she said: “We have been critical towards the government for already quite some time and demanded consequences so this was another straw.”

The Serbian government did not respond to multiple requests late Friday for comment.

“Appeasement has failed,” the members wrote. “It is time for the Commission to demonstrate that compliance with fundamental democratic standards is a non-negotiable requirement, not an option.”

European Union member nations have faced their own allegations over using spyware, and recent revelations of spyware found on the device of a member of the European Parliament’s PEGA Committee has prompted some to renew calls for enactment of recommendations from that committee to address spyware abuses.

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A cybersecurity working group at the G7 is urging governments to accelerate defenses against quantum computers that could break some existing forms of public key encryption.

The working group’s report, prepared in June at the G7 Summit in France, said organizations “can no longer afford to postpone” work transitioning critical systems and data to “post-quantum” forms of encryption.

“The quantum threat remains off the radar for many organizations and not properly resourced, with other security concerns taking precedence,” the working group report said. “Yet, a successful and collective transition to PQC can only be achieved if organizations understand that the quantum threat is an economic and business risk, and not merely a cryptographic risk.”

Instead, leaders in government and industry “must reframe the quantum threat from a distant future problem to a near-term threat that demands action across all sectors, not just critical infrastructure.”

The report acknowledged uncertain timelines for quantum computers, but identified that threats like harvesting current sensitive, encrypted data to decrypt it in the future do exist today.

The report also warned that quantum computers could compromise authentication and assurance mechanisms—by forging trusted data or stealing confirmation— jeopardizing secure communications and legal contracts.

The working group’s conclusions are largely in line with what governments have been recommending for years, urging industry to inventory and prioritize their critical systems and shift over to newer, “post-quantum cryptography” encryption algorithms.

These encryption algorithms, originally designed by independent cryptographers and vetted by the National Institute for Standards and Technology and National Security Agency, will be used to protect the government’s own systems and data from cybercriminals and foreign governments.

The Trump administration recently issued an executive order directing agencies to boost the domestic quantum industry and move up internal timelines for migrating to PQC encryption from 2035 to 2030. Google, a potential industry bellwether, and other companies have opted to move their own migration timelines to 2029.

But while that work has proceeded on schedule in some areas, like the federal government and the highly regulated financial sector, it has lagged in other industries where owners and operators feel they have more immediate concerns than quantum computers.

“We acknowledge that transitioning to PQC is not a problem for individual organizations to solve in isolation, but rather a collective transition that can only be achieved with early engagement, coordinated planning and informed decision making across the public and private sectors,” the working group wrote.

While often referred to as “Post-Quantum” encryption, the reality is more complex. Cryptographers believe the algorithms selected by NIST and NSA will stand up to attacks from a quantum computer, but since one doesn’t exist today, designing cryptographic protections against it requires some guesswork and mathematical estimation.

Estimates can be wrong, or overlook the entire cryptographic attack surface. Some NIST-selected algorithms have already been broken with traditional computers or AI. That’s why the agency backs multiple algorithms and concepts like “crypto-agility,” allowing organizations to quickly switch between them.

The G7 report was signed by the U.S. Cybersecurity and Infrastructure Security Agency (CISA), the UK’s National Cyber Security Centre (NCSC), The French Cybersecurity Agency (ANSSI), Germany’s Federal Office of Information Security (BSI), Canada’s Communications Security Establishment (CSE), Japan’s National Cybersecurity Office (NCO) and Italy’s National Cybersecurity Agency (ACN).

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A class action lawsuit filed by victims of child sexual abuse material (CSAM) accuses xAI of training Grok’s synthetic deepfake “nudify” capabilities on real images and videos of child abuse.

The lawsuit, filed Wednesday in the U.S. District Court for the Northern District of California, names Jane Doe 1 and other anonymous individuals as plaintiffs, calling Doe “an identified victim of child pornography tracked by the Federal Bureau of Investigation’s Child Exploitation Notification Program.”

Doe was a pre-school aged child when her perpetrator’s abuse began and continued for years, for the explicit purpose of making CSAM material to distribute online. Media depicting the victim has circulated online since at least the early 2000’s, with, according to the lawsuit “hundreds of thousands of files” being included in law enforcement submissions to the National Center for Missing & Exploited Children (NCMEC).

As part of the FBI’s program, she still receives updates when images related to her abuse surface online, and the suit alleges her material has “well known hash-values” that have shown up in deepfakes created with Grok and spread on X.

“CSAM depicting Plaintiff has been found on xAI as part of investigative reporting, takedown request efforts, and criminal investigations, arrests, and convictions for violations of state and federal laws,” the lawsuit states. It also claims “xAI, using Grok, has generated images depicting Plaintiff and the child pornography series in which she is the victim.”

The lawsuit cites “Masha’s Law” as the basis for its allegations. That law, passed in 2018,  protects civil legal remedies to victims of child pornography and online exploitation.

According to an analysis by the Center for Countering Digital Hate, during an 11-day period between Dec. 2025 and Jan. 2026, Grok created more than 3 million sexualized images, at least 23,000 of which appeared to depict children.

On Jan. 14, after the period tracked by the center, Musk wrote on X that he was “not aware of any naked underage images of Grok. Literally zero.” Must also implied that users, not his technology, were primarily responsible for images created using Grok while simultaneously claiming the model “will refuse to produce anything illegal” if asked.

The suit claims that while other competitors enacted guardrails to prevent their AI models from generating “nudified” images of adults and children, xAI “did the opposite,” embedding Grok and it’s deepfake capabilities directly into X, effectively creating an instantaneous CSAM generation and distribution system for the internet.

While xAI said it built in guardrails to prevent Grok from creating deepfake sexualized images, the suit notes that they are “very weak,” diverge from standard industry best practice and can be easily circumvented.

