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+ - SECURING U.S. SURFACE TRANSPORTATION FROM CYBER ATTACKS
+
+[House Hearing, 116 Congress]
+[From the U.S. Government Publishing Office]
+
+
+
+
+
+
+
+ SECURING U.S. SURFACE TRANSPORTATION FROM CYBER ATTACKS
+
+=======================================================================
+
+ JOINT HEARING
+
+ before the
+
+ SUBCOMMITTEE ON TRANSPORTATION AND MARITIME SECURITY
+
+ and the
+
+ SUBCOMMITTEE ON CYBERSECURITY,
+ INFRASTRUCTURE PROTECTION,
+ AND INNOVATION
+ HOUSE OF REPRESENTATIVES
+
+ ONE HUNDRED SIXTEENTH CONGRESS
+
+ FIRST SESSION
+
+ __________
+
+ FEBRUARY 26, 2019
+
+ __________
+
+ Serial No. 116-2
+
+ __________
+
+ Printed for the use of the Committee on Homeland Security
+
+
+
+
+
+
+[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
+
+
+
+
+ Available via the World Wide Web: http://www.govinfo.gov/
+
+ __________
+
+
+ U.S. GOVERNMENT PUBLISHING OFFICE
+
+35-378 PDF WASHINGTON : 2019
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+ COMMITTEE ON HOMELAND SECURITY
+
+ Bennie G. Thompson, Mississippi, Chairman
+Sheila Jackson Lee, Texas Mike Rogers, Alabama
+James R. Langevin, Rhode Island Peter T. King, New York
+Cedric L. Richmond, Louisiana Michael T. McCaul, Texas
+Donald M. Payne, Jr., New Jersey John Katko, New York
+Kathleen M. Rice, New York John Ratcliffe, Texas
+J. Luis Correa, California Mark Walker, North Carolina
+Xochitl Torres Small, New Mexico Clay Higgins, Louisiana
+Max Rose, New York Debbie Lesko, Arizona
+Lauren Underwood, Illinois Mark Green, Tennessee
+Elissa Slotkin, Michigan Van Taylor, Texas
+Emanuel Cleaver, Missouri John Joyce, Pennsylvania
+Al Green, Texas Dan Crenshaw, Texas
+Yvette D. Clarke, New York Michael Guest, Mississippi
+Dina Titus, Nevada
+Bonnie Watson Coleman, New Jersey
+Nanette Diaz Barragan, California
+Val Butler Demings, Florida
+ Hope Goins, Staff Director
+ Chris Vieson, Minority Staff Director
+ ------
+
+ SUBCOMMITTEE ON TRANSPORTATION AND MARITIME SECURITY
+
+ J. Luis Correa, California, Chairman
+Emanuel Cleaver, Missouri Debbie Lesko, Arizona, Ranking
+Dina Titus, Nevada Member
+Bonnie Watson Coleman, New Jersey John Katko, New York
+Nanette Diaz Barragan, California John Ratcliffe, Texas
+Val Butler Deming, Florida Mark Green, Tennessee
+Bennie G. Thompson, Mississippi (ex Mike Rogers, Alabama (ex officio)
+ officio)
+ Alex Marston, Subcommittee Staff Director
+ Kyle Klein, Minority Subcommittee Staff Director
+ ------
+
+ SUBCOMMITTEE ON CYBERSECURITY, INFRASTRUCTURE PROTECTION, AND
+ INNOVATION
+
+ Cedric L. Richmond, Louisiana, Chairman
+Sheila Jackson Lee, Texas John Katko, New York, Ranking
+James R. Langevin, Rhode Island Member
+Kathleen M. Rice, New York John Ratcliffe, Texas
+Lauren Underwood, Illinois Mark Walker, North Carolina
+Elissa Slotkin, Michigan Van Taylor, Texas
+Bennie G. Thompson, Mississippi (ex Mike Rogers, Alabama (ex officio)
+ officio)
+ Moira Bergin, Subcommittee Staff Director
+ Sarah Moxley, Minority Subcommittee Staff Director
+
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+ C O N T E N T S
+
+ ----------
+ Page
+
+ STATEMENTS
+
+The Honorable J. Luis Correa, a Representative in Congress From
+ the State of California, and Chairman, Subcommittee on
+ Transportation and Maritime Security:
+ Oral Statement................................................. 1
+ Prepared Statement............................................. 2
+The Honorable Debbie Lesko, a Representative in Congress From the
+ State of Arizona, and Ranking Member, Subcommittee on
+ Transportation and Maritime Security:
+ Oral Statement................................................. 3
+ Prepared Statement............................................. 5
+The Honorable Cedric L. Richmond, a Representative in Congress
+ From the State of Lousiana, and Chairman, Subcommittee on
+ Cybersecurity, Infrastructure Protection, and Innovation:
+ Oral Statement................................................. 8
+ Prepared Statement............................................. 9
+The Honorable John Katko, a Representative in Congress From the
+ State of New York, and Ranking Member, Subcommittee on
+ Cybersecurity, Infrastructure Protection, and Innovation:
+ Prepared Statement............................................. 3
+The Honorable Bennie G. Thompson, a Representative in Congress
+ From the State of Mississippi, and Chairman, Committee on
+ Homeland Security:
+ Oral Statement................................................. 6
+ Prepared Statement............................................. 7
+The Honorable Sheila Jackson Lee, a Representative in Congress
+ From the State of Texas:
+ Prepared Statement............................................. 11
+
+ WITNESSES
+ Panel I
+
+Mr. Robert Kolasky, Director, National Risk Management Center,
+ Cybersecurity and Infrastructure Security Agency, U.S.
+ Department of Homeland Security:
+ Oral Statement................................................. 13
+ Prepared Statement............................................. 15
+Ms. Sonya T. Proctor, Director, Surface Division, Office of the
+ Security Policy and Industry Engagement, Transportation
+ Security Administration:
+ Oral Statement................................................. 19
+ Prepared Statement............................................. 20
+
+ Panel II
+
+Mr. James A. Lewis, Senior Vice President, Center for Strategic
+ and International Studies:
+ Oral Statement................................................. 38
+ Prepared Statement............................................. 39
+Ms. Rebecca Gagliostro, Director, Security, Reliability, and
+ Resilience, Interstate Natural Gas Association of America:
+ Oral Statement................................................. 42
+ Prepared Statement............................................. 44
+Mr. Erik Robert Olson, Vice President, Rail Security Alliance:
+ Oral Statement................................................. 46
+ Prepared Statement............................................. 49
+Mr. John Hultquist, Director of Intelligence Analysis, FireEye:
+ Oral Statement................................................. 53
+ Prepared Statement............................................. 54
+
+
+ SECURING U.S. SURFACE TRANSPORTATION FROM CYBER ATTACKS
+
+ ----------
+
+
+ Tuesday, February 26, 2019
+
+ U.S. House of Representatives,
+ Subcommittee on Transportation and Maritime
+ Security, and the
+ Subcommittee on Cybersecurity, Infrastructure Protection
+ and Innovation,
+ Committee on Homeland Security,
+ Washington, DC.
+ The subcommittees met, pursuant to notice, at 10:03 a.m.,
+in room 310, Cannon House Office Building, Hon. J. Luis Correa
+[Chairman of the Subcommittee on Transportation and Maritime
+Security] presiding.
+ Present: Representatives Correa, Richmond, Cleaver, Jackson
+Lee, Langevin, Watson Coleman, Rice, Barragan, Underwood,
+Slotkin, Lesko, Walker, and Taylor.
+ Also present: Representative Thompson.
+ [Editor's Note.--Due to technical difficulties, audible
+portions of this transcript were not recorded and those
+instances have been marked accordingly.]
+ Mr. Correa. Good morning everyone. Seeing the time of 10:05
+having arrived, I would like to gavel down and chair--and call
+the Subcommittees on Transportation and Maritime Security, and
+Cybersecurity, Infrastructure Protection, and Innovation, to
+order.
+ Today's hearing marks the first hearing of this Congress
+for the Subcommittee on Transportation and Maritime Security. I
+am excited to be chairing this subcommittee in this Congress
+and to be joined by our Ranking Member, Congresswoman Lesko
+from Arizona; I understand she is getting snow in Arizona, that
+is----
+ Mrs. Lesko. Right, that is--we were. It was crazy----
+ Mr. Correa. You were?
+ Mrs. Lesko. In Phoenix.
+ Mr. Correa. Save the water.
+ We have a great panel of distinguished Members on both
+sides of the aisle and I look forward to working with all of
+you to tackle the security challenges facing the transportation
+and maritime sectors.
+ I am glad to hold our first hearing, jointly with the
+Cybersecurity Subcommittee, and its leaders, Chairman Richmond,
+and Ranking Member Katko, who, Mr. Katko, unfortunately is not
+able to join us today.
+ I am also happy to welcome our two panels today of
+witnesses and I look forward to your testimony.
+ We are here today to discuss a very important topic:
+Cybersecurity in our Nation's mass transit, rail, pipeline, and
+other surface transportation systems. Cyber threats are a
+growing concern for security experts across many sectors and
+the surface transportation sector is no different. Millions of
+Americans, we rely on surface transportation every day and an
+attack against a large subway system or pipeline could have
+hugely negative effects on all of us.
+ Government and industry have both struggled to address
+cyber threats which have evolved quickly and have become more
+and more complex and I believe DHS is well-positioned to lead
+cybersecurity in the efforts across critical infrastructure
+sectors including the surface transportation sector.
+ Last year, Congress established a Cybersecurity
+Infrastructure and Security Agency, or CISA, making clear its
+status as the preeminent Cybersecurity Agency within the
+Federal Government. CISA works closely with TSA which is
+responsible for securing all modes of transportation. In
+December 2018 working with CISA, TSA released a Cybersecurity
+Roadmap that sets priorities for securing transportation from
+cyber threats.
+ The Roadmap is an important first step in the right
+direction, but it has to be followed by concrete action. In
+coordination with CISA, TSA must ensure owners and operators
+have access to the resources, intelligence, guidelines, and
+assessments needed to ensure the cybersecurity of their systems
+is as good as it can get.
+ Government and industry stakeholders together must also
+address supply chain security concerns. We must make sure that
+surface transportation systems are not made vulnerable to cyber
+espionage due to unchecked foreign manufacturing of subways
+[inaudible] some have questioned whether DHS has paid enough
+attention to Pipeline security and have raised the idea of
+moving the responsibility from securing pipelines to another
+department and Ms. Proctor I do hope you address that issue
+during your comments [inaudible] because it would go against
+the reasons Congress established DHS, TSA, and CISA.
+ Only DHS has the scope of authorities and access to
+intelligence needed to address cyber threats across critical
+infrastructure sectors. DHS has made significant progress in
+securing pipelines, including recent updates of TSA's Pipeline
+Security Guidelines and it should be allowed to build upon
+these on-going efforts.
+ This hearing provides a great opportunity to discuss the
+work of both Government and the private sector to ensure all
+modes of transportation are secure from cyber threats and I
+look forward to a very productive conversation.
+ [The statement of Chairman Correa follows:]
+ Statement of Chairman J. Luis Correa
+ February 26, 2019
+ We have a great panel of distinguished Members on both sides of the
+aisle, and I look forward to working with you all to tackle the
+security challenges facing the transportation and maritime sectors. I
+am glad to hold our first hearing jointly with the Cybersecurity
+Subcommittee and its leaders, Chairman Richmond and Ranking Member
+Katko. I am also happy to welcome our two panels of witnesses today. We
+look forward to your testimony.
+ We are here today to discuss an important topic: The cybersecurity
+of our Nation's mass transit, rail, pipeline, and other surface
+transportation systems. Cyber threats are a growing concern for
+security experts across many sectors--and the surface transportation
+sector is no different. Millions of Americans rely on surface
+transportation every day for critical services, and an attack against a
+large subway system or pipeline could have a hugely negative impact.
+ Government and industry have both struggled to address cyber
+threats, which are evolving quickly and becoming more complex. However,
+I believe DHS is well-positioned to lead cybersecurity efforts across
+critical infrastructure sectors, including the surface transportation
+sector.
+ Last year, Congress established the Cybersecurity and
+Infrastructure Security Agency, or CISA, making clear its status as the
+preeminent cybersecurity agency within the Federal Government. To
+secure surface transportation from cyber attacks, CISA works closely
+with TSA, which is responsible for securing all modes of
+transportation.
+ In December 2018, working with CISA, TSA released a Cybersecurity
+Roadmap, which sets priorities for securing transportation from cyber
+threats. The publication of this roadmap is an important step in
+addressing the cybersecurity of transportation, but it must be followed
+by concrete action.
+ In the surface mode, TSA works collaboratively with the system
+owners and operators who provide front-line security at the local
+level. In coordination with CISA, TSA must ensure owners and operators
+have access to the resources, intelligence, guidelines, and assessments
+needed to ensure the cybersecurity of their systems.
+ Government and industry stakeholders together must also address
+supply chain security concerns. We must make sure that surface
+transportation systems are not made vulnerable to cyber espionage due
+to unchecked foreign manufacturing of subway cars or other
+infrastructure.
+ Finally, some have questioned whether DHS has paid enough attention
+to pipeline security and have raised the idea of moving responsibility
+for securing pipelines to another department. Doing so would be
+foolhardy and go against the reasons Congress established DHS, TSA, and
+CISA. Only DHS has the scope of authorities and access to intelligence
+needed to address cyber threats across critical infrastructure sectors.
+ For example, only TSA has authority to issue Security Directives to
+require immediate implementation of security measures across or within
+modes of transportation in the face of an imminent threat or on-going
+attack.
+ DHS has made significant progress in securing pipelines, including
+recent updates to TSA's Pipeline Security Guidelines, and it should be
+allowed to build upon its on-going efforts.
+ This hearing provides a great opportunity to discuss the work of
+both Government and private industry to secure all modes of
+transportation from cyber threats, and I look forward to a productive
+conversation.
+
+ Mr. Correa. Now I would like to recognize the Ranking
+Member of the subcommittee, the gentlewoman from Arizona, Mrs.
+Lesko, for an opening statement.
+ Mrs. Lesko. Thank you, Mr. Chairman.
+ Thank you to all of you that are here today including the
+people coming as our testifiers.
+ First, I would like to ask people to keep Representative
+Katko, in your prayers because his father passed away and that
+is why he is not here today and so Mr. Chairman, I do ask for
+unanimous consent for Representative Katko's statement to be
+added to the record.
+ Mr. Correa. Without objection.
+ [The statement of Ranking Member Katko follows:]
+ Statement of Ranking Member John Katko
+ Thank you, Mr. Chairman, and thank you for holding a hearing on
+this important issue.
+ I am pleased that my first subcommittee hearing as Ranking Member
+of the Cybersecurity, Infrastructure Protection, and Innovation
+subcommittee is a joint hearing with the subcommittee I was honored to
+chair for 4 years.
+ Our world is increasingly connected. Our phones, computers, cars,
+and televisions are only some of the things we use every day that are
+vulnerable to a cyber attack that causes disruptions.
+ But what about those objects that affect our everyday life, that we
+either don't see or don't consider them to be vulnerable to cyber
+attacks like pipelines that undergird this country's energy sector or
+the metro cars we rely on to get us around?
+ A cyber attack on the industrial control systems for our
+operational technology could wreak havoc across our Nation. It is an
+attack vector that we must take seriously and work to secure these
+technologies from motivated attackers.
+ Fortunately, we have two partners who are well-equipped to address
+these vulnerabilities. TSA brings the expertise about our pipelines and
+mass transit systems while CISA is the cyber expert. I want to
+reiterate what my colleague, Ranking Member Lesko said in her opening
+statement--TSA and CISA are stronger because of their ability to work
+together. Their value is made greater by the wealth of resources within
+DHS to help surface transportation operators be prepared for the cyber
+threats.
+ As a committee, we must be vigilant in making sure the various
+sectors of our economy are protecting their assets from physical and
+cyber harm. We cannot allow for those technologies that are
+foundational to our livelihood be a tool for a bad actor to launch a
+cyber attack.
+ Thank you to our witnesses for taking the time this morning to
+speak on this topic. I look forward to hearing from you.
+
+ Mrs. Lesko. Thank you, Mr. Chairman, and thank you for
+holding a hearing today on this very important topic.
+ TSA has security authorities over America's surface
+transportation modes including 6,700 mass transit systems,
+passenger and freight rail as well as motor coach in both rural
+and urban communities. In addition, pipelines are considered a
+mode of surface transportation for natural gas and hazardous
+materials. Across the United States, including in my home State
+of Arizona, TSA is responsible for securing more than 2\1/2\
+million miles of pipelines carrying natural gas and other
+materials that quite literally fuel our economy.
+ While much progress has been made to provide better
+physical security for surface transportation, there remains
+growing concerns surrounding the cybersecurity of our Nation's
+surface transportation assets. As cyber actors become more
+sophisticated and surface transportation systems become
+increasingly reliant on computer systems, the vulnerability of
+this critical sector grows along with the risks posed by
+nefarious actors who may seek to exploit cybersecurity
+vulnerabilities to cause service disruptions or conduct
+economic espionage.
+ In general, surface transportation systems utilize a number
+of interconnected information systems that, when exposed,
+present cybersecurity vulnerabilities. According to the
+American Public Transit Association, cyber attacks against
+surface transportation operators can destroy an agency's
+physical systems, render them inoperable, hand over control of
+systems to an outside entity, or threaten the privacy of
+individuals or customers.
+ In the 115th Congress, the Republican Majority worked in a
+bipartisan manner to enact the TSA Modernization Act, the
+first-ever authorization of TSA since the agency was created in
+2001. We also enacted the Cybersecurity and Infrastructure
+Security Agency Act of 2018 which created CISA in order to
+reform critical security programs within the Department and
+better equip DHS to support the cybersecurity of transportation
+systems.