The system rejects prompt prompts where the chatbot detects “clear intent by the user in the phrasing of their request,” the complaint stated. “Indirect or euphemistic prompts can easily slip past a text-based filter, so if the model retains the underlying capability to generate sexual or abusive content, some volume of CSAM becomes effectively inevitably generated by the system.”

The lawsuit also notes that Grok’s terms of service treat anything that gets posted on X as training material, meaning any CSAM material posted on the site over the past year was likely ingested by the model.

The alleged victims are asking for monetary damages along with injunctions to prevent Grok from creating additional harm through future sexualized deepfakes or CSAM. The suit lists “thousands” of members in the class, all with similar claims against xAI.

A request for comment on the lawsuit sent to xAI was not returned.

Grok’s nudification capabilities, and xAI owner Elon Musk’s dismissive public attitude around the fallout have led to international outrage, criminal investigations and a wave of private lawsuits against the company.

Another lawsuit against X filed earlier this year claims that a man used Grok to generate thousands of instances deepfake CSAM material of his stepdaughter. That lawsuit also claims xAI withheld information from law enforcement authorities that would have helped them identify the stepfather as the perpetrator. Days after authorities traced and seized the material on the wte, he committed suicide.

In July, Musk sued Minnesota Attorney General Keith Ellison over a new state law that bans nudification technology and impose a $500,000 fine for each instance where an AI tool is used to generate or alter an image in a sexually explicit way. Musk’s lawsuit claims the ban violates the First Amendment.

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Federal authorities Wednesday revealed a multi-layered Chinese state-sponsored espionage operation that’s targeted and compromised U.S. critical infrastructure, including multiple federal agencies, since 2018. 

Officials seized domains and unsealed an affidavit detailing how a Chinese government-funded front company assembled a botnet and complementary systems that allowed attackers to intrude highly sensitive networks.

The FBI and Justice Department said the state-sponsored group, known as “QTFY,” has targeted and intruded the networks of the Departments of Energy, Justice, Health and Human Services, the Federal Reserve, NASA, National Institutes of Health, and, unsuccessfully in March, the Senate. 

Financial institutions, defense contractors, utility companies, telecom providers and hospitals have also been targeted by the threat group, which includes former members of China’s military, according to court records. 

Officials said QTFY also attempted, but was unsuccessful, in gaining access to a U.S. election system in June. 

The long-running operation, which officials obstructed by seizing malicious infrastructure, provided an expansive set of services. QTFY’s full hacking suite allowed attackers to scan and exploit vulnerabilities, infect IoT devices for a botnet, and conceal or reroute traffic.

QTFY’s operation was comprehensive with features that provided continuous reconnaissance capabilities and flexibilities designed for specific targets or objectives, said Ryan English, information security engineer at Lumen Technologies’ Black Lotus Labs, which aided the disruption efforts. 

Officials said they seized three domains, which cut off access to QScan and QTRouter, the group’s primary platforms. 

“Today’s announcement demonstrates the Justice Department’s steadfast commitment to going on the offensive against cyber threats to national security,” John A. Eisenberg, assistant attorney general for national security, said in a statement. “These court-authorized seizures deny People’s Republic of China-linked hackers access to tools they use to mount online attacks against our nation’s critical infrastructure.”

The FBI, National Security Agency and Cyber National Mission Force released a joint cybersecurity advisory with QTFY’s known indicators of compromise Wednesday. Officials also detailed the China-linked hacking group’s affiliations and collaborations with other state-sponsored groups.

QTFY targeted sensitive networks in the U.S. and globally by exploiting vulnerabilities in multiple vendors’ products, including Pulse Secure, Fortinet, Citrix, Microsoft, F5, Kentico CMS, Atlassian Confluence, Ivanti, Check Point, CrushFTP and BeyondTrust, officials said.

QScan, the reconnaissance and vulnerability scanning tool, included more than 200 proof-of-concept exploits, according to court records. 

“It was designed for large-scale deployment. On a single day in 2024 for example, QScan processed over two million scanning and exploit tasks,” a special agent for the FBI said in the affidavit.

The Chinese hacking collective exploited multiple Ivanti zero-day vulnerabilities in September 2024 to intrude the networks of three DOE national laboratories, NIH, an HHS agency and a U.S.-based security device manufacturer. Officials said the seized domains were all used in those attacks. 

The FBI has been investigating QTFY, which operated out of a private China-based front company, Nanjing Xinjiuwei Network Technology Company, since at least 2019. The group has been consistently active for more than eight years. 

“Discovery of these private companies building networks for China is becoming more frequent,” English said. “We’re starting to see that when they’re getting exposed, some of these have been in business a few years before they’re found.”

The takedown follows a series of technical operations aimed at dismantling China state-sponsored attackers’ infrastructure, including an operation in early 2025 that allowed officials to remove PlugX malware from thousands of U.S.-based computers.

“State-sponsored malicious hackers preying on America’s critical infrastructure will be stopped and prosecuted,” Attorney General Todd Blanche said in a statement. “We are here to ensure security for the American people and will use every tool we have to keep that promise.”

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An international law enforcement operation carried out against organized crime groups in West Africa resulted in 58 arrests and identified 263 suspects, Interpol announced Tuesday.

The operation, known as Operation Jackal IV, aimed to disrupt money laundering, locate high-value targets, seize assets and support prosecutions tied to various Africa-based criminal groups, including Black Axe. 

Black Axe is a highly structured, hierarchical group that generates billions of dollars in criminal proceeds annually from many small-scale operations spanning dozens of countries. The group’s leaders are Nigerian nationals, according to a Europol release issued earlier this year. In January, European law enforcement arrested dozens of the group’s members for adversary-in-the-middle scams such as business email compromise, money laundering and vehicle trafficking. 

“Operation Jackal IV demonstrates the power of international cooperation,” Tomonobu Kaya, director of Interpol’s Financial Crime and Anti-Corruption Centre, said in a release. “By following illicit financial flows across borders, we are attacking the very lifeblood of organized crime and making it increasingly difficult for criminal networks to profit from their activities.”

The agency said it will continue to work to unravel the full details of each case, but detailed several preliminary discoveries from partner organizations Tuesday.

Romanian authorities broke up a group that ran an investment scam from a call center promising high returns in stocks or cryptocurrencies. Victim payments were routed to electronic wallets controlled by the operators, with police estimating the full value at 143 million euros (approximately $166 million). They arrested 11 people and seized about 330,000 euros ($379,000) in cash and cryptocurrency, six properties and several luxury watches.

In South Africa, where 39 of the 58 arrests occurred, police raided seven sites in Johannesburg tied to a syndicate that targeted retirees in English-speaking countries with romance and investment scams. Investigators seized $2.67 million and blocked 257 bank accounts.

Authorities in Argentina identified 196 people linked to a Crime-as-a-Service network suspected of supplying website domains and laundering support to West African groups, making 17 arrests. 

In Italy, one person was identified in connection with a pan-European laundering network built on shell companies, remittance services and cash withdrawals. A single account moved 845,000 euros ($736,000) through 560 transactions.

Investigators also noted the group’s growing focus on sextortion, with victims as young as 14. Similar to actions taken by The Com, Interpol says offenders are contacting teenagers on social media, coercing them into taking explicit images, then demanding payment to keep the material private.

This is not the first time Interpol has taken measures to disrupt African-based groups. In 2024, a similar Interpol operation led to 300 arrests, $3 million in assets seized and 720 blocked bank accounts.

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As part of its “economic D-Day” against Iran, the Treasury Department designated four Iranians for sanctions Monday stemming from their alleged role in hacking critical infrastructure targets and waging cybertheft against the United States.

It’s the second time in as many weeks that the Trump administration has taken aim at the same group of alleged hackers, following on an indictment recently unsealed against cybercriminals that federal law enforcement authorities say are affiliated with the Tehran-based Mabna Institute.

A Treasury Department release points the finger at three people — Keyvan Fayyaz Ghareh Blagh, Saber Shahbazi Balujeh, Mohammad Reza Kadkhoda’i and Mojtaba Ghal’eh-Kuhi — as specifically conducting the hacks.

“Since at least late 2023, these three individuals have successfully compromised and exfiltrated data from multiple U.S. companies in various critical infrastructure sectors, including energy companies, defense contractors, healthcare institutions, information technology companies, and financial institutions,” the release states.

A fourth individual included in Monday’s sanctions, Mojtaba Ghal’eh-Kuhi, is listed as one of the leaders of the gang carrying out the Ministry of Intelligence and Security (MOIS)-directed attacks. Another listed leader, Behzad Mesri, first faced sanctions in 2018, as part of another round of sanctions focused on the Mabna Institute.

Finally, the Treasury Department designated one additional person Monday over related activity, Arman Kahzadian, for his alleged role in receiving or using business information stolen via cyber-enabled means.

The department said the Iranian hackers sometimes turn their gaze to domestic targets.

“The members of this group are also heavily motivated by personal enrichment and greed, leading some members to prioritize their own profits over operations that benefit the MOIS,” it said. “This has driven some of the group to target Iranian companies.“

Hackers that the U.S. government has identified as Iranian have been behind a spate of attacks on U.S. water facilities, despite denials from President Donald Trump himself about Iranian culpability.  The Treasury Department did not immediately respond to a request for comment Monday about whether the sanctions designees were involved in those attacks, nor has the National Security Agency responded to requests for comment on whether Iran was responsible for attacks at the center of an alert about attacks on water facilities.

Treasury Secretary Scott Bessent announced a fuller list of sanctions Monday as the war with Iran nears its five-month anniversary with no end in apparent sight.

“In the Second World War, D-Day marked the historic beginning of a campaign with our allies to target and drive the enemy from its positions, including those in third countries,” he said. “Today, in that same spirit, we are launching an economic onslaught against Iran’s financial connections around the globe. Our objective is to sever every economic lifeline that sustains this tyrannical regime until Tehran stands alone.”

There are questions about whether the sanctions themselves are likely to change any behavior, particularly based on how they will be enforced. Iran has vowed “consequences” for the United States.

As part of the sanctions announced Monday, according to the department, “Treasury is expanding the categories of Iran-related conduct that may be subject to secondary sanctions in the future, making it easier to take action against those facilitating the regime. Treasury has issued determinations against five critical sectors –– digital assets, technology, gold, aviation, and shipping––  that the Iranian regime uses to try to prop up its failing economy.”

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Federal authorities on Tuesday unsealed an indictment against 17 Iranians affiliated with the tech firm Mabna Institute, alleging a campaign of vast cybertheft on behalf of the Iranian government against universities, governments and companies.

It’s a second wave of indictments against the Tehran-based firm, expanding on and replacing a 2018 indictment of nine of the defendants from then and adding others. 

“Today’s charges, which include eight additional defendants, reveal the broader network allegedly behind a sweeping, state-sponsored campaign to steal research and intellectual property from American universities, businesses, and government institutions,” said Jamie McDonald, U.S. Attorney for the Southern District of New York. “More than eight years after making the original indictment public, these charges make clear that the passage of time will not deter us from identifying and pursuing those who target the United States from abroad.”

Unlike in 2018, the United States is currently waging a war against Iran that recently saw a 60-day negotiation deadline pass with no progress.

“Cyber operations have become a central instrument of national power, and attacks on American and allied institutions carry direct consequences for our security and economic strength,” McDonald continued.

According to the Justice Department, Gholamreza Rafatnejad and Ehsan Mohammadi founded the Mabna Institute around 2013 with the goal of helping Iranian universities and scientific and research organizations to steal from foreign scientific efforts. In doing so, it paid hackers-for-hire listed in the indictment.

The institute has compromised more than 100,000 professors’ email accounts globally, the indictment alleges, and successfully compromised 8,000 accounts at 144 U.S. universities and 178 universities in other parts of the world.