+ Additionally, TSA Administrator Pekoske has worked to
+restructure the agency to reflect evolving mission needs. It is
+important to note that while threats against our transportation
+sector may be evolving, they are not diminishing. Legitimate
+concerns have been raised as to the ability of TSA to provide
+necessary security for surface transportation assets and
+particularly pipelines.
+ While I believe TSA is best positioned as the Government's
+authority on transportation security, it is incumbent upon the
+agency to demonstrate its commitment to securing all modes of
+transportation. The Department of Homeland Security and its
+components must work to mitigate growing cybersecurity threats
+and work hand-in-hand with industry partners to promote a
+culture of security and keep America's economy fueled and
+moving with the public's confidence.
+ I do look forward to hearing the testimony before us today
+and thank you for being here.
+ I yield back, Mr. Chairman.
+ [The statement of Ranking Member Lesko follows:]
+ Statement of Ranking Member Debbie Lesko
+ February 26, 2019
+ TSA has security authorities over America's surface transportation
+modes, including 6,700 mass transit systems, passenger and freight
+rail, as well as motorcoach, in both rural and urban communities. In
+addition, pipelines are considered a mode of surface transportation for
+natural gas and hazardous materials. Across the United States,
+including in my home State of Arizona, TSA is responsible for securing
+more than 2.5 million miles of pipelines carrying natural gas and other
+materials that quite literally fuel our economy.
+ While much progress has been made to provide better physical
+security for surface transportation there remains growing concern
+surrounding the cybersecurity of our Nation's surface transportation
+assets.
+ As cyber actors become more sophisticated and surface
+transportation systems become increasingly reliant on computer systems,
+the vulnerability of this critical sector grows, along with the risk
+posed by nefarious actors who may seek to exploit cybersecurity
+vulnerabilities to cause service disruptions or conduct economic
+espionage.
+ In general, surface transportation systems utilize a number of
+interconnected information systems that, when exposed, present
+cybersecurity vulnerabilities. According to the American Public Transit
+Association, cyber attacks against surface transportation operators can
+destroy an agency's physical systems, render them inoperable, hand over
+control of systems to an outside entity or threaten the privacy of
+individuals or customers.
+ In the 115th Congress, the Republican Majority worked in a
+bipartisan manner to enact the TSA Modernization Act, the first-ever
+authorization of TSA since the agency was created in 2001. We also
+enacted the Cybersecurity and Infrastructure Security Agency Act of
+2018, which created CISA in order to reform critical security programs
+within the Department and better equip DHS to support the cybersecurity
+of transportation systems. Additionally, TSA Administrator Pekoske has
+worked to restructure the agency to reflect evolving mission needs.
+ It is important to note that while threats against our
+transportation sector may be evolving, they are not diminishing.
+Legitimate concerns have been raised as to the ability of TSA to
+provide necessary security for surface transportation assets, in
+particular pipelines. While I believe TSA is best positioned as the
+Government's authority on transportation security, it is incumbent upon
+the agency to demonstrate its commitment to securing all modes of
+transportation. The Department of Homeland Security and its components
+must work to mitigate growing cybersecurity threats and work hand-in-
+hand with industry partners to promote a culture of security and keep
+America's economy fueled and moving with the public's confidence.
+
+ Mr. Correa. Thank you very much.
+ I will--I would like to recognize the Chair of the
+Committee on Homeland Security, Mr. Bennie Thompson, for some
+opening remarks, sir.
+ Mr. Thompson. Thank you very much, Chairman Correa; Ranking
+Member Lesko, on your maiden voyage as Ranking Member, welcome.
+ I would also like to express my sympathies to Ranking
+Member Katko on the loss of his father.
+ But also, this hearing today is very important, the cyber
+threats facing the U.S. surface transportation sector. Since
+the 9/11 attacks, the U.S. Government has focused on closing
+gaps in physical aviation security by Federalizing passenger
+and baggage screening, hardening cockpit doors, and deploying
+improved screening technologies and training.
+ In September 2018 the subcommittees held a joint hearing
+highlighting the potential harm from important undisclosed
+vector cyber threats in aviation. Today we will provide the
+same attention to cybersecurity threats to the surface
+transportation sector.
+ With TSA dedicating most of its resources to protecting
+aviation, the surface transportation sector including freight
+and passenger trains, commuter rails, mass transit, buses, and
+pipelines presents relatively a soft target for mass casualty
+attacks. We rely on these diverse assets not only for our
+shipping and other transports of natural gas, and a host of
+other activities essential to the health of our economy and
+National security.
+ In recent years, surface transportation systems overseas
+have been hit by terrorist attacks. On our own shores, New York
+City's subway was a target of a failed terrorist plot in
+December 2017. Given the level of risk to surface
+transportation, I am concerned that we have not sufficiently
+protected this sector against cyber threats.
+ To date no cyber attacks have disrupted the actual
+operations of surface transportation systems but attacks have
+resulted in financial disruption and affected public confidence
+in various modes of surface transportation. These small-scale
+attacks have shown that a relatively simple intrusion could up
+end surface transportation services causing significant harm
+and disruption.
+ Last year Congress established Cybersecurity and
+Infrastructure Security Agency or CISA as the operational
+agency within the Federal Government [inaudible] on
+cybersecurity information sharing. CISA will continue to play a
+critical role in providing cybersecurity resources within DHS
+including to TSA and to industries, to combat cyber threats to
+critical infrastructure. TSA for its part maintains
+responsibility for the security of all modes of transportation.
+Working together within DHS, CISA and TSA are uniquely
+positioned to address cyber threats in transportation.
+ I would note that DHS's authorities and capabilities across
+critical infrastructures' sectors in all modes of
+transportation makes it better positioned to secure pipelines
+than the Department of Energy, despite some suggestions to the
+contrary.
+ In December 2018, in coordination with CISA, TSA released
+its first-ever Cybersecurity Roadmap, providing a vision for
+the future of cybersecurity across all modes of transportation,
+while DHS is headed in the right direction much work remains.
+In many cases surface transportation sector-owners and -
+operators struggle with the same cyber challenges that plague
+other industries: A National shortage of skilled cybersecurity
+personnel; a work force with minimal cybersecurity training and
+awareness; and resource constraints across the board.
+ Finally, at a hearing on surface transportation security, I
+would be remiss if I did not point out that TSA remains non-
+compliant with requirements to publish surface transportation
+security regulations which were enacted over a decade ago in
+the Implementation Recommendations of the 9/11 Commission Act
+of 2007.
+ I would like to at some point, Mr. Chairman, hope to get a
+response to why we have not had that take place.
+ With that I yield back.
+ [The statement of Chairman Thompson follows:]
+ Statement of Chairman Bennie G. Thompson
+ February 26, 2019
+ Since the 9/11 attacks, the U.S. Government has focused on closing
+gaps in physical aviation security by Federalizing passenger and
+baggage screening, hardening cockpit doors, and deploying improved
+screening technologies and training.
+ In September 2018, the subcommittees held a joint hearing
+highlighting the potential harm from an important, underdiscussed
+vector: Cyber threats to aviation. Today, we will provide the same
+attention to cybersecurity threats to the surface transportation
+sector.
+ With TSA dedicating most of its resources to protecting aviation,
+the surface transportation sector--including freight and passenger
+trains, commuter rail, mass transit, buses, and pipelines--presents a
+relatively soft target for mass-casualty attacks. We rely on these
+diverse assets not only support for our personal and business travel,
+but also commercial shipping, the transport of natural gas, and a host
+of other activities essential to the health of our economy and National
+security.
+ In recent years, surface transportation systems overseas have been
+hit by terrorist attacks. On our own shores, New York City's subway was
+the target of a failed terrorist plot in December 2017. Given the level
+of risk to surface transportation, I am concerned that we have not
+sufficiently protected this sector against cyber threats.
+ To date, no cyber attacks have disrupted the actual operations of
+surface transportation systems, but attacks have resulted in financial
+disruption and affected public confidence in various modes of surface
+transportation. These small-scale attacks have shown that a relatively
+simple intrusion could upend surface transportation services, causing
+significant harm and disruption.
+ Last year, Congress established Cybersecurity and Infrastructure
+Security Agency, or CISA, as the operational agency within the Federal
+Government charged with serving as the primary civilian interface for
+cybersecurity information sharing. CISA will continue to play a
+critical role in providing cybersecurity resources within DHS,
+including to TSA, and to industry to combat cyber threats to critical
+infrastructure.
+ TSA, for its part, maintains responsibility for the security of all
+modes of transportation.
+ Working together within DHS, CISA, and TSA are uniquely positioned
+to address cyber threats to transportation.
+ I would note that DHS's authorities and capabilities across all
+critical infrastructure sectors and all modes of transportation makes
+it better positioned to secure pipelines than the Department of Energy,
+despite some suggestions to the contrary.
+ In December 2018, in coordination with CISA, TSA released its
+first-ever Cybersecurity Roadmap, providing a vision for the future of
+cybersecurity across all modes of transportation.
+ While DHS is headed in the right direction, much work remains. In
+many cases, surface transportation sector owners and operators struggle
+with the same cyber challenges that plague other industries: A National
+shortage of skilled cybersecurity personnel, a workforce with minimal
+cybersecurity training and awareness, and resource constraints across
+the board.
+ Owners and operators must also address supply chain concerns,
+including those posed by the emergence of a Chinese state-owned
+enterprise manufacturing subway cars for U.S. mass transit systems.
+Government and industry must work together to ensure that cyber threats
+and vulnerabilities are fully understood and appropriately addressed.
+ Finally, at a hearing on surface transportation security, I would
+be remiss if I did not point out that TSA remains non-compliant with
+requirements to publish surface transportation security regulations,
+which were enacted over a decade ago in the Implementing
+Recommendations of the 9/11 Commission Act of 2007.
+ The rules required under the law would help TSA to better assess
+and address vulnerabilities within the surface transportation sector,
+including cybersecurity vulnerabilities.
+ I look forward to hearing from this panel of witnesses today, and I
+hope they will give us a candid assessment of the cybersecurity posture
+of our surface transportation sector.
+
+ Mr. Correa. Thank you, Chairman Thompson, for those opening
+statements.
+ Now I would like to recognize the co-Chair of this hearing
+today, Mr. Richmond, Chairman of the Cybersecurity,
+Infrastructure Protection, and Innovation Subcommittee for an
+opening statement. Welcome, sir.
+ Mr. Richmond. Thank you, Mr. Chairman.
+ I will recognize the Chairman of the whole--full committee,
+Mr. Bennie Thompson, from Mississippi.
+ I will also join my colleagues in extending my condolences
+to Congressman Katko. As a person who has lost two fathers, I
+understand what he is going through and we wish him the best.
+ I want to start by congratulating Congressman Correa, on
+becoming Chairman of the Transportation and Maritime Security
+Subcommittee. I look forward to working with you to improve the
+cybersecurity posture of our transportation infrastructure.
+ Last fall our subcommittees held a joint hearing to assess
+cybersecurity risks to aviation. We learned that cyber threats
+to aviation are persistent, that cyber tools can be used to
+engage in cyber espionage or undermine confidence in the
+aviation industry and that the safety of air travelers requires
+us to stay a step ahead of bad actors.
+ In short, we learned that cybersecurity posture of the
+aviation sector is a National security, economic security, and
+public safety imperative. The same can be said for the
+cybersecurity posture of our surface transportation systems.
+Surface transportation includes roads, rail, maritime
+facilities, and pipelines and my district is rich in all of
+them so I am glad that we are beginning the 116th Congress with
+this hearing.
+ Compared to the aviation sector, surface transportation
+receives relatively little in Federal funding to support
+security. Outside of the Transit Security Grant Program which
+is awarded to public transportation entities and primarily used
+to secure against physical threats, surface transportation
+owners and operators foot the bill for security themselves.
+ But the Federal Government is not off the hook, it plays a
+critical role in providing the situational awareness, security
+assessments, and guidance to stakeholders that inform surface
+transportation security investments.
+ In a decade-and-a-half since it was established, the
+Department of Homeland Security has matured its ability to
+convene stakeholders, leverage its cross-component expertise,
+and share actionable intelligence analysis and guidance to help
+address pressing National security challenges.
+ Whether or not the Federal Government can effectively
+partner with stakeholders to secure surface transportation
+modes from cyber attacks, rests on DHS's ability to continue to
+perform and build on these capabilities. Approximately 125,000
+miles of pipelines valued at 1.9 billion move oil and gas
+through Louisiana every day. The industry employs over 2,500
+people in the State; toward that end I was pleased that the
+Pipeline Cybersecurity Initiative was one of the first
+priorities announced by the new National Risk Management Center
+last year and updated Pipeline Security Guidelines were finally
+released last March.
+ I am encouraged that the Department is redoubling its
+efforts to improve the cybersecurity of pipelines by enhancing
+the in-house collaboration between CISA and TSA, and engaging
+with the private sector.
+ I believe the Pipeline Security Initiative has the
+potential to provide a more comprehensive understanding of the
+unique cybersecurity risks to pipelines, particularly as the
+sector relies more on the industrial internet of things; that
+knowledge will empower stakeholders to address cybersecurity
+risks more strategically. Although the Initiative was first
+announced as one of the NRMC's initial sprint, I hope that it
+will evolve into a more permanent collaboration.
+ I am concerned however that the updated Pipeline Security
+Guidelines do not address supply chain risk management;
+moreover I would be interested to know how TSA is implementing
+the 10 recommendations the Government Accountability Office
+made in December related to its management of Pipeline Security
+Program. The safety of my community and the economy of my
+district depends on DHS getting this mission right.
+ I would be remiss if I did not also raise my concerns about
+the cybersecurity posture of both passenger and freight rail,
+particularly as passenger rail cars incorporate automatic train
+control, network and train-line control and monitoring and
+diagnostics, among other technologies.
+ Last month I read a troubling report of a Chinese rail
+company significantly under-bidding competitors to win transit
+rail contracts in four major markets. I am aware of China's
+political and economic ambitions. The intelligence community
+and Congress have been clear in cautioning against the use of
+Chinese telecommunications products.
+ But it is unclear to me whether the Federal Government has
+assessed what, if any additional cybersecurity threat is posed
+by contracting with a Chinese company to purchase railcars with
+advanced technologies. It is also unclear whether the Federal
+Government is providing any guidance to local transit
+authorities to ensure cybersecurity is incorporated into their
+procurement process.
+ I look forward to discussing these issues with the
+witnesses today and I yield back the balance of my time.
+ [The prepared statement of Chairman Richmond follows:]
+ Statement of Chairman Cedric Richmond
+ February 26, 2019
+ Last fall, our subcommittees held a joint hearing to assess
+cybersecurity risks to aviation. We learned that cyber threats to
+aviation are persistent, that cyber tools can be used to engage in
+cyber espionage or undermine confidence in the aviation industry, and
+that the safety of air travelers requires us to stay a step ahead of
+bad actors.
+ In short, we learned that the cybersecurity posture of the aviation
+sector is a National security, economic security, and public safety
+imperative. The same can be said for the cybersecurity posture of our
+surface transportation systems.
+ Surface transportation includes roads, rail, maritime facilities,
+and pipelines, and my district is rich in all of them, so I'm glad we
+are beginning the 116th Congress with this hearing. Compared to the
+aviation sector, surface transportation receives relatively little in
+Federal funding to support security.
+ Outside of the Transit Security Grant Program--which is awarded to
+public transportation entities and primarily used to secure against
+physical threats--surface transportation owners and operators foot the
+bill for security themselves.
+ But the Federal Government is not off the hook. It plays a critical
+role in providing the situational awareness, security assessments, and
+guidance to stakeholders that inform surface transportation security
+investments.
+ In the decade-and-a-half since it was established, the Department
+of Homeland Security has matured its ability to convene stakeholders,
+leverage its cross-component expertise, and share actionable
+intelligence analysis and guidance to help address pressing National
+security challenges.
+ Whether or not the Federal Government can effectively partner with
+stakeholders to secure surface transportation modes from cyber attacks
+rests on DHS's ability to continue to perform and build on these
+capabilities.
+ Approximately 125,000 miles of pipelines--valued at $1.9 billion--
+move oil and gas through Louisiana every day. The industry employs over
+2,500 people in the State. Toward that end, I was pleased that the
+Pipeline Cybersecurity Initiative was one of the first priorities
+announced by the new National Risk Management Center last year and the
+updated Pipeline Security Guidelines were finally released last March.
+I am encouraged that the Department is redoubling its efforts to
+improve the cybersecurity of pipelines by enhancing the in-house
+collaboration between CISA and TSA and engaging with the private
+sector.
+ I believe the Pipeline Cybersecurity Initiative has the potential
+to provide a more comprehensive understanding of the unique
+cybersecurity risks to pipelines, particularly as the sector relies
+more on the industrial internet of things. That knowledge will empower
+stakeholders to address cybersecurity risks more strategically.
+Although the Initiative was first announced as one of the NRMC's
+initial ``sprint,'' I hope that it will evolve into a more permanent
+collaboration. I am concerned, however, that the updated Pipeline
+Security Guidelines do not address supply chain risk management.
+ Moreover, I will be interested to know how TSA is implementing the
+10 recommendations the Government Accountability Office made in
+December related to its management of the Pipeline Security Program.
+The safety of my community and the economy of my district depend on DHS
+getting this mission right.
+ I would be remiss if I did not also raise my concerns about the
+cybersecurity posture of both passenger and freight rail, particularly
+as passenger rail cars incorporate automatic train control, network and
+trainline control, and monitoring and diagnostics, among other
+technologies. Last month, I read troubling reports of a Chinese rail
+company significantly underbidding competitors to win transit rail
+contracts in four major markets.
+ I am aware of China's political and economic ambitions. The
+intelligence community and Congress have been clear in cautioning
+against the use of Chinese telecommunications products.
+ But it is unclear to me whether the Federal Government has assessed
+what, if any, additional cybersecurity threat is posed by contracting
+with a Chinese company to purchase rail cars with advanced
+technologies.
+ It is also unclear whether the Federal Government is providing any
+guidance to local transit authorities to ensure cybersecurity is
+incorporated into their procurement processes.
+ I look forward to discussing these issues with the witnesses and I
+yield back the balance of my time.
+
+ Mr. Correa. Thank you, Chairman Richmond. I also would like
+to congratulate you on your Chairmanship; I look forward to
+working with you as well.
+ Other Members of the subcommittee are reminded that under
+the committee rules, opening statements may be submitted for
+the record.
+ [The statement of Honorable Jackson Lee follows:]
+ Statement of Honorable Sheila Jackson Lee
+ Good morning Chairman Correa and Chairman Richmond, Ranking Member
+Lesko and Ranking Member Katko, for convening today's joint hearing on
+``Securing U.S. Surface Transportation From Cyber Attacks.''
+ At the outset, let me congratulate Chairman Correa and Chairman
+Richmond on your elections to lead the Homeland Security Subcommittees
+on Transportation and Maritime Security and Cybersecurity,
+Infrastructure Protection and Innovation Committee, respectively.
+ I look forward to continuing to work with each of you along with
+returning Members of the committee and welcome an outstanding group of
+new Members on both sides of the aisle, whom I trust will find the
+important work advanced by this committee as fulfilling and rewarding
+as I have since joining it as its inception.
+ Today's witnesses:
+Panel I
+ Mr. Bob Kolasky, director, National Risk Management Center,
+ Cybersecurity and Infrastructure Security Agency, U.S.
+ Department of Homeland Security;
+ Sonya T. Proctor, director, Surface Division, Office of
+ Security Policy and Industry Engagement, Transportation
+ Security Administration.
+Panel II
+ Ms. Rebecca Gagliostro, director, security, reliability, and
+ resilience, Interstate Natural Gas Association of America;
+ James A. Lewis, senior vice president, Center for Strategic
+ and International Studies;
+ Erik Robert Olson, vice president, Rail Security Alliance;
+ Mr. John Hultquist, director of intelligence analysis,
+ FireEye (Minority witness).
+ I thank each of today's witnesses for bringing their expert view on
+the state of cybersecurity and surface transportation in the United
+States.
+ I note that several of today's witnesses warn about China and the
+security of transportation systems in the United States.
+ Their concern is shared by the Department of Defense in its annual
+report to Congress: Military and Security Developments Involving the
+People's Republic of China 2018.
+ The report states that China obtains foreign technology through
+imports, foreign direct investment, industrial and cyber espionage, and
+establishment of foreign research and development (R&D) centers.
+ In addition, an assessment of Cyber Operations by DoD said that
+People's Liberation Army researchers believe that building strong cyber
+capabilities is necessary to protect Chinese networks and advocate
+seizing ``cyber space superiority'' by using offensive cyber operations
+to deter or degrade an adversary's ability to conduct military
+operations against China.
+ These findings by the DoD give our committee ample reason to
+consider the cybersecurity implications of China's activity in the
+transportation sector.
+ The Transportation Security Administration (TSA) is responsible for
+both the physical security and cybersecurity of all modes of
+transportation, including pipelines.
+ In November 2018, TSA released the ``TSA Cybersecurity Roadmap for
+2018,'' its first-ever cybersecurity roadmap.
+ The Roadmap will guide TSA's oversight of the cybersecurity of the
+transportation systems sector over the next 5 years by focusing on four
+priority areas, which include risk identification, vulnerability
+reduction, consequence mitigation, and enabling cybersecurity outcomes.
+ In addition, the Roadmap emphasizes TSA's commitment to recruiting,
+retaining, and training technical and cyber talent to improve its
+ability to engage with stakeholders on cybersecurity and information
+technology issues.
+ Finally, the Roadmap highlights TSA's collaboration with the
+Cybersecurity and Infrastructure Security Agency (CISA), which is the
+operational component within DHS charged with serving as the primary
+Federal civilian interface for cybersecurity information sharing.
+ We know the threats that computing devices and systems face, which
+are almost too numerous to count:
+ Bot-nets;
+ Ransomware;
+ Zero Day Events;
+ Malware;
+ Denial-of-Service Attacks;
+ Distributed Denial-of-Service Attacks;
+ Pharming;
+ Phishing;
+ Data Theft;
+ Data Breaches;
+ SQL Injection;
+ Man-in-the-Middle Attack.
+ The list goes on, but suffice to say that as hard as any one person
+in our Government is working to stop cyber attacks there are likely
+another thousand attempting to breach a system or device or technology
+used by a United States citizen.
+ Vulnerabilities of computing systems are not limited to intentional
+attacks, but can include acts of nature, human error, or technology
+failing to perform as intended.
+ I am particularly concerned about cybersecurity of transportation
+for pipelines, bridges, tolls, air traffic control systems, commercial
+aircraft, ports, and automobiles.
+ Government agencies and political institutions around the world
+have acknowledged that air traffic management and control (ATM/ATC)
+vulnerabilities could be used to undermine National security.
+ Any breach of the U.S. air traffic control system can lead to
+flight interruptions that may result in cancellations.
+ The number, type, and severity of cyber threats experienced by
+ports, service providers, or port customers are unknown because victims
+generally prefer not to report incidents and to pay or absorb costs
+resulting from breaches or thefts.
+ Another reason for underreporting is that companies and ports often
+are unaware that their cybersecurity has been breached.
+ In January 2019, the American Association of Port Authorities
+(AAPA) identified nearly $4 billion in crucial port and supply chain
+security needs over the next 10 years.
+ The AAPA says that funding is needed to ensure America's port
+facilities are properly equipped to address new and evolving security
+challenges.
+ The report recommends refocusing the Federal Emergency Management
+Agency's Port Security Grant Program to better meet the security
+infrastructure needs of publicly-owned commercial seaports and related
+maritime operations.
+ AAPA recommends funding an estimated $2.62 billion in maintenance
+and upgrades to port security equipment and systems, and another $1.27
+billion for investments to tackle cybersecurity, active shooter, drone
+mitigation, resiliency, and other evolving security threats.
+ It is reported that the U.S. Government invests $100 million
+annually in the Port Security Grant Program.
+ This grant program began after 9/11, and it is estimated that by
+the end of 2017, container volumes through U.S. ports have increased 71
+percent and total foreign trade tonnage had increased 37 percent, while
+cruise passenger traffic nearly doubled by the end of 2018.
+ During this time, 85 percent of AAPA U.S. member ports report that
+they anticipate direct cyber or physical threats to their ports to
+increase over the next 10 years.
+ The 2017 APM Maersk cyber attack illustrates how an incident can
+start outside the United States and have a cascading impact on ports
+and terminal operations across the globe.
+ Further evidence on the cyber vulnerability of ports, comes from
+October 15, 2014, in a report by CyberKeel entitled, ``Maritime Cyber-
+Risks,'' which focused on financial thefts; alteration of carrier
+information regarding cargo location; barcode scanners used as hacking
+devices (a variation of the light bulb vulnerability described above);
+targeting of shipbuilding and maritime operations; cyber-enabled large
+drug smuggling operations; compromising of Australian customs and
+border protection; spoofing a vessel Automated Identification System
+(AIS); drilling rig cyber attack; vessel navigation control hack; GPS
+jamming; vulnerabilities in the Electronic Chart Display and
+Information System; and a Danish Maritime Authority breach.
+ In 2015, I hosted a briefing on ``Cyber Security Threat Posed by
+the Ability to Hack Automobiles,'' which provided information on the
+growing threat of remote attacks against moving vehicles and the
+privacy of consumer data captured by automotive systems.
+ Finally, the use of untrustworthiness of transportation
+infrastructure can have significant impacts on our Nation's economy.
+ An important part of cybersecurity is establishing and maintaining
+a cybersecurity culture both within the Federal Government and
+throughout the private sector.
+ We must change the way we perceive and respond to cybersecurity
+vulnerabilities and threats.
+ We must be steadfast in our resolve to protect the Nation's
+transportation system from cyber threats.
+ I look forward to the testimony of today's witnesses.
+ Thank you.
+
+ Mr. Correa. With that being said I welcome the first panel
+of witnesses.
+ Our first witness is Mr. Bob Kolasky, who serves as
+director of the National Risk Management Center at the
+Cybersecurity and Infrastructure Security Agency at the
+Department of Homeland Security. As director he oversees the
+Center's efforts to facilitate strategic cross-sector risk
+management approach to cyber and physical threats to our
+critical infrastructure.
+ Next we will have Ms. Sonya Proctor, who serves as director
+of the Surface Division within the Office of Security Policy or
+OSP, at the Transportation Security Agency. Ms. Proctor's
+responsibilities include developing risk-based and effective
+security policy in collaboration with stakeholders in surface
+transportation modes.
+ Without objection, the witnesses' full statements will be
+inserted into the record and I will ask each witness to
+summarize his or her statements in 5 minutes, beginning with
+Mr. Kolasky.
+ Welcome, sir.
+
+STATEMENT OF ROBERT KOLASKY, DIRECTOR, NATIONAL RISK MANAGEMENT
+CENTER, CYBERSECURITY AND INFRASTRUCTURE SECURITY AGENCY, U.S.
+ DEPARTMENT OF HOMELAND SECURITY
+
+ Mr. Kolasky. Thank you, Chairman.
+ Chairman Correa, Chairman Thompson, Chairman Richmond,
+Ranking Member Lesko, and Members of the subcommittee, good
+morning and thank you for the opportunity to testify regarding
+the Department's on-going and collaborative efforts to
+strengthen the cybersecurity of our Nation.
+ Today, as the subject of the hearing, I will focus my
+remarks on surface transportation including pipelines, mass
+transit, freight, rail, and our highways.
+ First however I do want to thank the committee for its
+leadership in establishing the Cybersecurity and Infrastructure
+Security Agency, CISA. By creating our new agency in law,
+Congress formally recognized DHS's role as the leader of the
+National effort to safeguard Federal networks and critical
+infrastructure from cyber and physical threats.
+ CISA delivers organization-specific and cross-sector risk
+management support to enhance the resiliency of our Nation's
+critical infrastructure. We are the main Federal interface for
+sharing cyber-threat indicators. We provide a broad range of
+cybersecurity threat detector response and coordination
+capabilities to assist industry across all sectors, including
+surface transportation, for securing their operations. Our
+capabilities bring together the intelligence committee, law
+enforcement, international partners, and the private sector.
+ As part of CISA, I serve as the director of the National
+Risk Management Center. The Center brings together industry and
+Government for collaborative planning, analysis, and
+prioritization in order to reduce risk to critical
+infrastructure. These efforts complement and support the day-
+to-day operations across our agency and are intended to focus
+on the most significant risks facing the Nation's critical
+infrastructure. To that end cyber threats remain one of the
+most significant strategic risks for the United States.
+ Critical infrastructure cyber incidents however are rarely
+sector-specific which means we can't afford to take a sector-
+specific approach to risk management. Our adversaries target
+common vulnerabilities in systems across sectors. They target
+companies in one sector to launch attacks on a [inaudible] the
+growing interdependencies across sectors demand an integrated
+approach.
+ An attack on the transportation sector has operational
+impact and transcends the operations across the transportation
+sector. That is one reason why we did establish the National
+Risk Management Center. Planning, operations, and information
+sharing to secure critical infrastructure must not be
+stovepiped; this is because of the global, borderless,
+interconnected nature of cyber space where strategic threats
+can manifest in the homeland without advance warning and speed
+of collaboration is essential.
+ In the coming months the National Risk Management Center
+will finalize the identification of a set of National Critical
+Functions. National Critical Functions are defined as the
+functions of Government and the private sector, so vital to the
+United States that their disruption, corruption, or dysfunction
+could have a debilitating impact on National security, economic
+security, National public health, or safety, and we identified
+these in partnership with industry and our colleagues across
+the Government.
+ Through this process we have already identified functions
+associated with surface transportation such as the movement of
+commodities through pipelines and the generation of electricity
+that need to be prioritized. Because of that last year as you
+all mentioned, we launched the Pipeline Security Initiative to
+build upon past work in the sector.
+ This effort is a partnership between CISA, TSA, the
+Department of Energy, as well as industry. CISA is coordinating
+risk management planning and tasking its cybersecurity
+operations, provide technical capabilities in support of my
+colleague Sonya and her team as the sector-specific agency.
+TSA's relationship with the sector and understanding of
+pipeline operations is critical to the success of this
+initiative.
+ The Pipeline Security Initiative is conducting
+cybersecurity assessments on pipelines to identify and mitigate
+vulnerabilities. The first comprehensive assessment was
+completed in December 2018 and we expect to do 9 more this
+year. These are some of the most comprehensive, in-depth, cyber
+assessments the U.S. Government has done on pipelines to date.
+Based on these assessments the NRMC will be conducting initial
+analysis of how best to reduce risk to the Nation's pipeline
+infrastructure, working with industry to prioritize mitigation
+activities.
+ Another example of our work to support the transportation
+sector is industrial control security. Much of our Nation's
+surface transportation is dependent on industrial control
+systems to monitor, control, and safeguard operation. We at
+CISA have a long history of working to provide technical
+expertise and to share information with ICS vendors and we will
+continue to do that with a focus on surface transportation.
+ The final area I want to talk about, the National Risk
+Management Center's efforts are our efforts around supply chain
+security. To address supply chain risks CISA has established an
+Information and Communications Technology Supply Chain Risk
+Management Task Force. This is a public-private partnership to
+facilitate mitigation of emerging supply chain threats.
+ Work is on-going on 4 separate work streams intended to
+improve threat information, better understand priority Supply
+Chain risks, and incentivize and enhance Supply Chain Risk
+Management. This work will help transportation sectors as well
+as critical infrastructure and Federal networks.
+ In closing, CISA will continue to be a partner to our
+Government and industry colleagues with the twin imperative of
+addressing the cyber threats we see today and shaping the risk
+environment of tomorrow. I am convinced that such an approach
+will leave us better prepared to address any challenges we face
+from our adversaries now and in the future.
+ Once again thank you for the opportunity to appear before
+the subcommittee today. I look forward to your questions.
+ [The prepared statement of Mr. Kolasky follows:]
+ Prepared Statement of Robert Kolasky
+ February 26, 2019
+ Chairman Richmond, Chairman Correa, Ranking Member Katko, Ranking
+Member Lesko, and Members of the subcommittees, thank you for the
+opportunity to testify regarding the U.S. Department of Homeland
+Security's (DHS) on-going efforts to reduce and mitigate risks to our
+Nation's critical infrastructure. I have the privilege of serving as
+the director of the National Risk Management Center (NRMC) at the
+Cybersecurity and Infrastructure Security Agency (CISA). The NRMC
+operates as a planning, analysis, and collaboration center bringing
+together industry and multiple parts of Government to identify,
+analyze, prioritize, and reduce risks to critical infrastructure. The
+NRMC's efforts are centered on the ``secure tomorrow'' mantle of CISA's
+mission--complementing and drawing from the day-to-day information
+sharing, technical analysis, and operational assistance missions from
+elsewhere in the agency.
+ My testimony today will focus on the cybersecurity of surface
+transportation systems, including pipelines, mass transit systems,
+freight rail systems, and highways. Both CISA and the Transportation
+Security Administration (TSA) play a critical role in accomplishing
+this mission. CISA is leading National efforts to defend the Nation's
+critical infrastructure today and secure tomorrow by partnering with
+industry and Government to reduce risk from cyber, physical, and hybrid
+threats. Thanks to Congress's leadership and passage of the
+Cybersecurity and Infrastructure Security Agency Act of 2018 (Pub. L.
+115-278), we are now even better poised to further the maturation of
+the organization to best reflect our essential mission and role in
+securing cyber space. CISA's efforts to secure surface transportation
+are carried out in close coordination with the TSA and Department of
+Transportation, the Sector-Specific Agencies (SSA) for the surface
+transportation portion of the Transportation Systems Sector.
+ cyber threats
+ Cyber threats remain one of the most significant strategic risks
+for the United States, threatening our National security, economic
+prosperity, and public health and safety. The past several years have
+marked a growing awareness of the cyber domain in the public
+consciousness. We have seen advanced persistent threat actors,
+including hackers, cyber criminals, and nation-states, increase the
+frequency and sophistication of their attacks. Our adversaries have
+been developing and using advanced cyber capabilities in attempts to
+undermine critical infrastructure, target our livelihoods and
+innovation, steal our National security secrets, and threaten our
+democratic institutions.
+ Cybersecurity threats affecting surface transportation have the
+potential to impact the industrial control systems that operate
+pipelines, mass transit, freight rail systems, and our highway
+infrastructure. For example, America depends heavily on the 2.7 million
+miles of pipeline crisscrossing our country. Increasingly, the business
+operations and control systems that are vital to the continuity of this
+part of our energy posture are threatened by cyber attacks from nation-
+states and other malicious actors. Many pipelines are now supplied with
+industrial control systems, automated pressure regulators, and control
+valves. If this pipeline infrastructure is intentionally attacked,
+control valves and pressure regulators could be affected. Failure of
+these technologies could lead to pressure surges causing emergency
+shutdowns, unexpected explosions and fires, and other serious
+consequences. The recently-published Worldwide Threat Assessment of the
+intelligence community states, ``China has the ability to launch cyber
+attacks that cause localized, temporary disruptive effects on critical
+infrastructure--such as disruption of a natural gas pipeline for days
+to weeks--in the United States.''
+ Similarly, trains are now supplied with on-board information
+technology (IT) systems that provide and receive real-time updates on
+track conditions, train position, train separation, car status, and
+other operational data. While such technologies are designed to provide
+faster and more reliable communications, these wireless communication
+advances result in trains no longer functioning as closed systems, thus
+increasing the cyber risks.