Its hackers used stolen credentials to take academic journals, dissertations and e-books across all fields of research, at least 31.5 terabytes worth in total. The institute sometimes sold stolen data, according to the indictment. 

“Through the course of the conspiracy, U.S.-based universities spent more than approximately $3.4 billion to procure and access such data and intellectual property,” a press release on the indictment states.

The defendants also have compromised and stolen from email accounts for at least five U.S. federal and state government agencies, 42 U.S. companies and 11 foreign companies, among them HBO. 

In all, the indictment brings 14 separate, sometimes overlapping charges against the 17 defendants, with sentences for each offense ranging from two to 20 years.

In conjunction with the indictment, the State Department’s Rewards for Justice program is offering up to $10 million for information leading to the location of four of the defendants.

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The ransomware-as-a-service group Medusa has adopted fresh tactics to gain access and added hundreds of victims in a little more than a year, according to an updated U.S. government advisory published Tuesday.

The gang is relying on access brokers,compensating them anywhere from $100 to $1 million, with higher prices going to those who work exclusively with Medusa. However, most of the brokers work simultaneously for “multiple variants at the same time,” the advisory from the Cybersecurity and Infrastructure Security Agency, FBI and Health and Human Services Department states in one of the updated portions of the advisory.

Tuesday’s update advisory expands upon aMarch 2025 advisory, drawing on ongoing FBI investigations.nIt includes information on the kinds of software vulnerabilities Medusa has exploited, such as Fortra GoAnywhere and BeyondTrust flaws.

“Medusa actors operate opportunistically by targeting victims with unpatched software rather than focusing on specific organizations or sectors; however, the Healthcare and Public Health (HPH) Sector has been a frequent victim of Medusa operations,” according to the advisory. “Medusa actors leverage newly announced exploits within 24 hours and have been observed to use exploits up to a week before public vulnerability disclosure.’

“However, there is no indication Medusa actors develop their own zero-day or N-day vulnerabilities, preferring instead to obtain advanced access to exploits from unknown sources or to quickly leverage newly announced exploits before potential victims can mitigate vulnerabilities through patching,” the advisory continues.

The approach appears to be netting gains: From March 2025 to April of this year, the victim tally in the advisory jumped from more than 300 to more than 500. The group was first identified in 2021.

“Medusa actors often use legitimate tools and living off the land techniques to evade detection. They may also leverage remote monitoring and management software and remote access services, including Remote Desktop Protocol, for lateral movement,” as updated sections of the advisory detail. “Once inside a network, they use common utilities and tools to support credential access, data exfiltration, and ransomware deployment.”

Earlier this year, Microsoft detailed how a group it dubbed Storm-1175 was making use of Medusa ransomware in speedy operations. Symantec and Carbon Black also detailed earlier this year how North Korean hackers were leaning on Medusa to target the health care sector.

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A newly-signed presidential memorandum enlisting private sector companies in federal law enforcement hacking operations against criminal organizations could present a number of legal, practical and moral pitfalls, cyber experts told CyberScoop a day after the order was released.

While some have celebrated the memo as an overdue maneuver to more aggressively combat cybercriminals, others view it as risky at best and potentially destructive at worst. Supporters, critics and everyone in between also said that how it plays out could be decided in the 60-day timeframe the memo sets to establish the program.

But ultimately, “it’s a massive shift in the cyber policy community,” said Michael Garcia, a former top official at the Cybersecurity and Infrastructure Agency. “This is a philosophical shift.”

The Concerns

On the most critical end of the spectrum is security consultant Davi Ottenheimer, who has been a proponent of concepts like “hack back” or “active defense” that envision a bigger role for the private sector. But he was unsparing in his criticism of the Trump memo. 

“It’s an embarrassment to America,” he told CyberScoop. “It’s like seeing somebody strapped onto a horse backwards, looking at the wrong end of a rifle.”

The Trump memo’s approach has been likened to the “letters of marque” concept used in early U.S. history, when it authorized sea privateers to attack and capture enemy ships and goods on behalf of the country. But Ottenheimer, founder of Ottenheimer GmbH, noted that the practice fell out of favor for good reason in the 1800s because of the violence it unleashed and how it contributed to mercenarism.

Additionally, the memo raises a number of targeting-related issues, he said. Ottenheimer is concerned about Trump’s intentions. The memo specifically pertains to the use of participating companies against transnational criminal organizations.

“Left-wing opposition, liberals, anti-fascists —they’re all criminals to him,” Ottenheimer said. “So to authorize attacking criminals under this means private organizations can go hack people that he designates as criminals.”

Under the memo, the program must establish legal and constitutional procedures for the prior approval of the targeting of U.S. citizens, as well as develop procedures to halt any unintentional targeting of U.S. people or systems. 

However, the limitation on targeting criminals only creates a perverse incentive for attackers and a peculiar defense for anyone who’s attacked, Ottenheimer said.

He envisioned a scenario for a company participating in the program where “you’re hacking [a target], and they go, ‘Hey, we’re the state.’ And then [private companies] are like, ‘Oh, I can’t hack you anymore.’ Boom. They decided when you can and can’t hack.”

Furthermore, “you incentivize people to know as little as possible so [operations] can be authorized,” he said.

The memo raises ethical concerns for him as well: “You can’t attack somebody and then say it’s your fault that you didn’t notify them you didn’t want to be attacked.”

“There’s no notice for you being designated. There’s no prevention of you being designated. There’s no way for you to know you’re being designated,” Ottenheimer said. “That’s like a person sitting down next to you and smoking a cigarette and blowing smoke in your face and saying, ‘Hey, you got to say you don’t like cancer if you don’t want me to do this to you right now.’”

Garcia, now vice president of the cybersecurity practice at Monument Advocacy, said he supports some of the ideas of the memo, but worries about how it will be executed.