+ Today's industrial control systems within highway infrastructure
+are often not only automated but highly integrated. Interconnected road
+networks are controlled by numerous systems and devices such as traffic
+signal systems, ramp metering systems, road weather information
+systems, and field devices that feed into a traffic management center.
+If an individual system or device was deliberately attacked, the
+potential to affect multiple control systems would be a distinct
+reality.
+ cybersecurity priorities
+ CISA, our Government partners, and the private sector are all
+engaging in a more strategic and unified approach toward improving our
+Nation's overall defensive posture against malicious cyber activity. In
+May of last year, DHS published the Department-wide DHS Cybersecurity
+Strategy, outlining a strategic framework to execute our cybersecurity
+responsibilities during the next 5 years. Both the Strategy and
+Presidential Policy Directive 21--Critical Infrastructure Security and
+Resilience, emphasize that we must maintain an integrated approach to
+managing risk.
+ The National Cyber Strategy, released in September 2018, reiterates
+the criticality of collaboration and strengthens the Government's
+commitment to work in partnership with industry to combat cyber threats
+and secure our critical infrastructure. Together, the National Cyber
+Strategy and DHS Cybersecurity Strategy guide CISA's efforts to secure
+Federal networks and strengthen critical infrastructure. DHS works
+across Government and critical infrastructure industry partnerships to
+share timely and actionable information as well as to provide training
+and technical assistance. Our work enhances cyber threat information
+sharing between and among governments and businesses across the globe
+to stop cyber incidents before they occur and quickly recover when they
+do. By bringing together all levels of government, the private sector,
+international partners, and the public, we are enabling a collective
+defense against cybersecurity risks, while improving our whole-of-
+Government incident response capabilities, enhancing information
+sharing of best practices and cyber threats, strengthening our
+resilience, and facilitating safety.
+ CISA's National Cybersecurity and Communications Integration Center
+(NCCIC) provides entities with information, technical assistance, and
+guidance they can use to secure their networks, systems, assets,
+information, and data by reducing vulnerabilities, ensuring resilience
+to cyber incidents, and supporting their holistic risk management
+priorities. The NCCIC operates at the intersection of the Federal
+Government, State and local governments, the private sector,
+international partners, law enforcement, intelligence, and defense
+communities. The Cybersecurity Information Sharing Act of 2015 (Pub. L.
+114-113) established DHS as the Federal Government's central hub for
+the sharing of cyber threat indicators and defensive measures. CISA's
+automated indicator sharing capability allows the Federal Government
+and private-sector network defenders to share technical information at
+machine speed.
+ Much of our Nation's surface transportation infrastructure is
+dependent on industrial control systems to monitor, control, and
+safeguard operational processes. Many of the industrial control systems
+currently in use were built for operability, efficiency, and
+reliability during an era when security was a lower priority than it is
+today. CISA has a well-established history of working to secure
+industrial control systems across critical infrastructure. In 2004, DHS
+established the Control Systems Security Program to address growing
+concerns over the security of industrial control systems. Since 2009,
+DHS has maintained the Industrial Control Systems Joint Working Group
+as the primary body for communicating and partnering across all
+critical infrastructure sectors and the government at all levels to
+accelerate the design, development, and deployment of secure industrial
+control systems. CISA's industrial control systems cybersecurity
+capabilities include malware and vulnerability analysis; an operational
+watch floor to monitor, track, and investigate cyber incidents;
+incident response; international stakeholder coordination; and the
+creation and dissemination of threat briefings, security bulletins, and
+notices related to emerging threats and vulnerabilities impacting these
+technologies.
+ national risk management
+ Our adversaries' capabilities on-line are outpacing our stove-piped
+defenses. Specifically, there has been a critical gap in cross-sector,
+cross-government coordination on critical infrastructure security and
+resilience. Working together with the private sector and other
+Government partners, we are taking collective action to strengthen
+cross-sector, cross-government coordination against malicious cyber
+actors.
+ Through the NRMC within CISA, we have stepped up our efforts to
+provide a comprehensive risk management approach to cyber and physical
+security. The NRMC is a core component of DHS's efforts to take a
+holistic cross-sector approach to managing risks to the critical
+functions that drive our economy and are necessary to our National
+security. Through the NRMC, Government and industry are coming together
+to create a more complete understanding of the complex perils that
+threaten the Nation's critical infrastructure.
+ Risk is increasingly cross-sector in nature. A siloed approach to
+risk identification and management simply will not work. By the nature
+of the threat, and infrastructure design, risk transcends
+infrastructure sectors, is shared across State and National lines, and
+is held by both Government and industry. As an example, we recently
+briefed industry on cyber activities that have been attributed to
+China. Attempts to steal intellectual property do not discriminate
+between sectors of our economy. From biotechnology, to aircraft
+components, to advanced rail equipment, and electrical generation
+equipment--information is at risk, and it can be weaponized. Similarly,
+the cascading nature of cyber incidents across sectors is very real. We
+need to look no further than NotPetya, the most costly cyber attack in
+history--which we have attributed to Russia--to see how risk easily
+jumps across sectors and continents and how it can hit private sector
+organizations particularly hard.
+ national critical functions
+ Historically, the U.S. Government has focused on prioritizing
+critical infrastructure from the perspective of assets and
+organizations. A different approach for prioritization is needed to
+better address system-wide and cross-sector risks and dependencies.
+CISA, through the NRMC, is leading an effort to develop a set of
+National Critical Functions to guide critical infrastructure risk
+management.
+ National Critical Functions are defined as ``the functions of
+Government and the private sector so vital to the United States that
+their disruption, corruption, or dysfunction would have a debilitating
+impact on National security, economic security, National public health
+or safety.'' This construct forces a risk management conversation that
+is less about whether an entity is a business or Government, and more
+about what an entity does to manage risk and what risk it enables. This
+framework allows us to look at issue sets in the risk management space
+not in isolation, but with a more holistic context.
+ We are partnering with SSAs and all 16 critical infrastructure
+sectors, including the Transportation Systems, Communications,
+Financial Services, and Energy sectors to identify and validate
+National Critical Functions. This list will be finalized in the coming
+months and will form the basis for subsequent analysis--including
+consequence modeling and dependency analysis--in order to develop a
+Risk Register of the most pressing threats facing the critical
+infrastructure community. Such a Risk Register will guide collective
+action between Government and industry on how to best address risk
+management.
+ In doing the critical functions work, we have already identified
+aspects associated with surface transportation, such as pipeline
+operations, that need to be prioritized in terms of security. Although
+we are in our early stages of that work, we agree with the committee on
+the pressing need to address risks associated with nation-state
+exploitation of vulnerabilities that link information to infrastructure
+operations and which could have significant consequences on community
+and economic security.
+ surface transportation cybersecurity
+ The Pipeline Security Initiative is a partnership between CISA,
+TSA, the Department of Energy, and industry. Bad actors have shown
+interest in infiltrating systems in sectors with less mature cyber
+hygiene, and using that access to better understand ways to manipulate
+equipment in sectors with more advanced security protocols. This can
+lead to critical pipeline systems, including water, natural gas, and
+liquid fuels, being at risk.
+ By leveraging the TSA's SSA expertise and CISA's technical
+cybersecurity capabilities, the Pipeline Security Initiative is working
+to improve our ability to identify and mitigate vulnerabilities to the
+pipeline ecosystem. This initiative uses different voluntary
+assessments--ranging from single and multi-day inspections to self-
+assessments--to help our industry partners identify and mitigate
+potential vulnerabilities and provide the Government with a broader
+view of pipeline security risk.
+ In December 2018, we completed our first comprehensive assessment
+under this new initiative. This initial assessment served as a
+successful test-bed to ensure that tools and other techniques offer the
+detail and data necessary to conduct the comprehensive analysis needed
+to ensure critical services and product flow through the pipeline
+systems. We anticipate 9 more assessments in 2019.
+ supply chain risks
+ Information and communications technology (ICT) is critical to
+every business and Government agency's ability to carry out its mission
+efficiently and effectively. Vulnerabilities in ICT can be exploited
+intentionally or unintentionally through a variety of means, including
+deliberate mislabeling and counterfeits, unauthorized production,
+tampering, theft, and insertion of malicious software or hardware. If
+these risks are not detected and mitigated, the impact to the ICT could
+be a fundamental degradation of its confidentiality, integrity, or
+availability and potentially create adverse impacts to essential
+Government or critical infrastructure systems.
+ Increasingly sophisticated adversaries seek to steal, compromise,
+alter, or destroy sensitive information on systems and networks, and
+risks associated with ICT may be used to facilitate these activities.
+The Office of the Director of National Intelligence (ODNI) acknowledges
+that ``the U.S. is under systemic assault by foreign intelligence
+entities who target the equipment, systems, and information used every
+day by Government, business, and individual citizens.'' The
+globalization of our supply chain can result in component parts,
+services, and manufacturing from sources distributed around the world.
+ODNI further states, ``Our most capable adversaries can access this
+supply chain at multiple points, establishing advanced, persistent, and
+multifaceted subversion. Our adversaries are also able to use this
+complexity to obfuscate their efforts to penetrate sensitive research
+and development programs, steal intellectual property and personally
+identifiable information, insert malware into critical components, and
+mask foreign ownership, control, and/or influence of key providers of
+components and services.''
+ CISA has launched the ICT Supply Chain Risk Management (SCRM) Task
+Force as a public-private partnership to mitigate emerging supply chain
+threats. The Task Force is the main private-sector point of entry for
+our SCRM efforts and is jointly chaired by DHS and the chairs of IT and
+Communications Sector Coordinating Councils. The Task Force is focused
+on supply chain threat information sharing, supply chain threat mapping
+and assessment, establishing criteria for qualified bidder and
+manufacturer lists, and incentivizing the purchase of ICT from original
+manufacturers and authorized resellers.
+ conclusion
+ In the face of increasingly sophisticated threats, DHS employees
+stand on the front lines of the Federal Government's efforts to defend
+our Nation's critical infrastructure from natural disasters, terrorism
+and adversarial threats, and technological risk such as those caused by
+cyber threats. The coming revolution of autonomous operations of
+infrastructure and other core functions, which combines data, machine
+learning, algorithms, and computing power and which is associated with
+massive new markets in artificial intelligence, smart cities, and
+quantum computing is going to radically change the nature of National
+security. The underpinning systems enabling functioning infrastructure
+have become more complex, and design considerations have created new
+vulnerabilities. Combine the reality of adversaries who are seeking to
+achieve strategic gain in the global marketplace and there is an
+essential imperative to have security remain a first-order
+consideration for key infrastructure deployments and in the
+establishment of supply chains.
+ CISA is working with partners to meet this century's risks. Doing
+so requires being vigilant about security risk today and playing the
+long game--which will require continued collaboration between the
+Executive and Legislative branches. As the committee considers these
+issues, we are committed to working with Congress to ensure that this
+effort is done in a way that cultivates a safer, more secure, and
+resilient homeland.
+ Thank you for the opportunity to appear before the committee today,
+and I look forward to your questions.
+
+ Mr. Correa. Thank you, Mr. Kolasky.
+ I will now recognize Ms. Proctor, for your testimony; if
+you can summarize your statements in 5 minutes. Thank you.
+
+ STATEMENT OF SONYA T. PROCTOR, DIRECTOR, SURFACE DIVISION,
+ OFFICE OF THE SECURITY POLICY AND INDUSTRY ENGAGEMENT,
+ TRANSPORTATION SECURITY ADMINISTRATION
+
+ Ms. Proctor. Thank you.
+ Good morning, Chairman Thompson, Chairman Correa, and
+Richmond, and Ranking Member Lesko, and distinguished Members
+of the subcommittee. Thank you for the opportunity to appear
+before you this morning to discuss the Transportation Security
+Administration's efforts to secure surface transportation
+systems including oil and natural gas pipelines from
+cybersecurity risks. I also want to thank you for the TSA
+Modernization Act and the support of that.
+ TSA is committed to securing the transportation sector,
+which includes pipelines, against evolving and emerging risks
+such as cyber attacks; partnering with our private-sector
+partners to secure surface transportation from cyber attacks is
+a critically important and complex undertaking.
+ The U.S. surface transportation system is a complex
+interconnected and largely open network comprised of mass
+transit systems, passenger and freight railroads, over-the-road
+bus operators, motor carrier operators, pipelines, and maritime
+facilities. The various modes that make up the system operate
+daily in close coordination with and proximity [inaudible]
+transportation system, operating securely and safely.
+ Every year more than 10 billion trips are taken on 6,800
+U.S. mass transit systems which range from small bus-only
+systems in rural areas to large multi-modal systems in urban
+areas. Over-the-road bus operators carry approximately 604
+million inter-city bus passengers each year; over 3,300
+commercial bus companies travel on the 4 million miles of
+roadway in the United States and on more than 600,000 highway
+bridges and through over 470 tunnels. Those same roads,
+bridges, and tunnels support the movement of goods throughout
+the country by 8 million large-capacity commercial trucks.
+ As for our railroads and pipelines, more than 570
+individual freight railroads carrying essential goods, operate
+on nearly 140,000 miles of track and 2.75 million miles of
+pipelines owned and operated by approximately 3,000 private
+companies, transporting natural gas, refined petroleum
+products, and other commercial products.
+ TSA's functions and authorities as a security agency are
+uniquely structured to tackle the challenges at the
+intersections of surface transportation and cyber risks. To
+secure these networks, TSA leverages its mature intelligence
+and analysis capability along with its vetting and
+credentialing programs to ensure it can quickly develop and
+promulgate risk mitigation guidelines and measures to
+effectively [inaudible] efforts are bolstered by strong
+partnerships, trust, and collaboration with our Federal
+industry and partners.
+ In this regard industry works with TSA to share their own
+unique vulnerabilities and security needs. Through this open
+communication we collaboratively develop programs and
+guidelines for industry to voluntarily adopt to increase their
+overall security posture an approach that has yielded
+significant security investments and improvements beyond what
+the agency would have achieved from a regulatory approach
+alone. We believe that this voluntary and collaborative
+approach to developing and implementing security measures has
+been successful.
+ However, we also recognize that should arise based on an
+eminent threat or real-world event the TSA administrator has
+unique authority to require immediate implementation of certain
+security measures through the issuance of security directives.
+ In December 2018 the TSA administrator issued the agency's
+Cybersecurity Roadmap which will guide efforts to prioritize
+cybersecurity measures within TSA and across the transportation
+system over the next 5 years. TSA approaches both cybersecurity
+and physical security by identifying, assessing, and mitigating
+the risk. TSA helps surface owners and operators identify
+vulnerabilities and risks in their operations and works with
+them to develop and implement risk mitigating solutions.
+ In closing TSA has been able to support the improvement of
+both physical and cybersecurity across all surface modes of
+transportation, including pipelines, thanks to the trust and
+relationships we have cultivated with our Federal partners and
+industry as evidenced by the programs and resources TSA has
+collaboratively developed and implementing for our surface
+transportation stakeholders. TSA is committed to securing the
+Nation's surface transportation system from terrorist
+activities and cyber attacks.
+ TSA looks forward to working with Congress on these efforts
+and thank you for the opportunity to discuss these issues here
+with you today. I look forward to the subcommittee's questions.
+ [The prepared statement of Ms. Proctor follows:]
+ Prepared Statement of Sonya T. Proctor
+ February 26, 2019
+ Good morning Chairmen Correa and Richmond, Ranking Members Lesko
+and Katko, and distinguished Members of the subcommittees. Thank you
+for the opportunity to appear before you to discuss the Transportation
+Security Administration's (TSA) efforts to secure surface
+transportation systems including oil and natural gas pipelines from
+cybersecurity risks.
+ TSA is committed to securing the transportation sector, which
+includes pipelines, against evolving and emerging risks, such as cyber
+attacks. Partnering with our private-sector partners to secure surface
+transportation from cyber attacks is a critically important and complex
+undertaking. As the director of national intelligence recently stated,
+our adversaries and strategic competitors have cyber attack
+capabilities they could use against U.S. critical infrastructure,
+including U.S. surface transportation. As a disruption to any of these
+systems would negatively impact our economy, commerce, and well-being,
+the cyber attack threat is driving the Department of Homeland
+Security's efforts to increase the cyber resilience of surface
+transportation.
+ surface transportation
+ The U.S. surface transportation system is a complex,
+interconnected, and largely open network comprised of mass transit
+systems, passenger and freight railroads, over-the-road bus operators,
+motor carrier operators, pipelines, and maritime facilities. The
+various modes that make up this system operate daily in close
+coordination with and proximity to one another. Americans and our
+economy depend on the surface transportation system operating securely
+and safely.
+ Every year more than 10 billion trips are taken on 6,800 U.S. mass
+transit systems, which range from small bus-only systems in rural areas
+to large multi-modal systems in urban areas. Over-the-road bus
+operators carry approximately 604 million intercity bus passengers each
+year. Over 3,300 commercial bus companies travel on the 4 million miles
+of roadway in the United States and on more than 600,000 highway
+bridges greater than 20 feet in length and through over 470 tunnels.
+Those same roads, bridges, and tunnels support the movement of goods
+throughout the country by 8 million large capacity commercial trucks.
+ As for our railroads and pipelines, more than 570 individual
+freight railroads carrying essential goods operate on nearly 140,000
+miles of track, and 2.75 million miles of pipelines, owned and operated
+by approximately 3,000 private companies, transport natural gas,
+refined petroleum products, and other commercial products.
+ TSA's functions and authorities as a security agency are uniquely
+structured to tackle the challenges at the intersections of surface
+transportation and cyber risks. To secure these networks, TSA leverages
+its mature intelligence and analysis capability, along with its vetting
+and credentialing programs to ensure it can quickly develop and
+promulgate risk mitigation guidelines and measures to effectively
+coordinate and address evolving risk.
+ TSA's security efforts are bolstered by strong partnerships, trust,
+and collaboration with our Federal and industry partners. In this
+regard, industry works with TSA to share their own unique
+vulnerabilities and security needs. Through this open communication, we
+collaboratively develop programs and guidelines for industry to
+voluntarily adopt to increase their overall security posture--an
+approach that has yielded significant security investments and
+improvements beyond what the agency would have achieved from a
+regulatory approach alone.
+ We believe that this voluntary and collaborative approach to
+developing and implementing security measures has been successful.
+However, we also recognize that should the need arise, based on an
+imminent threat or real-world event, the TSA administrator has unique
+authority to require immediate implementation of certain security
+measures through the issuance of Security Directives (SDs).
+ TSA also actively collaborates with law enforcement entities, such
+as the Federal Bureau of Investigation (FBI), the Department of
+Justice, and the Joint Terrorism Task Force, to address attacks on
+critical infrastructure and supporting networks. For example, TSA works
+with the FBI to share intelligence information and host joint working
+groups on investigation and enforcement for attacks on surface
+transportation infrastructure. TSA also serves on the Energy Sector
+Government Coordinating Council, co-chaired by the Department of Energy
+and the DHS Cybersecurity and Infrastructure Security Agency (CISA), to
+discuss energy and pipeline security issues, provide insight on
+relevant intelligence, and coordinate at the Federal level on pipeline-
+related security recommendations and programs. Additionally, TSA works
+closely with the Pipeline and Hazardous Materials Safety Administration
+within the Department of Transportation for incident response and
+monitoring of pipeline systems.
+ tsa cybersecurity roadmap
+ In December 2018, the TSA administrator issued the agency's
+Cybersecurity Roadmap, which will guide efforts to prioritize
+cybersecurity measures within TSA and across the transportation system
+sector over the next 5 years. The Cybersecurity Roadmap identifies 4
+priorities which will help the agency achieve its cybersecurity goals:
+ Identify cybersecurity risks;
+ Reduce vulnerabilities to our systems and critical
+ infrastructure across the transportation systems sector;
+ Mitigate consequences if and when incidents do occur; and,
+ Strengthen security and ensure the resilience of the system.
+ The TSA Cybersecurity Roadmap has been supplemented with the
+development of an implementation plan which will assist in resource
+allocation to this critical area. In coordination with CISA, the
+Federal Government's lead cybersecurity agency, the TSA Cybersecurity
+Roadmap brings TSA's cybersecurity efforts into alignment with both the
+National Cyber Strategy and the DHS Cybersecurity Strategy.
+ tsa's cybersecurity efforts for surface transportation
+ TSA approaches both cybersecurity and physical security by
+identifying, assessing, and mitigating any risks. TSA helps surface
+owners and operators identify vulnerabilities and risks in their
+operations, and works with them to develop and implement risk-
+mitigating solutions.
+ TSA's cybersecurity approach to its critical infrastructure mission
+is based on the National Institute of Standards and Technology (NIST)
+cybersecurity framework, which is designed to provide a foundation that
+industry can implement to sustain robust cybersecurity measures. TSA
+shares information and resources with industry to support adoption of
+the framework.
+ TSA cybersecurity resources and efforts for all modes of surface
+transportation include:
+ Cybersecurity Toolkit.--Provides information on an array of
+ resources, recommendations, and practices available at no cost
+ to surface transportation entities.
+ Cybersecurity Counterterrorism Guides.--``Pocket'' resource
+ guides to help educate all levels of surface transportation
+ professionals on potential cyber threats, actions they can
+ take, and best practices. Over 59,000 cybersecurity guides have
+ been distributed across all modes of surface transportation.
+ Cybersecurity ``5N5'' Workshops.--Provides owners and
+ operators of critical infrastructure with an awareness of
+ existing cybersecurity support programs, resources, familiarity
+ with the NIST Framework, and an opportunity to discuss
+ cybersecurity challenges and share best practices. Workshop
+ participants leave with immediate benefit by receiving 5 non-
+ technical cybersecurity actions to implement over 5 days (5N5).
+ Cybersecurity Awareness Messages (CAMs).--Disseminates
+ information to stakeholders either in response to real-world
+ events or in anticipation of significant anniversaries or
+ holidays to support the transportation security community's
+ efforts to increase their cybersecurity posture, and recommends
+ voluntary cybersecurity protective measures.
+ Daily Cybersecurity Reports.--The Public Transit and Over-
+ the-Road Bus Information Sharing and Analysis Centers
+ distribute daily cybersecurity awareness reports to their
+ members.
+ Pipeline-specific cybersecurity efforts include:
+ TSA Pipeline Security Guidelines.--Initially developed in
+ 2010 and revised in 2011, the Guidelines were revised again in
+ 2018 to align with the NIST Cybersecurity Framework. TSA added
+ a new cybersecurity section to more accurately reflect the
+ current threat environment to help inform industry on how best
+ to allocate their security resources based on their operations.
+ TSA-Federal Energy Regulatory Commission (FERC) Joint
+ Voluntary Cyber Architecture Reviews.--Assesses the pipeline
+ system's cybersecurity environment of operational and business
+ critical network controls. These controls include the networked
+ and segregated environments of Industrial Control System
+ components, such as Supervisory Control and Data Acquisition,
+ Distributed Control Systems, Remote Terminal Units, Human
+ Machine Interfaces, and Process Logic Controllers.
+ Pipeline Cybersecurity Assessments.--DHS has established an
+ initiative to evaluate the cybersecurity posture of critical
+ oil and natural gas pipeline systems to determine their
+ cybersecurity practices and promote resilience. TSA has
+ partnered with CISA to develop on-site cyber assessments of key
+ pipeline systems as part of the Pipeline Security Initiative.
+ The assessments will provide pipeline owners with a
+ comprehensive evaluation and discovery process, focusing on
+ defense strategies associated with asset owners' specific
+ control systems network and segregated control assets. We plan
+ to evaluate as many critical pipeline systems as possible on
+ their cybersecurity posture by the end of this fiscal year, as
+ time and funding allows.
+ Corporate Security Review (CSR) Program and Critical
+ Facility Security Review (CFSR) Programs.--CSRs are conducted
+ to evaluate existing corporate security policies, procedures,
+ and practices, and make recommendations for improving existing
+ corporate security posture. The TSA CSRs have been updated to
+ include a more comprehensive and robust review of the
+ cybersecurity policies, plans, and practices that the pipeline
+ industry is employing. The CFSR program evaluates the top 100
+ most critical pipeline systems in the United States, collecting
+ site-specific information from the facility operator on
+ security policy, procedures, and physical security measures.
+ The CFSR program assessment questions have also been updated to
+ include cyber-specific measures.
+ Classified Briefings.--TSA sponsors Classified briefings for
+ pipeline owners and operators. These briefings provide owners
+ and operators with a need to know on updated pipeline cyber
+ threat information.
+ pipeline security success through voluntary actions
+ TSA had great success in working with the pipeline community to
+develop and implement voluntary guidance and programs to enhance their
+overall security programs and raise their baseline levels of security.
+Specifically, the pipeline community has been very supportive and
+receptive to our Pipeline Security Guidelines, including the addition
+of a comprehensive cybersecurity section. The guidelines serve as the
+de facto standard for pipeline security programs, and were developed in
+close coordination with the pipeline industry. Major pipeline industry
+associations continue to show support of and collaboration with the
+measures set forth in the guidelines. Associations such as the American
+Gas Association, the Interstate Natural Gas Association of America, and
+the American Petroleum Institute, have written ``membership
+statements'' committing to voluntary adherence to the Pipeline Security
+Guidelines.
+ Pipeline operators have shown a willingness and ability to
+voluntarily implement the mitigation measures set forth in the
+guidelines. We have strong evidence that an industry-backed voluntary
+program to reduce risk by increasing compliance with the guidelines is
+working. TSA conducted 23 CSRs in fiscal year 2018, and those pipeline
+operators assessed had a 90 percent compliance rate regarding Corporate
+Security Program Management; an 85 percent compliance rate regarding
+Security Incident Management; and an 80 percent compliance rate
+regarding the TSA recommended cybersecurity practices detailed in the
+2011 Guidelines. In addition, we have seen a strong increase in
+corporate compliance when comparing results from a second review to a
+company's first review. For 10 companies where we have conducted a
+second CSR, we have seen the number of recommendations made decrease
+from a total of 446 recommendations (first review) to 146 (second
+review). In addition, companies have implemented corrective actions on
+over 81 percent of the recommendations made during our CFSRs. This very
+high rate regarding corrective actions is indicative of industry
+acceptance and adherence to TSA Guidelines. In fiscal year 2019, we
+will compile similar CSR data based on the updated 2018 Guidelines,
+which will help determine how and where we apply additional resources
+to the pipeline industry.
+ conclusion
+ In closing, TSA has been able to support the improvement of both
+physical and cybersecurity across all surface modes of transportation,
+including pipelines, thanks to the trust and relationships we have
+cultivated with our Federal partners and industry. As evidenced by the
+programs and resources TSA has collaboratively developed and
+implemented for our surface transportation stakeholders, TSA is
+committed to securing the Nation's surface transportation system from
+terrorist and cybersecurity attacks. TSA looks forward to working with
+Congress on these efforts. Thank you for the opportunity to discuss
+these important issues. I look forward to the subcommittees' questions.
+
+ Mr. Correa. Thank you, Ms. Proctor.
+ I thank both of our witnesses for their comments.
+ Remind the Members that each one of us will have 5 minutes
+for questions.
+ I will now recognize myself for some questions. Ms.
+Proctor, I would like to start out with you. TSA currently
+relies on voluntary standards for pipeline [inaudible] tell me,
+is this good or bad?
+ Ms. Proctor. The approach that we use for working with the
+pipeline industry has been very successful. Yes, we indeed do
+use a voluntary approach, our Pipeline Security Guidelines were
+developed with the industry and they were developed to allow a
+voluntary involvement with the pipeline industry. What we know
+is that with these guidelines we have flexibility to adjust the
+guidelines to the threat environment and certainly if the
+threat dictates, if there is a significant threat, the
+administrator of TSA has the authority to issue a security
+directive to focus on that threat and to require security
+measures to address that specific threat.
+ Mr. Correa. So, Ms. Proctor, you are saying because of the
+characteristics of cyber attacks that specific regulations
+would be counterproductive in this area?
+ Ms. Proctor. Yes, Mr. Chairman. The nature of cyber threats
+is that they are constantly emerging. They are emerging--much
+faster than the Government's ability to write regulations to
+address them and in this fashion if there is a significant
+cyber threat the administrator may address that through a
+security directive.
+ Mr. Correa. Any thoughts about how you would keep us as
+policy makers apprised of your progress or lack thereof since
+you are looking at really voluntary standards, self-reporting?
+ Ms. Proctor. Mr. Chairman, we would be happy to report to
+this committee on our progress with industry on the progress of
+the assessments that we conduct with industry; we actually go
+out and conduct corporate security reviews, looking at the
+headquarters, planning, the planning for cybersecurity plans,
+physical plans, and we go out into the field and conduct
+assessments at critical facilities. We conduct critical
+facility, security reviews in the field and we are comparing
+what we see in the field to the agreed-upon Pipeline Security
+Guidelines.
+ Mr. Correa. Complying with the cybersecurity challenge can
+be very expensive, for the private sector or Government. So my
+question to you is, the private sector, do you see them
+complying voluntarily with what they have got to do? Which is
+to come up with the best practices, minimum standards or do you
+have to push folks to go in the right direction; do you have to
+push folks to do the right thing?
+ Ms. Proctor. Sir, what we have witnessed is that the
+voluntary approach has been very successful. We have found that
+the companies are making those investments in their own
+cybersecurity, as well physical security, and they are doing
+that to protect their ability to carry on their business as
+well so we do believe that it has been effective in this
+voluntary environment.
+ Mr. Correa. Quickly, another area, the realignment, TSA is
+realigning some of its functions. Can you explain to us how
+this realignment will affect surface transportation security?
+ Ms. Proctor. As a result of the realignment that
+Administrator Pekoske has directed, the Surface Division assets
+are going to shift over into the security operations area where
+they will join with our Transportation Security Inspectors who
+are already in the field, that Field Force is 200-plus strong
+so we will be combining our surface division--our current
+surface division assets with the 200-plus Transportation
+Security Inspectors in the field, they will be working with us
+in conjunction with our transportation security partners in the
+field.
+ Mr. Correa. Thank you very much.
+ I am going to yield the remainder of my time.
+ I will now recognize our Ranking Member for the
+Transportation Subcommittee, the gentlewoman from Arizona, Mrs.
+Lesko, for some questions.
+ Ma'am.
+ Mrs. Lesko. Thank you, Mr. Chairman.
+ My first question is for either Ms. Proctor or Mr. Kolasky,
+or both. Some have suggested that other Federal agencies take
+over the role of physical and cybersecurity for pipelines, such
+as the Department of Energy and I was wondering if one of you
+or both of you can comment on why you think that it is
+important that it remains under the purview of TSA and
+Department of Homeland Security?
+ Ms. Proctor. Thank you, Ranking Member. We do believe that
+the security of pipelines is best placed under the Department
+of Homeland Security and the assets that the Department of
+Homeland Security can bring to bear for the security of the
+pipelines.
+ As has been mentioned here today, we are working very
+closely with CISA to conduct comprehensive cybersecurity
+assessments on pipelines and the authority that I mentioned
+that the administrator, the TSA administrator has, gives him
+the authority to require whatever measures are necessary to
+secure the pipelines to be implemented almost immediately at
+his direction, to secure the pipelines from any type of threat,
+whether that threat is a cyber threat or whether it is a
+physical threat.
+ Mr. Kolasky. If I could just add to that, Ranking Member
+Lesko, you know, one of the things we recognize, Sonja, and I,
+and our offices recognized is that we have some unique
+capability across DHS that we can apply to the pipeline threat
+and within the agency, the partnership we have established has
+really served as a force multiplier to TSA cybersecurity
+efforts.
+ The other thing I would augment that with, why I think this
+is a good place for it to be, is the fact that a lot of the
+nature of these risks, the control systems, the fact that
+pipelines contribute to other critical infrastructures are
+cross-sector and we really are a place and we serve as the hub
+to bring information across sectors when we learn about risks
+to some operational technologies, we can quickly get it in the
+hands of TSA, to get out to the pipeline owners and operators,
+we work together on that.
+ There's just a lot of shared risk in this space and
+separating critical infrastructure, too much across agencies
+you know, really runs the risk of creating stovepipes. I mean,
+right now we have got a nice blended mix of working with
+agencies, we work closely with the Department of Energy but I
+don't think you want to take cybersecurity responsibilities out
+of DHS and put them further afield because of that they are
+more just challenge----
+ Mrs. Lesko. I have one more question for, Ms. Proctor. Let
+me just read this from my notes. Recently the GAO determined
+that, in a recent audit, determined that [inaudible] risk had
+failed to identify critical facilities due to a lack of clarity
+from TSA on defining of facilities' criticality. To remedy
+these challenges GAO recommended that the TSA administrator
+take 10 actions with which TSA concurred [inaudible] what
+actions have been taken so that these high risks are
+identified?
+ Ms. Proctor. Yes ma'am. Certainly, we have reviewed the GAO
+report. We concur with the recommendations that GAO offered and
+we are in the process now of addressing those recommendations
+that were made by GAO. As you noted there were 10
+recommendations that were made by GAO and four of those
+recommendations deal with the pipeline risk ranking tool that
+we used to help establish risk in the pipeline industry so we
+are diligently working on all of the recommendations but we do
+expect to have at least the first recommendation concluded
+within about 60 days.
+ Mrs. Lesko. Thank you, ma'am.
+ I yield back my time.
+ Mr. Correa. Thank you, Mrs. Lesko.
+ I now recognize the Chairman of the Cybersecurity
+Subcommittee, the gentleman from Louisiana, Mr. Richmond.
+ Mr. Richmond. I will pick up where the Ranking Member left
+off and, Ms. Proctor, your answer indicates that you will
+accomplish number 1 out of 10 in 60 days, what about the other
+9?
+ Ms. Proctor. Mr. Chairman, we are working on all of those
+10 recommendations at the same time. We have limited resources
+to work on all of them at the same time so we are working to
+address the ones that we know that we can satisfy and those
+involve, again there were 4 that were associated with the risk
+ranking tool, so we are working directly on those, as well as
+the one that addresses the policy that we need to put in place
+for the review of the actual guidelines.
+ Mr. Richmond. Let me just give you kind of an overview of
+my district, largest petrochemical footprint in the country. We
+are neighbors to chemical facilities. We have all of the major
+rail lines running through our communities and for the most
+part they are good corporate neighbors, good employers, and
+they pay well.
+ However when we look at the risk associated with that, we
+have to make sure we mitigate it because on those rail cars
+that come through our communities are dangerous chemicals and
+every other thing that you can think of. So when we are looking
+at this, are we communicating the best, do we have strategic
+partnerships set up? It is important to us and so as we talk
+about the cyber risk for, let us say rail, and our pipelines
+and our oil rigs and all of those, that now a lot of that is
+controlled electronically.
+ If you think about the BP disaster which was an accident,
+think of a BP disaster that was an attack, so how are we
+communicating with those companies? But have we done anything
+to make sure that those companies are holding their
+subcontractors in their supply chain to the same high standards
+that we want to hold them to?
+ Mr. Kolasky. So I can talk a little bit about of the nature
+of your question. As you know, you mentioned chemical, you
+know, through the CFATs regulation we put additional
+requirements on chemical security, some of the facilities that
+dealt with that. You know, you referenced the oil and natural
+gas industry which operates pipelines that produces a lot of
+what you are talking about; we work closely with the oil and
+natural gas industry, with the Department of Energy.
+ You know, specifically in terms of supply chain risk, we
+agree that this is an area that we have got to get deeper into,
+people understanding the supply chain, I think there's an
+understanding of that.