“It comes down to attribution, and if you make a risky bet on who we’re attributing [attacks] to, that’s where things can get dicey,” Garcia told CyberScoop.

There could be pressure to attribute faster, which could perhaps lead to lower certainty about who’s being targeted, and that in turn could lead to a private sector company accidentally attacking a foreign government, he said.

That raises legal questions: “It’s in the Constitution —the federal government has the ability to wage war. And there are laws by which private citizens can’t take up arms,” Garcia said.

He wanted the memo to include court oversight of the program, similar to what’s been required for private sector takedown operations. .

Garcia also isn’t sure whether there will be a big enough pool of companies willing to jump into offensive cyber operations.

“From the lawyer perspective, it’s, ‘Are you okay with engaging in this kind of legal risk? And who knows what protections the government will provide?’” he said. “I’d be very curious to see what the foreign governments’ reactions are — ‘We’re going to cut ties with any participating company that engages in this.’”

Errata Security CEO Robert Graham wrote that under the program, companies “are not willy-nilly hacking back,” given the federal supervision elements. “Though, I wonder if it doesn’t eventually morph into law enforcement saying ‘Stop bothering us, just do what you think is best.’’” 

The Case For

The Trump administration and the memo’s supporters  have touted it as a means to put the United States on stronger ground in cyberspace. 

Amanda Naylor, the director of cyber policy at the National Security Council who worked on the memo, said on LinkedIn that it was designed “to bring the capabilities, speed, and innovation of the American private sector into the fight against transnational cybercrime and fraud.”

Former Trump White House cybersecurity official Joshua Steinman said he views the memo as a step toward “parity,” given how U.S. adversaries operate in cyberspace.

“The Chinese and the Russians do this at scale, and I guarantee you they have very few limiting tools when they do it,” said Steinman, now founder of the security firm Gavalnick. “It opens up an entire workforce that allows us to go out and achieve strategic objectives.”

The restrictions in the memo are important, he told CyberScoop.

“The most sensitive things are going to continue to be done by the uniformed and authorized civilian workforces, but there’s a lot of low-hanging fruit,” i.e., criminal organizations, Steinman said. He doesn’t have any fear of the program overstepping as a result.

“We operate like a Boy Scout in cyberspace,” he said. “It’s measured and reasoned.” He compared it to the Right to Try Act for medications.

He also said he expects to see a lot of interest in participating in the private sector.

Ari Redbord, global head of policy at TRM Labs, praised the memo too, calling it “a huge step toward empowering the private sector at a critical moment” that “has a real opportunity to be truly transformative.”

“Scammers are using AI to move with unprecedented speed and scale, stealing billions in life savings from average Americans and small businesses,” he said. “The private sector holds the data. The public sector holds the authorities. This [memo] puts them together.”

What’s Next

The coordination center charged with establishing the program under the memo has 60 days to complete its work. That process could determine a lot. Graham noted that the memo has a classified annex, too.

The memo as written is quiet about what becomes of any seized assets, Graham noted. Redbord raised the same topic as one of his questions about execution of the memo. 

“What government direction and control looks like in the middle of a live operation,” he said in listing his questions. “How disruption turns into actual dollars back in victims’ pockets, and whether we can build a true victim compensation fund as part of this program. What happens when an operation touches a third country with its own laws and its own interests. And how success gets measured, in money recovered and networks dismantled.”

Will Barker, cybersecurity adviser at Huntress, said what’s next could be key.

“The 60-day implementing guidance is where the real substance lives,” he said in a written quote. “Minimum standards, operational procedures, the adjudicatory framework for target selection.”

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Suspected Chinese hackers used open-source artificial intelligence models to run a cyberattack against the Taiwanese government in the first publicly known case of an autonomous AI hack hitting a government target, according to research published Wednesday.

The hackers extracted more than 2,500 personnel records, among other data, in the “near-autonomous attack,” researchers at Israeli cyber firm Dream wrote in a blog post. The attackers set up the framework so that it could “adapt mid-operation without human intervention.”

The framework “implements dedicated research phases it calls ‘Learning Cycles’ — autonomous sessions where the AI system searches vulnerability databases, GitHub repositories, and security research publications for techniques specifically applicable to its target government’s infrastructure,” the post reads.

And then it kept going.

“The attacker didn’t stop at primary targets,” Dream said. “It expanded the operation to government IT supply chain vendors, a nuclear safety agency, a government email system, and 7+ energy sector companies — scanning them all in parallel for misconfigurations, exposed admin interfaces, and exploitable vulnerabilities.”

It also learned from its mistakes as it went on, Dream said in identifying what stood out about the campaign.

Autonomous AI-powered cyberattacks have raised alarms in the past: Anthropic reported last fall that it stopped the first autonomous cyber espionage campaign, although researchers noted that the “autonomous” campaign still required significant human work. 

The Financial Times first reported the Dream research and details on the target.

The hackers used two popular open-source AI frameworks, Hermes and OpenClaw, to set up the Taiwan operation. They bypassed safety guardrails by framing the work as authorized penetration testing, according to Dream.

The firm discovered the operation via an online archive of 160 megabytes and nearly 1,400 files, revealing “a multi-agent AI system that achieved confirmed, real-world compromises against state infrastructure.”

As with the autonomous cyber espionage campaign uncovered last fall, the attack Dream examined also noted the need for human tinkering.

“We increasingly see threat actors leveraging AI for autonomous offensive operations,” the company wrote. “But building a system that actually works at this level takes more work than ‘just’ running a model. It demands careful adjustment to the specific task, optimization of agent coordination, and fine-tuning of decision logic — the kind of sophistication evident in this framework’s Bayesian prioritization, self-correction loops, and adaptive research cycles.”

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President Donald Trump blamed Minnesota Friday for the cyberattacks its water systems have suffered in recent days, saying the state was “behind it.”