+ I referenced in my opening remarks a task force that we
+have established with critical infrastructure owners and
+operators which are focused particularly on threat information
+sharing, setting up processes through threat-based decision
+making, where should threat-based decision-making criteria be
+established, that will be an interagency process where we are
+able to get threat information out to help owners and operators
+make a decision about companies or products they might not want
+inserted in the supply chain; we are advocating, more deeply
+understanding what is in a supply chain, that is an important
+element.
+ But then there's also, it has to be mitigation steps, you
+know, are people [inaudible] again is that written in the
+expectation to do so in the contracts, that is the kind of
+stuff we are studying the Task Force to make recommendations to
+the Federal Government, how to do that for our own Federal
+networks but also for critical infrastructure owners and
+operators and what incentives will get people deeper in.
+ So you know, I would summarize a problem that we probably
+don't have enough information out there to help everyone be
+smarter buyers that could [inaudible] in talking industry we
+will understand why the information might not lead to the right
+decisions being made or us taking too much risk on, we don't
+want to deal with this by just cutting off things but we want a
+better understanding of risks that is being put into supply
+chains and when there are [inaudible] that could be put out
+there.
+ Mr. Richmond. Well, and I guess I will just say before Ms.
+Proctor takes a shot of it but think of passenger rail which is
+almost completely electronic, what are we doing to ensure the
+traveling public safety and do we have a sense of urgency
+understanding the risk that is out there?
+ With that, Mr. Chairman, I will yield back the balance of
+my time.
+ Mr. Correa. Thank you, Chairman Richmond.
+ The Chair will now recognize other Members for questions
+that they may want to ask.
+ In accordance with our committee rules, I will recognize
+Members who were present at the start of the hearing, based on
+seniority in the committee, alternating between Majority and
+Minority. Those Members coming in later will be recognized in
+the order of their arrival.
+ The Chair recognizes for 5 minutes, the gentlelady Ms.
+Barragan, from California.
+ Ms. Barragan. Thank you.
+ I am going to actually, going to follow up on a question
+that Congressman Richmond just asked. In December 2016 L.A.
+Metro received a terror threat from abroad. It led to
+heightened security and this terror threat was on a commuter
+rail station, one that went into downtown Los Angeles, impacted
+about a 150,000 riders a day on this line. So my question, it
+was very similar to what Mr. Richmond just asked, but didn't
+get an answer from. So I am going to follow up there.
+ When we talk about cybersecurity risk, to what degree are
+we considering the safety of the traveling public as well, and
+passenger rail and mass transit rely on computerized systems; a
+cybersecurity attack on the system could also mean risking the
+safety of the traveling public. What is being done to mitigate
+these risks to the public and both of you can answer.
+ Ms. Proctor. We provide both information and intelligence
+and that intelligence is delivered sometimes in an unclassified
+setting but it is also delivered in a Classified setting, that
+is one of the most important things that we do, is keeping the
+systems informed about the level of threat, the type of threat,
+which gives them the information that they need to apply
+mitigating measures to that particular threat.
+ In conjunction with the supply chain issues that my
+colleague mentioned, those issues put them in the best position
+to ensure the safety of the traveling public. Most of our
+transit systems have either their own law enforcement component
+or they have an agreement with their local law enforcement
+agency to provide security for the system. We have found them
+to be very engaged.
+ We have found them to be involved not only in receiving
+information not only from TSA but from our colleagues at the
+FBI, with the Joint Terrorism Task Force and with their
+[inaudible] to be effective. When we receive information that
+suggests that some threat is present in mass transit you will
+often see an increased visibility; uniformed law enforcement
+officers including the VIPER teams from TSA, the ground-based
+Federal Air Marshals who support our surface transportation.
+ We take that information very seriously and as soon as we
+receive information that suggests that there might be some
+threat to the system and whether that threat is physical or
+cyber, we reach out to those systems to make sure that they are
+aware so they can start to apply mitigating measures.
+ Ms. Barragan. Right.
+ Mr. Kolasky, do you want to add anything to that?
+ Mr. Kolasky. Yes. Let me talk to, specifically about the
+rail. So Sonya mentioned information sharing, we know a lot
+about cyber information, cyber things that might be happening
+but one thing we did, a couple years ago is work with the rail
+industry to attach cyber indicators, things that could be
+happening in terms of tactics, techniques of a cyber attack, to
+controls that would be most useful in a rail transit context.
+So you know, we took general information and we organized it by
+using the NIST Cybersecurity Framework, working with industry
+where we could take specific indicators and say, if you see
+this sort of stuff, here's what you might want to do in a rail
+system, it is--it is that customization that helps.
+ Then I would just add on the physical security which you
+referenced in 2016 and another thing we do DHS is you know, try
+to enhance soft-target security and technology development that
+can be deployed in transit settings you know, through our
+Science and Technology Directorate partnership with TSA and
+[inaudible] and do stuff through funding in transit systems so
+you know, we are getting better every [inaudible].
+ Ms. Barragan. Recruiting and retaining a skilled cyber work
+force is something the DHS and this committee has had a top
+priority to do. Historically CISA has struggled to fill
+important cybersecurity positions and I understand that TSA is
+also looking to grow its cybersecurity work force. Mr. Kolasky,
+does the new National Risk Management Center have enough of the
+right people to carry out the ambitious goals you described
+without depleting personnel from other parts of CISA?
+ Mr. Kolasky. We have all pledged not to cannibalize each
+other so I think that is a good strategy here.
+ You know, we started with a good basis of analysts who have
+experience, thinking about strategic risk, analyzing strategic
+risks, doing planning, but we will be continuing hiring as we
+go forward to establishing the National Risk Management Center,
+we have about 20 positions that we are in the process of
+filling so you know, as a director of an organization I always
+want more talent; we are going to be pushing for it. I think we
+have the ability to recruit people, becoming the Cybersecurity,
+Infrastructure Security Agency is motivating us to get better
+candidates; we are using tools, incentives to hire people and
+things like that, but we want to keep pushing.
+ Ms. Barragan. Yield back.
+ Mr. Correa. Thank you, Mrs. Barragan.
+ I will now call on the gentlelady from New York, Miss Rice,
+for 5 minutes for questions.
+ Miss Rice. I am familiar with one of the largest subway
+systems that we have in this country, New York City Subway
+System. It is a system that services 5.7 million people every
+single day, traveling through 472 subway stations and across
+662 miles of track--that is 1.8 billion people per year so I
+wonder if there is a strategy specifically. I need to look into
+this with the NYPD which I think is probably one of the premier
+law enforcement agencies that you work hand-in-hand with.
+ Is there a strategy, and more importantly in New York City
+where everyone is very impatient, and likes to get from Point A
+to Point B as quickly as possible? You know, after 9/11
+everything changed about how you travel, when you go into the
+airport.
+ Is there a public appetite for that kind of security system
+before you enter any system and I guess this is really a
+rhetorical question so that is just to throw that out there and
+I mentioned the impatience of New Yorkers because anything that
+slows down their travel is something that they will probably
+squawk about but you know, I would hate to have that be
+instituted after a terrible tragedy happens where the appetite
+might be more [inaudible] another thing, I'd like to ask you
+about is China's growing footprint in the United States.
+Industrial supply chain and infrastructure. They are rooted in
+part by the emergence of the state-owned China Railway Rolling
+Stock Corporation, CRRC for short, which I am sure you are all
+well aware but they have won 4 out of 5 large U.S.
+transportation [inaudible] has won contracts with the
+Metropolitan transportation authorities in Philadelphia,
+Boston, Chicago, and Los Angeles.
+ Another source I believe of the anxiety around these
+acquisitions concerns is the development that CRRC won these
+contracts by placing low bids. Many critics point to the fact
+that the company receives support from Chinese government
+through state subsidies which other contractors do not.
+ But also you know, you have Members of Congress, the
+Pentagon, and industry experts that have stated concerns about
+China's capabilities in deploying Chinese manufactured subway
+railcars to engage in cyber espionage and surveillance, similar
+to the Government's concern when it comes to Huawei in the
+telecommunications field. What is the level of concern that
+either one of you have? You know, and I guess this is a supply
+chain question as well, but it seems to me that this is like a
+big red flag; I know that New York does not contract with CRRC
+but just your thoughts on that, it seems like just such a huge
+red flag.
+ Mr. Kolasky. So two versions of thoughts. One thing that we
+have to do, what we can to protect our information to not allow
+China to use business information. [inaudible] There is an
+increased threat and risk out there.
+ If you ask our specific concerns about any one of these, it
+is less about whether it is CRRC or anything, it is about
+practices that have been put in place to make sure that risk
+isn't being introduced into the system.
+ So you know, this really comes into procurement questions,
+do we have tight procurement, let us please not go with the
+lowest bidder price-wise if you are a Metro Transit Authority,
+let us make sure that they hit pretty tough security
+requirements and then you can make a price-based decision but
+the security requirements have to be built into the contracts,
+part of those security requirements is looking at the
+manufacturing, where the manufacturer's going, getting eyes on
+as a procurer with technical expertise to make sure risk isn't
+being introduced at the point of manufacturing [inaudible] how
+you set up the maintenance so I don't want----
+ Miss Rice. Do you set up those requirements or at least the
+laundry list of things that States and municipalities should
+look at. How many States adhere to them?
+ Mr. Kolasky. So, I mean, we are still in the process of
+working with the Transit Authorities. We had a conversation on
+Friday where we shared some intelligence information around
+that to help make decisions. Right now, I think there's an
+opportunity for companies to put greater requirements into
+procurement language, that is something that the TSA and us
+will be working with the industry on.
+ Miss Rice. So what would be the pushback against adhering
+to your guidelines?
+ Mr. Kolasky. I think when you talk to chief operating
+officers, security officers, they want to do that, it is
+pressures that they get from other pressures in----
+ Miss Rice. With costs?
+ Mr. Kolasky. Yes. So you know, we understand that these
+decisions are trade-offs. We want to be in the side of pushing
+hard for security, recognizing that there are other pressures,
+the business in the Transit Authority space.
+ Miss Rice. Whether it is interference in our election
+process which is well-documented. I mean, we have so many
+vulnerabilities across so many fundamental infrastructures in
+this country that we have to have a serious conversation about
+this and I just think that if you are going to set up
+guidelines, we have to try to understand why States are not
+going to adopt them and abide by them, if you are the agency
+from whom they are supposed to be getting this?
+ Mr. Kolasky. Sure there is good procurement in there.
+ We agree you know, we will set the guidelines, we will help
+them do that. When security-based procurement decisions or
+informed procurement decisions are not happening, that is where
+the Executive branch and Legislative branch should have a
+conversation about what are the limitations for that happening.
+ I don't know, I don't want vulnerabilities to turn into
+risk, they are vulnerabilities as you said but let us really
+take a risk-based approach to where the priority should before
+activity.
+ Miss Rice. When you come up with those guidelines, what
+data are you using to kind-of push that information out, what
+are you basing your concerns on in terms of the supply chain,
+the procurement process?
+ Mr. Kolasky. Based on, first of all, seeing systems, so
+where we see vulnerabilities let us stick with elections
+perception, we have gone out and we have worked with States and
+counties to look at their election systems, see some common
+vulnerabilities, we do that.
+ Also working with the vendors in areas to understand you
+know, areas where additional guidelines would help their own
+security side and taking advice through these protected
+conversations, through the Critical Infrastructure Partnership
+Advisory Council structure, we are hearing me, as somebody who
+wants to make a security decision, do not feel like I have all
+the information I need to make a security decision. So it is
+these conversations that help us.
+ Miss Rice. Do you have anything that you want to add?
+ OK.
+ Thank you. I yield back.
+ Mr. Correa. Thank you, Miss Rice.
+ I will call in the gentleman from Rhode Island, Mr.
+Langevin.
+ Mr. Langevin. Thank you, Mr. Chairman.
+ I want to welcome our witnesses here today and thank you
+for your testimony.
+ Before I begin, I just want to mention I concur with
+Chairman Thompson [inaudible] keep the pipeline, cybersecurity
+in the realm of TSA and not see it shipped over to DOE so I
+think that is an important point to make and I am glad that it
+is been raised here today.
+ Obviously with all this and I think this hearing is
+essential to focus on transportation security especially to
+cybersecurity, these are the things that keep me up late at
+night you know, as you know, where is the most damage that can
+be done is in the area of critical infrastructure, in a number
+of fields and so one of the aspects I want to focus on today is
+on pipeline security and obviously you need the right policies
+and procedures and plans put in place, you need the right
+people with the right expertise.
+ So, Ms. Proctor, let me start with you, December 2018 GAO
+report indicated that staffing in the Pipeline Security
+Division was a major challenge with a number of empties ranging
+from 14 all the way down to 1, across several fiscal years.
+What is the current staffing level of the Pipeline Security
+Division?
+ Ms. Proctor. Today the current staffing level is 5 but I
+think it is important to say that with the realignment that has
+been directed by the administrator, we will be shifting into
+the Security Operations organization where we will have the
+benefit of the additional Transportation Security Inspectors in
+the field. You know, there are 200-plus of them that will serve
+all of surface transportation so our Pipeline Section will be
+much larger, we will draw from that pool of Transportation
+Security Inspectors to provide the training and the experience
+to put them in the Pipeline Section.
+ Mr. Langevin. How many do you estimate will be in and
+specifically dedicated to pipeline security, or are you talking
+about, they are going to be leveraged across all those fields
+and from time to time they will rotate into the pipeline
+security, I am not clear on your answer?
+ Ms. Proctor. Well, we think the Pipeline Section is going
+to require specialized training so we are going to put those
+people in there, provide the training and make sure that they
+are qualified to go out and do those assessments.
+ We have not arrived at a final number yet, we are still
+working on some of the staffing issues or the shifting of
+personnel because it will serve all of our surface
+transportation partners in a way that is going to allow us to
+put more people in the field working directly with our surface
+transportation partners.
+ Mr. Langevin. So of the 5 that you mentioned, those staff,
+how many have expertise in cybersecurity specific?
+ Ms. Proctor. I am sorry we have none that have specific
+cybersecurity expertise. They do have pipeline expertise but
+not cyber expertise.
+ Mr. Langevin. I find that a troubling answer but let me ask
+you, across all TSA services, service transportation of course,
+how many specialize in cybersecurity?
+ Ms. Proctor. TSA does not have cybersecurity specialists.
+We rely on our colleagues at CISA for cyber expertise. I mean,
+that is a specialized field so we do rely on the DHS experts to
+provide that input and they have, we work directly with them
+when we were developing the Pipeline Security Guidelines, and
+got input from them to develop the current Pipeline Security
+Guidelines that have a cybersecurity section in them.
+ Mr. Langevin. OK. So we will stay on the topic of pipeline
+security, approximately how many Critical Pipeline Systems are
+there again in the United States? You maybe talked about this
+earlier on, but----
+ Ms. Proctor. That number varies depending on mergers and
+acquisitions, the number we work with is somewhere around a
+120.
+ Mr. Langevin. OK so I [inaudible] at end of the year, I
+mean, in your view given the number of pipelines that we are
+talking about, is that adequate? Because it does not seem so to
+me.
+ Ms. Proctor. I don't want to suggest that those are all of
+the pipeline assessments that we do so we still do critical
+facilities, security reviews and those are separate from the 10
+comprehensive cyber assessments that we are doing with CISA so
+we will continue to do those critical facilities security
+reviews. We completed 62 of those last year, even given the
+resources that we are working with now, but the 10 that we are
+referring to are going to participate in the Comprehensive
+Cyber Security Assessments that we are doing with CISA.
+ Mr. Langevin. OK, before my time runs out, I want to ask
+you, Ms. Proctor, again the TSA Cybersecurity Roadmap provides
+for the development of an implementation plan to see it put
+into practice so had the actual implementation plan then
+developed?
+ Ms. Proctor. We are in the process of developing that plan
+now. You know, we recognize the priorities in the cybersecurity
+plan and the value that it is going to bring to us in surface
+transportation. That plan is relatively new but we are
+reviewing that plan now to determine how we can implement that
+in surface transportation.
+ Mr. Langevin. When do you think the plan will actually be
+finalized and is Congress going to be provided a copy of that?
+Because we would like a copy.
+ Ms. Proctor. We would be happy to provide a copy of that
+finalized plan and I can certainly provide you an update on
+when--when we believe that is going to be finalized. As
+indicated, we are working through a number of requirements
+right now including the GAO requirements so we are working on
+all of those concurrently.
+ Mr. Langevin. All right. Before my time runs out, I just
+want to ask this though, how do you expect the [inaudible] with
+the roll-out of the Roadmap and what additional resources, if
+any, are required to carry out the new plan once it is
+finalized?
+ Ms. Proctor. The Cybersecurity Roadmap is going to require
+more coordination with CISA and we will have to determine the
+resources based on how we see that plan rolling out and how we
+see it being implemented across all of the surface
+transportation modes, but we have been working very closely
+together, so those are some things that we are going to have to
+continue to work and to ensure that we can carry out the
+administrator's intent on that plan.
+ Mr. Langevin. But the resources are going to be factored
+in, and actually as the plan is finalized you are working
+through those additional resource requests now as well?
+ Ms. Proctor. I am sorry, I didn't----
+ Mr. Langevin. You are planning for additional resource
+requests once the plan is finalized, is what I am hearing you
+saying, correct?
+ Ms. Proctor. Yes sir.
+ Mr. Langevin. OK.
+ Thank you very much.
+ I will yield back.
+ Mr. Correa. Thank you, Mr. Langevin.
+ Now would like to call the gentlewoman from New Jersey,
+Mrs. Watson Coleman, for 5 minutes of discussion.
+ Mrs. Watson Coleman. Thank you, Mr. Chairman.
+ Thank you very much for your testimony. What is the
+greatest threat from a cybersecurity attack on the pipeline? Is
+it that it would cut the flow of the natural gas or is it that
+it would blow up, what is it?
+ Ms. Proctor. So we recognize that the threats to pipeline
+from a cyber perspective do exist. Most of our significant
+pipelines are controlled to some extent by computer systems
+that manipulate valves and switches and controls----
+ Mrs. Watson Coleman. Right.