Trump said the state being “incompetent” was the issue, but it wasn’t clear whom he thought actually conducted cyberattacks that U.S. investigators have attributed to Iran — if, perhaps, somehow Minnesota incompetently cyberattacked itself. The White House referred a request for clarification back to Trump’s remarks.

“I think that Minnesota is behind it,” Trump told reporters Friday. “Because they’re grossly incompetent. I don’t think there was an Iranian cyberattack. I think Minnesota ought to get its act together.”

The White House also didn’t clarify whom the president believed was behind similar attacks in other states, when asked for comment. Trump has repeatedly used federal power aggressively in Minnesota, a state led by Gov. Tim Walz, a Democrat who was on the ticket that ran against him in 2024 as the vice presidential nominee. Trump also has downplayed Iranian attacks amid the war he launched against the nation with Israel in February.

A number of cyber experts quickly pushed back on Trump’s comments after he made them.

“Victim blaming in cyber is so 2000 and late,” cybersecurity pioneer Chris Wysopal, Veracode co-founder and chief security evangelist, said on the Bluesky social media platform. Said Jake Williams, a member of the IANS faculty: “His own intelligence services are attributing this to Iran.”

Andy Jabbour — founder and CEO of Gate 15, a cybersecurity firm which provides support to the water sector — told CyberScoop that, “speaking candidly, I’m not even sure what he was actually saying or suggesting Minnesota’s government did or didn’t do.”

“Attribution is tricky business,” he continued, referencing recent alerts from the Cybersecurity and Infrastructure Security Agency and others. “But logically, given an ongoing war with Iran, recent statements made by Iran-aligned threat groups, with assessments that the recent activity is aligned with recent CISA warnings, given yesterday’s statements from CISA and the FBI, random unsubstantiated allegations aimed at political opponents seem reckless and are a disservice to the American people.”

Walz struck back at Trump in a Facebook post, noting steps from his Department of Government Efficiency to slash federal funding. CISA has shrunken considerably under Trump, and his administration has pushed states to defend against cyberattacks that feds once countered.

“Trump knows exactly who is responsible for this attack, and knows that other states were hit too,” Walz said. “This is what modern warfare looks like, and it further illustrates there’s no plan to win a war with Iran.”

“DOGE took an axe to CISA and left the U.S. exposed to cyber attacks,” he continued. “Thankfully, our experts in Minnesota were able to identify the vulnerability quickly and work with local communities to stop it.”

A spokesperson for Minnesota IT Services, a state agency that has been responding to the water cyberattacks, declined to address Trump’s remarks.

“We remain focused on supporting affected communities, securing critical infrastructure and coordinating with local partners and federal officials as the investigation continues,” the spokesperson, Emily Zimmer, told CyberScoop. “We will not comment on political statements or speculate about attribution.”

Other cyber professionals declined to comment directly on Trump’s remarks, but offered thoughts on who was behind the attacks and their motives.

Bryson Bort, CEO and founder of Scythe said the evidence supports the attribution with Iran, and that it looks like hackers there found something they could exploit on the internet and seized the chance.

“This was a target of opportunity,” said Bort, co-founder of the ICS Village, a non-profit advancing awareness of industrial control system security; such systems are common in the water sector. “It wasn’t that Minnesota did something as a state to raise Iran’s ire.”

Cynthia Kaiser, a former top FBI cyber official, said that when the bureau conducts attributions, it looks at technical indicators but also who has the capability, who has conducted similar attacks in the past and what the purpose of the attacks is.

“Iran ticks all these kinds of things,” Kaiser, now senior vice president at cybersecurity firm Halcyon, told CyberScoop. “My view is, if it walks like a duck, if it talks like a duck, I strongly suspect it’s a duck. I’d be shocked if we found out it wasn’t Iran.”

Just last week, CISA updated an advisory about how Iranian hackers were targeting programmable logic controllers in the water sector and other sectors, a warning that the water industry’s information sharing and analysis center said it believed.

“WaterISAC is confident in our government partners’ assessment that the confirmed activity is aligned with the joint Cybersecurity Advisory (CSA) AA26-097A ‘Iranian-Affiliated Cyber Actors Exploit Programmable Logic Controllers Across U.S. Critical Infrastructure’ published and recently updated by CISA,” Tom Dobbins, executive director, WaterISAC, told CyberScoop. “We have evidence of earlier attacks from Iran even before this current conflict. Cyber attacks are the most viable way that Iran can directly attack our homeland, and it is logical that they would do so, especially given the challenges of absolute attribution.”

The water sector is often viewed as one of the most vulnerable critical infrastructure sectors, and Dobbins called on Congress to provide funding to provide funding for the ISAC.

Sen. Tina Smith, D-Minn., also took issue with Trump’s comments.

“The President provided an unserious response that is beneath the dignity of the office he holds. Iran’s purported cyberattack on Minnesota’s water infrastructure must be taken as a serious threat to our national security.  Smith said in a statement, adding that she’s been in touch with CISA and the FBI and was grateful to Minnesota’s IT experts. “The entire situation serves as a stark reminder of the danger this war puts us in the longer it drags on.”

Fellow Minnesota Democratic Sen. Amy Klobuchar had earlier been in touch with Sean Cairncross, the national cyber director and a Minnesota native, about the incident.

Trump has previously displayed a laissez-faire view toward other cyberattacks on the United States, such as when he’s been asked about Chinese and Russian cyberattacks and Trump shrugs them off as something America does, too.

He also has cast doubt before on his government officials’ assessments of who’s responsible for cyberattacks on the United States, such as when he asserted China rather than Russia was behind the landmark SolarWinds breach.

Updated 8/3/2026: with comments from Minnesota’s senators.

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Microsoft, along with more than two dozen tech companies, are pressing policymakers to support open-source AI systems and code across society, arguing that it will be a safer approach than attempting to restrict access or relying on a handful of closed, proprietary models.

The open letter, posted Friday, draws parallels to the software industry of the 1980s, when large businesses worried that open-source software code would cut into their business. While industry lost that battle, the end result was a vibrant ecosystem that now underpins much of the modern internet, government IT and even commercial software products.

It also created a “shared foundation of knowledge” that has fed countless future software projects and innovations.

“The United States now faces a similar choice with artificial intelligence,” the companies wrote. “Our AI leadership will be judged not by one frontier AI model, but by whether the United States builds a strong, open ecosystem that diffuses into every sector.”

Expanding access and support to open-source AI comes with meaningful security risk. Cybersecurity experts warn that one of the biggest beneficiaries of broadly available AI tools are  low-level criminals who until now lacked the technical expertise or resources to launch serious attacks.

Once a model is open weight, anyone can download it, customize it, strip it of any guardrails and use it for their own purposes. As open-source models have gotten better at creating deepfakes and other AI generated imagery, the danger of locally-customized CSAM and sexualized deepfakes could also grow.

But the letter argues that open-weight AI models are most beneficial to startups, universities, research labs and other small, ambitious organizations that can innovate and iterate the technology and make it more broadly useful to society.

“Open weights let every organization match the right model to the right job at the right cost, reserving frontier-scale capability for genuine frontier problems and running efficient specialized specialized models everywhere else,” The companies wrote. “That discipline is what will make AI economically sustainable as its use scales into the billions of everyday tasks.”

 For cybersecurity specifically, the letter argues that defenders armed with open-source AI will outpace attackers better than any closed model approach.

“In a world where cybersecurity attackers use advanced AI, defenders need access to models with comparable capabilities so they can detect, simulate, and respond to emerging threats,” the companies wrote. “Open models broaden defensive capability, increase transparency, and allow vulnerabilities to be discovered and remediated across many teams.”

Other notable companies signing the letter include Meta, Palantir, Perplexity, Mistral, NVIDIA, Mozilla, The Linux Foundation, Hugging Face, Dell Technologies and IBM.

US policymakers continue to grapple with balancing unrestrained support for the domestic AI industry and providing oversight and regulation of harms that result from their use.

The Trump administration has cycled through several frameworks since coming into office, first a laissez-faire approach within no restrictions, then an executive order creating a voluntary testing regime for industry, then the imposition of export controls on Anthropic’s Fable model and reportedly pressuring OpenAI to delay the release of their models out of cybersecurity concerns.

The letter comes as the Trump administration has reportedly considered an executive order that would restrict American access and availability to Chinese-made open-source models.

But the White House and US companies are trying to thread a needle in recognizing the overall benefits of an open source approach while being wary of doing anything that could potentially benefit their Chinese rivals.

Earlier this month the White House announced the creation of its Gold Eagle AI cybersecurity clearinghouse that would help coordinate government, private sector and civil society work finding and closing AI-discovered vulnerabilities. A big part of that effort, a senior White House official said, is supporting providers and maintainers of open-source AI tools.

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The State Department will restrict visas for cybercriminals like scammers to sextortionists, and in some cases even their family members, Secretary of State Marco Rubio said Thursday.

The Trump administration has sought to make a crackdown on foreign-based scams one of the signature issues of his second term. An executive order that the president signed in March indicated that visa restrictions would be on the table as one response.

“By restricting visa issuance to those who are responsible for or complicit in these criminal enterprises, we are sending a clear message: The United States will go after those who prey on our citizens,” Rubio said.

Other departments have also made efforts to reduce foreign-run scams. In June, the Department of Justice seized infrastructure used by subsidiaries of the Huione Group, a Cambodia-based corporate conglomerate tied to one of the world’s most prolific criminal marketplaces used to commit cyber scams and other crimes.

Rubio authorized the visa restrictions under a 1952 law that gives the State Department the ability to deport or rule as inadmissible someone who poses “potentially serious adverse foreign policy consequences.”

Critics have accused the Trump administration of abusing that provision of the law for political purposes.

Rubio’s statement on the visa restrictions mentions “individuals responsible for, or complicit in, cybercrime and cyber-enabled crime, such as those involved in cyberscams, and sextortion.”  Furthermore, he said, “Immediate family members of individuals engaged in such illicit activities may also be subjected to visa restrictions.”

Betsy Cooper, Founding Director of the Aspen Policy Academy, said the visa restrictions on cybercriminals could be valuable, but offered a caveat.

“Scamming people is a growing global enterprise, and it is a laudable goal to penalize those who scam and defraud people since they so rarely suffer consequences for their actions,” she said in a statement to CyberScoop. “So long as the new visa controls are used narrowly and deployed only against verified scammers and fraudsters, this is a positive step toward combatting cyber-enabled crime.”

While some cyber experts have questioned how much visa restrictions, prosecutions and other punishments of cyber miscreants who are based overseas will affect them, others maintain that it can serve as a deterrent to those who would consider getting into the line of work but want freedom to travel the globe.

FightCyberCrime.org, a nonprofit that seeks to help cybercrime victims, applauded the restrictions on the cybercriminals.

“We welcome efforts to hold cybercriminals accountable across borders. Cryptocurrency investment scams, romance scams, and sextortion cause devastating financial and emotional harm to victims,” it said in a statement to CyberScoop. “Meaningful disruption of these transnational criminal networks is an essential part of the response.”

But there’s still a long way to go in the fight, the statement continued.

“At the same time, we must invest more in victim support, prevention, and recovery resources,” the organization said. “Accountability is critical, but ensuring victims have access to trauma-informed support and resources is equally important.”

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A Russian state-sponsored threat group has been stealing sensitive data from governments and commercial organizations since July 2025 via a novel exploit in popular Linux-based enterprise software, U.S. authorities and cyber officials from more than a dozen other countries warned in a joint cybersecurity advisory Thursday.

Laundry Bear’s most recent espionage campaign involves the exploitation of a zero-day vulnerability in Zimbra Collaboration Suite that wasn’t patched until November 2025, five months after attacks were well underway, officials said. 