+ Ms. Proctor. So that impact would more likely affect the
+operation of the system. We would assume that it would affect
+more the operation of the system, the flow perhaps of the
+commodity.
+ Mrs. Watson Coleman. Is there any other kind of threat that
+could result in either a leakage or an explosion that could be
+triggered by some nefarious actors?
+ Mr. Kolasky. So I think we would like to have a follow-up
+conversation with you about threats where we can be more
+specific in a different setting. I don't mean to put you off--
+--
+ Mrs. Watson Coleman. OK.
+ Mr. Kolasky. But I think that is more appropriate.
+ Mrs. Watson Coleman. Thank you, because I am concerned. Do
+you work with FERC at all?
+ Ms. Proctor. Yes ma'am, we do.
+ Mrs. Watson Coleman. Because in New Jersey, in my district,
+there's a PennEast pipeline and I visited a home and the
+pipeline is going through that person's yard and as close as
+you are to me, is as close to the pipeline is to the woman's
+bedroom and so things like that concern me about the siting of
+these pipelines but in addition FERC hasn't had the
+responsibility, the requirement of saying whether the pipelines
+are in the vicinity and that could be somehow accessed so that
+we don't have so many pipelines, we just have the efficiency
+that we need and you don't deal with that issue with FERC at
+all in terms of siting, right?
+ Ms. Proctor. No ma'am. We don't deal with the issue of
+siting at all. We do work closely with FERC and we have
+conducted Cyber Architecture Assessments with FERC so----
+ Mrs. Watson Coleman. But that is not proximity. That is not
+location, that is infrastructure, right?
+ Ms. Proctor. Correct.
+ Mrs. Watson Coleman. If we have to have this conversation
+in another setting but we keep talking about the
+vulnerabilities that exists either in supply chain or in
+cybersecurity or in any way impacting the safety and security
+of any rail transportation, any pipelines and we say that we
+are doing things to advise our clients, whomever of these
+vulnerabilities.
+ Can you tell me in this setting: (A) How we identify these
+vulnerabilities, and (B) how does the procurer ensure that
+there's language or whatever that protects that item that they
+are purchasing that is being built by China or anybody else? Is
+that something that we can discuss here?
+ Mr. Kolasky. Yes. To some extent. I mean, first of all, I
+want to reinforce that most of these worst-case scenarios,
+there is a lot of fail-safes, there's layered defenses broken,
+built in here and you know, one of our overall strategies is to
+get better, better, better to make this stuff, the worst case
+that you are imagining, incredibly complex and only
+accomplishable by having physical access or doing things that
+are likely to be picked up by a Layered Defense System.
+ So first and foremost strategy, it is better understanding
+what is already put in place and putting in places to share
+information as quickly as possible. When you make something
+really complex just like with a terrorist attack, you are more
+likely to see the plotting that is going on there----
+ Mrs. Watson Coleman. Yes.
+ Mr. Kolasky. We have come a long way in that direction. Our
+adversaries might continue to get better but you know----
+ Mrs. Watson Coleman. Yes.
+ Mr. Kolasky. By making things complex is a good risk
+management strategy.
+ Mrs. Watson Coleman. But I also want to know that when you
+are purchasing rail cars, what is it that you tell the agency
+that is advertising, these specific things are how you mitigate
+the possible compromising of the safety and security of your
+car or whatever?
+ Mr. Kolasky. Sure. So----
+ Mrs. Watson Coleman. And----
+ Mr. Kolasky. At the basic level we give them an overview of
+business practices of companies and links to Chinese
+intelligence doctrine, things that are available to understand
+that there may be----
+ Mrs. Watson Coleman. I am going to assume----
+ Mr. Kolasky. Risks introduce into the system and then we
+talk through what good procurement strategies are.
+ Mrs. Watson Coleman. I want to assume, worst-case scenario,
+that we are purchasing cars from a company that means us no
+good. I want to know specifically how do we protect against
+that--what do we look for specifically to make sure that
+whatever thing is that might compromise the safety of that car
+and its passengers. How do we see it, how do we know it, how do
+we look for it? [inaudible]
+ Mr. Kolasky. It leads to a follow-on discussion.
+ The last thing I would say is that one of the things we are
+bringing in from a procurement perspective is the Federal
+Government as a whole has experience in procuring things that
+are really, really important to us and need to be secure and so
+part of what we can do with DHS working with some of our folks
+who do even bigger procurement is bring some of those
+practices, share that with industry around so the relationship
+with us and DOD and that sort of--in the testing that goes on
+in National Labs, that stuff's really important to get to----
+ Mrs. Watson Coleman. OK.
+ Mr. Kolasky. The level of fidelity you want.
+ Mrs. Watson Coleman. So I thank you.
+ My time is up and I just want to say, Mr. Chairman, I
+somehow would like to have a discussion in another environment
+as to exactly what these things are.
+ Mr. Correa. I would love to do that, if we can I will.
+ Mrs. Watson Coleman. Thank you very much.
+ Mr. Correa. I will talk to the staff and, Mrs. Watson
+Coleman, let us see if we can do that.
+ Thank you very much and recognize Ms. Slotkin for 5 minutes
+of questions. Thank you.
+ Ms. Slotkin. Yes. Hi, sorry to be late. I apologize. I am
+happy to be the only one at this giant table down here.
+ I apologize if this is slightly repetitive. I like the--
+some of my other fellow Congress men and women, have pipelines
+going through my district, some of them extremely close to the
+homes, many of them the route had been changed without the
+citizens' awareness and there's a lot of citizens who are
+concerned about their safety, as we all would be.
+ So can you just walk me through in sort-of clear terms No.
+1, what you have done to prevent cyber attack and then No. 2,
+if there's a specific threat or a risk; I am from the
+intelligence community, former CIA officer and was definitely
+aware that there was plenty of time, there were Classified
+information, threats, concerns, new techniques, that were
+Classified so we couldn't actually communicate with local
+businesses, with local communities, local law enforcement, even
+on the real nature of the threat so what have--what are we
+sort-of doing to protect ourselves and then tell me about your
+modus operandi on presenting information down to unclassified
+users?
+ Ms. Proctor. So with regard to the threat and this goes
+back to our information sharing. Two weeks ago, I believe we
+had a Classified briefing with members of the industry. It was
+a Top-Secret Classified briefing to talk about the threat. As a
+matter of fact, tomorrow we have another meeting with another
+Classified briefing with industry so we have found ways with
+our intelligence colleagues of providing the necessary
+information that our industry partners need in order to protect
+their industry from cyber threats so from the intelligence
+perspective we have been able to manage that with our
+intelligence partners.
+ I don't believe that there has been an unresolved issue
+with the intelligence that we are providing. We are providing
+everything that we can provide in the appropriate atmosphere,
+with people who have the appropriate clearances so in terms of
+the information I believe that we are getting that out to the
+right people.
+ Mr. Kolasky. And----
+ Ms. Proctor. On the--cyber side, I am going to let----
+ Mr. Kolasky. You referenced community-level law
+enforcement, and this is where the fusion centers, the DHS,
+sponsors, come in very handy, there are somewhere around 85
+around the country and both with industry but more particularly
+with law enforcement and people who have been close to
+community-level decisions [inaudible] teleconferences and
+things like that.
+ Then implied in your question, obviously is not everyone is
+going to have a clearance no matter how good we get at doing
+that so you know, we want to push, giving more out, the
+unclassified assessment, as you probably can guess what was in
+the Worldwide Threat Assessment that Director Coats talked
+about, that takes a while to get that statement to be made but
+that statement becomes important because it lights a fire on
+the importance of this issue and we have been following up with
+industry both in the Classified and unclassified community
+space with that.
+ Ms. Slotkin. So related to that, if there was an incident
+and because of declassification or problems with sharing, that
+information did not get to the company, who is the senior
+accountable official, who would be responsible for that mishap,
+would it happen?
+ Mr. Kolasky. We within CISA have the ability to give
+private-sector clearances out so we will facilitate private-
+sector members getting access to information, depending on the
+nature of the information you are talking about it is on us as
+a Government, who have that information to give as quickly as
+possible to the cleared community. I am not going to speculate
+on the exact hypothetical--it is our job to make sure we have
+opened up the channels to give Classified information.
+ We in other parts of the Government also have 1-day reading
+authorities where if you don't have a clearance but you need to
+have this information and so you know, I think we all feel
+obligated to make sure that information gets in the hands of
+somebody who could do something as soon as possible once we
+know that is credible information.
+ Ms. Slotkin. OK. I would just say, again CIA and FBI
+weren't communicating particularly well during 9/11. There has
+to be accountability if there's mistakes; I am not saying
+anyone's you know, God forbid, planning for mistake but it is
+nice to know that you know, who is responsible for making sure
+we pushed down this information to industry.
+ But I will yield back the rest of my time.
+ Mr. Correa. Thank our witnesses for your comments.
+ Now if I may, I would like to take a 5-minute recess and
+then come back and start with our second panel.
+ Members please try to be back in 5 minutes. Thank you very
+much.
+ [Recess.]
+ Mr. Correa. The committee will now come to order.
+ We will start with our second panel.
+ Our first witness is Mr. James Lewis, serves as senior vice
+president and the director of the Technology and Public Policy
+Program at the Center of Strategic International Studies.
+ Next we will have Ms. Rebecca Gagliostro, my apologies, who
+is the director of security, reliability, and resilience at the
+Interstate Natural Gas Association of America which is
+comprised of 27 members representing a vast majority of
+interstate natural gas transmission pipeline companies.
+ Next, we will have Mr. Erik Olson, who is a vice president
+of the Rail Security Alliance, which is a coalition of North
+American freight, rail car manufacturers, suppliers, unions,
+and steel interest.
+ Finally, will have Mr. John Hultquist, who serves as
+director of intelligence and analysis at FireEye. He has over
+10 years of experience, covering cyber espionage, hacktivism,
+and has worked in senior intelligence analyst positions in the
+Department of State.
+ Without objection the witnesses' full statements will be
+inserted to the record.
+ I will ask now each witness to summarize their statements
+for 5 minutes, beginning with Mr. Lewis.
+ Thank you, welcome sir.
+
+STATEMENT OF JAMES A. LEWIS, SENIOR VICE PRESIDENT, CENTER FOR
+ STRATEGIC AND INTERNATIONAL STUDIES
+
+ Mr. Lewis. Thank you. I thank the committee for the
+opportunity to testify.
+ We have entered an era of connected devices sometimes
+called the internet of things that offers real economic benefit
+but comes with increased risk to homeland security and much of
+this risk comes from the global supply chain. Most
+infrastructure and transportation systems as you have heard are
+connected to the internet in some way and depend on computers
+for their operation. This includes electrical power systems,
+pipelines, telecommunications and increasingly vehicles which
+continuously connect back to their manufacturer wherever that
+manufacturer is located and these connections provide
+opportunities for espionage and service disruption.
+ As the committees have heard for many years, the state of
+cybersecurity remains poor. Most networks can be hacked, cyber
+crime continues to grow, and cyber attack is an essential part
+of state conflict.
+ Our task is to mitigate risk. One way to do this is to ask
+how a device connects to the internet, what information it
+transmits, and how much transparency and control an operator
+has over this data and connection.
+ Another way is to use three metrics: The value of data
+collected; the critical [inaudible] variable data; perform
+critical functions or whose disruptions could produce mass
+effect, need to be held to higher standards.
+ Currently the internet of things is probably more
+vulnerable to disruption than the regular good old internet.
+For critical infrastructure we can ask how we would continue to
+operate in the event of a malicious incident and to what degree
+our control over these infrastructures are shared with a
+foreign manufacturer.
+ Products from China require special attention. The
+combination of increased Chinese espionage, new national
+intelligence law on China, pervasive surveillance, and
+heightened military tensions have led to a dangerous situation
+but the United States and China share a deeply integrated
+industrial base, disentangling this would be costly, although
+some now talk of a divorce. China is not the only country that
+could exploit cyber vulnerabilities and critical
+infrastructure. Iran and Russia have probed pipelines and other
+infrastructures, including electrical power.
+ There are several steps we can take to reduce risk. The
+most obvious is to improve network and device security. DHS's
+Cyber and Infrastructure Security Agency, CISA, should be the
+center of this effort.
+ The development of security standards is essential. The
+NIST Cybersecurity Framework is a strong start but it needs to
+be amplified and expanded for specific technologies. Any
+defensive measure must accept that we cannot keep a determined
+opponent out of our networks. This means that we must also
+consider measures to increase resiliency and allow for
+continued operation, integrated environments; this is the goal
+that DOD has. Better security requires oversight. This is
+clearly a task for the committee but also for CISA.
+ Finally, a defensive approach by itself is inadequate. The
+United States needs to develop credible threats to deter
+foreign attackers and persuade them that interference in
+critical infrastructure comes with the unacceptable risk of
+retaliation. We do not have this now. That would be a useful
+thing to do.
+ We haven't talked about the security premium which is what
+many of us call it, it has come up several times [inaudible] in
+part because it is subsidized by the government. There might be
+a Chinese intent, it is worth looking at, this subsidy but it
+means for companies--and we see this particularly with Huawei--
+they must choose between buying cheap good equipment or more
+expensive equipment that is secure, and that is a difficult
+choice. I am not sure everyone will always come out in the same
+place.
+ Thank you for the opportunity to testify. I look forward to
+your questions.
+ [The prepared statement of Mr. Lewis follows:]
+ Prepared Statement of James A. Lewis
+ February 26, 2019
+ I would like to thank the committee for the opportunity to testify.
+My testimony will discuss the risks to homeland security from the use
+of Chinese technology and equipment.
+ Chinese companies face a serious branding problem in many
+countries. There is a level of distrust that has been created in good
+measure by Chinese government policies. The most prominent of these
+policies are China's aggressive mercantilism, its disregard for
+international law, its massive espionage campaign, and, for the United
+States, its announced intention to displace America and become the most
+powerful country in the world, reshaping international rules and
+practices to better fit the interest of China's rulers.
+ Espionage has been a part of the of the Sino-American relationship
+since China's opening to the West in 1979. It is worth remembering that
+at this time, the United States and China shared a common enemy--the
+Soviet Union. This created incentives for cooperation that have long
+vanished. Chinese espionage initially focused on repairing the
+disastrous effects of Maoist policies on China's economic and political
+development. This meant the illicit or coercive acquisition of Western
+technology. As China's cyber capabilities improved, beginning in the
+late 1990's, some PLA units turned to hacking as a way to supplement
+their incomes, moonlighting by stealing Western intellectual property
+and then selling it to Chinese companies.
+ The illicit acquisition of technology is still a hallmark of
+Chinese espionage activity, but there have been significant changes
+since President Xi Jinping came to power in 2013. One of the first
+things Xi did, reportedly, is order an inventory of Chinese cyber
+espionage activities. He found that many of these had not been ordered
+by Beijing, that Beijing did not have full control over tasking and
+assets, and some operations were for private interest and did not meet
+China's strategic requirements.
+ Xi changed this. The Chinese military has been reorganized as part
+of a larger effort to modernize the PLA. Xi's anti-corruption campaign
+greatly reduced the ability of PLA units to ``moonlight.'' Chinese
+intelligence collection is better organized, more focused on strategic
+priorities, and, some would say, better in performing its missions.
+This comes at a time when, according to the U.S. intelligence
+community, Chinese espionage has reached unprecedent levels. Today,
+these efforts focus on the acquisition of advanced military and
+commercial technologies, since China still lags the United States in
+technology, as well as military and government targets.
+ The United States and China reached an agreement in 2015 to end
+commercial cyber espionage, but it is generally believed that this
+agreement has broken down in the last year. At the risk of sounding
+overly dramatic, some would describe this situation as an undeclared
+espionage war between China and the United States. In fact, this is not
+a war, but a very intense contest where the United States is largely on
+the defensive. Our allies also face a similar problem with Chinese
+efforts in Australia, Japan, Germany, the United Kingdom, Canada, and
+other advanced economies.
+ These activities create distrust, and a more specific ground for
+distrust is China's 2017 National Intelligence Law. For some years, the
+United States had advised China to move away from an informal, ad hoc
+system of rules and put in place a formal legal structure based on
+laws. The Chinese took our advice and one result is that long-standing
+Chinese policies and practices have been codified into the 2017
+Intelligence Law. The most important part of that law for today's
+hearing is that it creates a legal obligation for Chinese companies to
+cooperate fully with intelligence agencies upon request. There are no
+grounds for appeal or an ability to refuse such requests.
+ This means that a Chinese company could be completely innocent of
+any wrongdoing, its products harmless, but a decision by the Chinese
+government could change that in an instant. In the context of an
+increasingly aggressive global espionage campaign, often conducted
+using cyber techniques, there are reasonable grounds for the distrust
+of Chinese products. The first question to ask is not whether you trust
+a Chinese company, but whether you trust the Chinese government.
+ Concerns over the Intelligence Law have become so significant, in
+part because of the implications of using Huawei telecommunications
+equipment, that China's official news agency felt obliged last week to
+put out a press release calling for a comprehensive and accurate
+translation. China's Foreign Ministry pointed out that while Article 7
+of the law stipulates the obligation for Chinese companies and
+individuals to ``support, assist, and cooperate'' with the country's
+intelligence service, Article 8 stipulates that China's intelligence
+service should carry out its work according to law, protect human
+rights, and safeguard the legal rights and interests of individuals and
+organizations. Unfortunately, this promise is undercut by China's
+recent behavior in regard to human rights and in the protection (better
+expressed as the absence of protections) for the intellectual property
+of foreign companies.
+ We should note that China's government expresses similar concerns
+over their reliance on Western technology, in part because they assume
+the relationship between Western companies and government is the same
+as the relationship between Chinese companies and the government. This
+official distrust of Western products is one reason why Beijing is
+spending billions of dollars to develop national sources of supply for
+many technologies. These subsidies also provide commercial benefit, in
+building national champions in Chinese industry and in eroding Western
+companies' market position.