The exploit just requires a view — no clicks — and allows attackers to steal the previous 90 days’ worth of email, the account’s password, search history, the victim organization’s email directory, two-factor authentication tokens and other newly created passwords.

“The covert and persistent nature of this activity, along with the absence of any known financial extortion, almost certainly indicates this group’s involvement in espionage activities with Russian government backing,” officials wrote in the advisory. 

“Additionally, extensive Ukrainian targeting, prior to use against U.S. and other NATO allies, outlines an increasing trend within Russian cyber threat groups to target Ukrainian users first—both as a priority target and as a testbench for malicious cyber techniques before broader global deployment.”

The state-sponsored espionage group, also known as Void Blizzard, has compromised governments and organizations in the defense, education, energy, law enforcement, media, finance, transportation and technology sectors. 

Laundry Bear’s year-long campaign involving the exploitation of CVE-2025-66376 showcases more technical capabilities, including a custom JavaScript payload it delivers to targeted victims via phishing emails. The threat group could also likely adapt the novel data exfiltration and aggregation capability, dubbed “beehive,” to exploit other vulnerabilities, officials warned.

The defect’s medium-severity rating of 6.1 underscores the challenge defenders regularly confront in prioritizing patching schedules based on measure of severity alone.

The Russian state-supported group, which has been active since at least 2024, is still actively exploiting Zimbra Collaboration Suite instances that remain unpatched, officials said.

Authorities shared Thursday indicators of compromise, mitigation steps and urged organizations to update their vulnerable software.

“This campaign’s targeted victimology and limited exploitation capabilities likely indicate this group manually identifies and targets the victim organizations” by identifying organizations with public-facing infrastructure, officials wrote in the advisory.

Once a target is identified, Laundry Bear also likely compiles email addresses for users to target with the exploit via phishing emails. Officials did not identify specific victims or describe the volume of organizations already compromised.

The joint cybersecurity advisory was issued by the United States, Australia, Canada, New Zealand, the United Kingdom, Czech Republic, Denmark, Estonia, Finland, France, Italy, Moldova, the Netherlands, Poland, Spain and Sweden.

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A top White House technology official is accusing a Chinese company of distilling Anthropic’s models to create their own AI product.

Michael Kratsios, who leads the White House Office of Science and Technology Policy, claimed that Moonshot AI, a Beijing, China-based AI company, had distilled Anthropic’s recently-released Fable model to develop its own K3 model.

“To do this they developed a sophisticated internal platform to conduct large scale distillation against U.S. models, allowing them to quickly switch between multiple methods of access to avoid detection,” Kratsios wrote on X Wednesday.

Kratsios also said the company has used GB300 servers – either newly acquired or through Thailand – to train its AI models.

“The United States strongly supports the free and fair development of AI, including a thriving competitive ecosystem that spans frontier models, specialized systems, open-source frameworks, and open-weight models,” Kratsios continued. “Legitimate AI distillation used to create smaller, more efficient models plays a vital role in this open innovation ecosystem. However, large-scale, covert industrial distillation aimed at stealing proprietary U.S. technology and undermining American research is unacceptable.”

Kratsios did not provide details on how the U.S. government learned that K3 had been distilled from Anthropic’s model. 

Frontier AI companies in the U.S. have pressed policymakers to make it more difficult for third-parties to copy or duplicate advanced commercial models, calling it a form of intellectual property theft.

On their website, Moonshot AI describes its Kimi K3 model as the first open 2.8 trillion parameter model, and promotes its lower token costs while still delivering near-frontier performance. 

“While its overall performance still trails the most powerful proprietary models, Claude Fable 5 and GPT 5.6 Sol, Kimi K3 demonstrated frontier-level performance across our evaluation suite, consistently outperforming other tested models,” the company said on its website. 

A request for comment sent to Moonshot AI was not returned before this article’s publication. 

Piyush Sharma, CEO of Tuskira, an AI cybersecurity detection and response company, said distillation of AI models allows developers many of a model’s core capabilities. He pointed to another example when Anthropic earlier this year accused Chinese company Alibaba of distilling their Claude AI model.

According to Anthropic, the campaign used 25,000 fraudulent accounts to run 28.8 million interactions on Claude over six weeks. Given that kind of volume “the goal was clearly replication,” he said. 

“When a model has learned to reason through software weaknesses, security gaps, and attack paths, copying its behavior also copies that analytical capability,” said Sharma.

In April, Rep. Andrew Garbarino, R-N.Y., who chairs the House Homeland Security Committee and Rep. John Moolenaar, R-Mich., Chair of the Select Committee on China, announced they were conducting a joint investigation into the integration of Chinese AI models.

The committees said the inquiry will also focus on “examining a pattern of conduct by [Chinese]-based AI laboratories involving the large-scale theft of proprietary capabilities from American frontier AI systems through adversarial distillation” as well as “ the redistribution of those stolen capabilities as open-weight models available for global download, and the incorporation of PRC-origin models into products used daily by hundreds of thousands of American developers and engineers.”

Western governments and industry accuse Chinese companies of routinely stealing their technology, intellectual property and other trade secrets, often with the tacit support of Beijing. The copying of AI models would continue a long and established tradition of Chinese-sponsored intellectual property theft.

However, while distillation attacks by foreign governments or companies on U.S. frontier companies can have real national security implications, it’s still a fraught question of where policymakers should draw the line.

The AI industry, which includes not just frontier companies but large businesses with their own bespoke models, smaller proprietary startups and a vibrant open-source ecosystem, routinely share and use third-party data, including critical code and training sets for AI models.

Further, U.S. frontier AI companies have built and trained their world leading models in large part by crawling the open internet, ingesting content created and produced by others. Critics (and multiple ongoing lawsuits) argue that AI companies like OpenAI and Anthropic built their empires on data and content from others, taken almost entirely without consent or compensation.

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