+ China also leads the world in building a national system of
+pervasive domestic surveillance. Communications and social media are
+monitored, and an array of sensors monitor and record activities in
+urban areas. This sensor data is correlated with information held by
+the government on Chinese residents' behavior and communications. This
+pervasive surveillance is not popular among many Chinese, but it is
+increasingly difficult to escape. One concern is that China will to
+some degree extend this pervasive surveillance to countries and persons
+of interest outside of China or extend its extensive cyber espionage
+campaign to include coercive actions, like disrupting critical
+services. This is not something China would do lightly, but the risk
+cannot be dismissed.
+ The combination of increased espionage, new legal obligations,
+pervasive surveillance, and heightened military tensions make for an
+uncomfortable and potentially dangerous situation, with implications
+for U.S. security. The United States and China share a deeply
+integrated industrial base, constructed during the time when we assumed
+that China was moving in the direction of becoming a market economy and
+a security partner. Disentangling this deeply integrated supply chain
+would be costly and damaging to both countries, but some in America now
+talk about a ``divorce'' while China is spending heavily to reduce its
+reliance on the United States.
+ Beyond the espionage risk, there is potential risk for critical
+infrastructure that is growing. As more devices become connected to the
+internet and reliant on software, the opportunities for disruption will
+grow. This is not specifically a China problem, but a change in the
+technological environment as millions of devices connect to the
+internet in ways that China (or other malicious actors) could exploit
+for coercive purposes.
+ As the committee has heard for many years, the state of
+cybersecurity remains poor and almost any network or device can be
+hacked with enough persistence. Cyber crime continues to grow, and
+cyber tools have become an essential part of state conflict. If it is
+any consolation, China's cybersecurity is worse than ours, if only
+because of their frequent use of pirated software. Improving
+cybersecurity should be a potential area for cooperation between the
+two countries, but the current state of relations does not permit that.
+ An environment of connected devices, often called the internet of
+things, is formed by devices that connect to the global internet,
+usually without human intervention. We all have heard of smart cars but
+many large systems in infrastructure and transportation also rely on
+computers and connectivity. This environment will provide real economic
+opportunities and benefits, but it also comes with an increase in risk.
+Our task should be to estimate this risk and then develop strategies to
+mitigate it. Different technologies and different companies create
+different levels of risk, and there are several ways to assess this.
+ One way to scope risk is to ask how a device connects to the
+internet, what on-board sensors it has, what information it collects
+and transmits, and how much transparency, insight, and control an
+operator has over this data and connection. Many large capital goods,
+such as power technologies, pipelines, telecommunications and ships,
+are continuously connected over the internet to their manufacturer, to
+allow for status reports, maintenance scheduling, and for the updating
+of software. This continuous connection provides an opportunity to
+collect information and to disrupt services. Instead of an update, a
+command could be sent to turn off or to reduce speed.
+ We have seen several examples of Chinese devices that report home,
+from drones to surveillance cameras, with the concern that under the
+new intelligence law, the Chinese government could compel the provision
+of the data collected by these technologies. This kind of monitoring
+and collection has been a standard practice for intelligence agencies
+that will certainly extend to the internet of things, and the risks of
+connected devices is compounded when their home is in a hostile foreign
+power.
+ We could scope risk by measuring the cybersecurity status of
+connected devices. The National Institute of Standards and Technology
+(NIST) is developing, in partnership with industry, standards for the
+security of IOT devices. But this is still at a relatively early stage.
+In general, the internet of things will be no more secure than the
+existing internet and may be more vulnerable, since many IOT devices
+will use simple computers with limited functionality.
+ We can also assess risk by using three metrics--the value of the
+data accessible through or collected by the IOT device, the criticality
+of a function the connected device provides, and scalability of
+failure. Devices that create or collect valuable data, perform crucial
+functions, or that can produce mass effect, need to be held to higher
+standards and face greater scrutiny.
+ For critical infrastructure, we need to ask the same questions
+about using Chinese products that we would ask for any critical
+infrastructure protection policy: How sensitive are the operations and
+the data associated with or accessible through the infrastructure, what
+would happen if the infrastructure was disrupted by an opponent, how
+would we continue to operate and then recover in the event of a
+malicious incident, and for foreign products, and to what degree is
+control or access shared with the foreign manufacturer?
+ The type of data collected and transmitted is a crucial element of
+a risk assessment. Intelligence analysis data is driven by access to
+large amounts of data and the ability to correlate it with other data.
+Data analytics provides new intelligence insights. A well-known example
+is the hack attributed to China of the Office of Personnel Management
+(OPM) and the theft of personal information. It is likely that OPM was
+one of a series of related hacks, of insurance companies, airlines, and
+travel agencies, that provided additional data that could be used to
+gain insight into America, personnel and practices. This means that
+even seemingly insignificant data, if correlated with other
+information, may provide influence value. The more ``granular'' the
+data, and whether it refers to specific individuals, the greater its
+value. Less granular data, such as how many people are sitting on a
+train or at which stop they exit, may not pose much risk.
+ Managing our new competition with China will be difficult given the
+close interconnection between the U.S. and Chinese economies. This is a
+30-year commercial and technological partnership not easily dismantled
+by either side. Given the deep interconnections that have grown between
+the Chinese economy and the rest of the world, a bifurcation similar to
+that seen during the Cold War is not possible, and it is not now in our
+interest. A greater degree of separation between the two economies is
+necessary but must be carefully developed for specific technologies and
+based on a judgment on the risk that their use could provide China with
+an intelligence, military, or unfair commercial advantage.
+ These risks are manageable, and we have to contrast them to the
+risk to the America economy from a violent disruption of trade with
+China. Generally speaking, a complete divorce is not in our interest;
+and it is certainly not in China's interest. There are specific
+technologies and circumstances that require greater scrutiny and
+countermeasures, but this does not apply across the board (at least at
+this time). Working with our allies, we can modify China's behavior to
+make this relationship more stable and less risky. We have done so in
+the past, but this will be a process that will take years to complete,
+and in the interim, there are steps we must take to reduce the risk of
+Chinese interference and espionage.
+ The most obvious is continued work to improve network and device
+security. This will require some measure of regulatory action and close
+partnership with the affected industries and operators. One size does
+not fit all when it comes to regulation, so the potential risk of IOT
+and Chinese technology must be managed using the sector-specific model
+developed in the previous administration, and partnerships between
+companies, agencies with oversight, and DHS's new Cybersecurity and
+Infrastructure Security Agency (CISA) should be the core of this
+effort.
+ The development of security standards is a necessary complement to
+any regulation or voluntary action. The NIST Cybersecurity Framework is
+a good starting point for this but must be extended and modified for
+different kinds of transportation systems. CISA's Transportation
+Systems Sector Cybersecurity Framework Implementation Guide, published
+in June 2015, provides guidance to owners and operators on how to
+assess and implement cybersecurity standards.
+ All of these measures--voluntary action, regulation, and
+standards--must be predicated on the knowledge that we cannot keep
+opponents out of our networks and devices. We can make it harder for
+them but not impossible. This means that measures to increase
+resiliency, to allow for some level of continued operation in degraded
+conditions is essential. This adds expense to critical infrastructure,
+of course, and one part of any plan is to ask how this additional
+burden will be funded and whether the increase in risk is outweighed by
+the potential savings--we should not automatically assume that the mere
+existence of risk cancels out financial benefits.
+ All of these steps require oversight to assess risk and
+improvement. This is clearly a task for Congress and this committee,
+but also for the responsible agencies, industry bodies, and, in
+particular, for CISA. The key question for assessment is whether the
+use of the Chinese technology increases the risk of disruption or
+espionage, and the answer to this will depend in good measure on how
+the Chinese products connect to the internet.
+ Finally, a purely defensive approach will be inadequate. The United
+States needs to develop and articulate credible counterthreats to
+dissuade and deter foreign attackers. This may require more than
+sanctions and indictments. Although they are useful and have effect
+over the long term, they may need to be reinforced other punitive
+measures, part of a larger strategy on how to impose consequences and
+change opponent thinking. Given the level of vulnerability and the
+potential increase in risk from both the acquisition of foreign
+technology and the digitizing of critical services, we must persuade
+opponents that any interference will come with unacceptable risk or
+retaliation by the United States.
+ There are trade issues that I have not touched upon, such as the
+Chinese practice of building national champions through government
+subsidies and, in some cases, industrial espionage. China also uses
+non-tariff barriers and other protectionist mechanisms to hobble or
+block competition from foreign firms in China. These Chinese practices
+harm our National interests and should be opposed as part of a larger
+effort to change China's behavior and move it in the direction of
+reciprocity.
+ I thank the committee for the opportunity to testify and look
+forward to any questions.
+
+ Mr. Correa. Thank you, Mr. Lewis.
+ Now I would like to recognize, Ms. Gagliostro, to summarize
+her statements in 5 minutes.
+
+ STATEMENT OF REBECCA GAGLIOSTRO, DIRECTOR, SECURITY,
+RELIABILITY, AND RESILIENCE, INTERSTATE NATURAL GAS ASSOCIATION
+ OF AMERICA
+
+ Ms. Gagliostro. Thank you.
+ I am delighted to be here today to share our thoughts on
+cybersecurity in the pipeline industry. My name is Rebecca
+Gagliostro, director of security, reliability, and resilience
+at the Interstate Natural Gas Association of America.
+ INGAA is a trade association that advocates regulatory and
+legislative positions of importance to the Interstate Natural
+Gas Pipeline Industry. Our 28-member companies operate
+approximately 200,000 miles of interstate natural gas pipelines
+that are analogous to the interstate highway system. Like the
+highways that are the arteries for so much of our Nation's
+commerce, interstate natural gas pipelines are the
+indispensable link between U.S. natural gas producers and
+consumers.
+ In my role at INGAA, I work directly with our members to
+ensure that our pipeline infrastructure remains resilient,
+safe, and secure. Cybersecurity is a priority for the Natural
+Gas Pipeline Industry. INGAA member companies work worked
+diligently to secure our Nation's critical gas transmission
+infrastructure from both cyber and physical security threats.
+Cybersecurity has been identified as the top operational risk
+by the executive leadership of our member companies and we take
+the management of this risk very seriously.
+ Last year in recognition of this priority, INGAA's board of
+directors set forward with its commitment the Pipeline Security
+Statement. This Statement enumerates specific actions that all
+of our member companies are taking as part of their security
+program. The Statement emphasizes among other things, our
+commitments to following the Transportation Security
+Administration's Pipeline Security Guidelines.
+ Industry security efforts seeks to reduce the risk posed by
+successful attack targeting our infrastructure. A foundational
+element of a well-informed risk management program is
+comprehensive information sharing. This is the key point that I
+would like to emphasize. Real-time actionable information is
+vital to ensuring our pipeline operators are equipped with the
+latest intelligence on threats.
+ Information sharing is occurring today between INGAA member
+companies and other industry stakeholders through the work of
+our Information Sharing and Analysis Centers also known as
+ISACs, however this is not industry's responsibility alone. It
+is imperative that we also have a cooperative working
+relationship with our Government partners to help facilitate
+information sharing.
+ We would like to note that there is strong information
+sharing occurring today with our partners at TSA and the
+Department of Homeland Security and we would like to see this
+relationship continue.
+ INGAA believes that TSA's Pipeline Security Program is
+making a difference as it continues to improve. We understand
+that TSA has accepted the Government Accountability Office's
+recommendations for improving the management of its Pipeline
+Security Program and it is now in the process of implementing
+changes in response to those recommendations. INGAA strongly
+believes that if followed these recommendations will help to
+make a stronger and more robust program.
+ The increasing threat of nation-states cybersecurity
+attacks and interdependencies across our critical
+infrastructures means that we must work together across
+industry and Government to protect ourselves against threats.
+The work that TSA and the Department of Homeland Security are
+doing with the National Risk Management Center is a very
+positive step toward the end goal of protecting the Nation from
+cybersecurity threats.
+ Threats to critical infrastructure cannot be evaluated in
+isolation; all critical infrastructures are being targeted,
+therefore we must identify the best ways to work together to
+protect our National security.
+ In October, TSA and DHS announced their joint partnership
+in the Pipeline Cybersecurity Assessment Initiative which is
+working to conduct Comprehensive Cybersecurity Assessments to
+pipeline infrastructure. Assessments play a critical role in
+providing the assurance that these programs are working. TSA
+has already piloted one INGAA member assessment in 2018 and our
+members continue [inaudible] we believe that progress has been
+made in securing our pipeline infrastructure and we should
+continue to focus on improving TSA's Pipeline Security Program.
+ The growing threat of nation-state cyber attacks requires a
+coordinated and comprehensive approach backed by strong
+information sharing across all critical infrastructures sectors
+and across all Federal agencies supporting National Security.
+TSA's on-going work with the National Risk Management Center is
+helping to bridge that gap.
+ We urge Congress to support TSA's efforts to improve its
+program and provide the necessary guidance and funding for
+additional program-management staffing and cybersecurity
+expertise that can work alongside the National Risk Management
+Center and support the Pipeline Cybersecurity Assessment
+Initiative. We believe that this, in addition to the efforts
+that are already under way, will help to make TSA successful in
+its mission to protect the Nation's pipeline infrastructure.
+Thank you.
+ [The prepared statement of Ms. Gagliostro follows:]
+ Prepared Statement of Rebecca Gagliostro
+ February 26, 2019
+ Good morning Chairmen Correa and Richmond, Ranking Members Lesko
+and Katko, and Members of the subcommittees. I am delighted to be here
+today to share our thoughts on cybersecurity in the pipeline industry.
+I am Rebecca Gagliostro, the director of security, reliability, and
+resilience at the Interstate Natural Gas Association of America
+(INGAA). INGAA is a trade association that advocates regulatory and
+legislative positions of importance to the interstate natural gas
+pipeline industry in the United States. INGAA's 28 members operate
+approximately 200,000 miles of interstate natural gas pipelines that
+are analogous to the interstate highway system. Like the highways that
+are the arteries for so much of our Nation's commerce, interstate
+natural gas pipelines are the indispensable link between U.S. natural
+gas producers and consumers. In my role at INGAA, I work directly with
+our members to ensure that our pipeline infrastructure remains
+resilient, safe, and secure.
+Cybersecurity is a priority for the natural gas pipeline industry
+ INGAA member companies work diligently to secure our Nation's
+critical gas transmission infrastructure from cyber and physical
+security threats. The boards of directors and executive leadership of
+our member companies have identified cybersecurity as a top operational
+risk and take the management of this risk very seriously. Last year, in
+recognition of this priority, INGAA's board of directors stepped
+forward with its Commitments to Pipeline Security\1\ statement, which
+enumerates specific actions that all of our member companies are taking
+to identify, protect, detect, respond to, and recover from security
+threats targeting our systems. In addition, the statement emphasizes
+our members' commitments to following the Transportation Security
+Administration's (TSA's) Pipeline Security Guidelines and the National
+Institute of Standards and Technology's (NIST's) Cybersecurity
+Framework, and to engaging in comprehensive information sharing across
+the industry and with our Federal partners. These are the foundations
+to building and maintaining strong pipeline security programs.
+---------------------------------------------------------------------------
+ \1\ INGAA Commitments to Pipeline Security, https://www.ingaa.org/
+File.aspx?- id=34310&v=db10d1d2.
+---------------------------------------------------------------------------
+ INGAA's commitments provide a high-level roadmap of what our member
+companies are doing to secure our infrastructure, as appropriate for
+public dissemination. In practice, our members' security programs are
+far more extensive than the information that may be conveyed by these
+commitments. It is our firm belief that we must be continually vigilant
+and entirely committed to the on-going improvement of our security
+defenses because the adversaries seeking to harm infrastructure of all
+kinds, including natural gas pipelines, are nimble and the threats they
+pose are evolving.
+Pipeline operators take a risk-management approach to addressing
+ security threats
+ Industry security efforts seek to reduce the risk posed by a
+successful attack targeting our infrastructure. This risk-informed
+approach helps us prioritize our actions and allocate appropriate
+resources toward the highest priority. Pipeline operators utilize a
+variety of tools and resources, like the NIST Cybersecurity Framework
+and the TSA Pipeline Security Guidelines, to build well-rounded
+cybersecurity programs that effectively assess and manage the risks
+that we face. We recognize that cybersecurity risk management
+strategies must be comprehensive in nature and must implement measures
+to both reduce the likelihood of a successful attack and mitigate the
+impacts of a successful attack, should one occur. As such, pipeline
+operators assess their security programs using a variety of resources
+such as Federal assessment programs, self-assessments, peer reviews,
+and third-party vulnerability and penetration tests. Exercises and
+tabletops also play an important role in testing our security programs,
+sharing information with our peers about our security practices, and
+planning for how we will work across industry, interdependent sectors
+and with first responders during an incident.
+ A foundational element of a well-informed risk management program
+is comprehensive information sharing. This is a key point that deserves
+emphasis. Real-time, actionable information is vital to ensuring
+pipeline operators are equipped with the latest intelligence on
+threats, including known tactics, techniques, and mitigative measures.
+This, in turn, enables operators to evaluate their risks and tailor an
+approach that best fits the needs of their individual systems and
+environments. Strong information sharing already occurs today between
+INGAA member companies and other industry stakeholders through the work
+of our information sharing and analysis centers (ISACs), including the
+Downstream Natural Gas (DNG) ISAC and the Oil and Natural Gas (ONG)
+ISAC. However, this cannot be industry's responsibility alone. It is
+imperative that we also have a cooperative relationship with our
+Government partners to facilitate rapid information sharing. It is
+worth emphasizing that the pipeline industry has a strong information-
+sharing relationship with our partners at TSA and U.S. Department of
+Homeland Security (DHS). We would like to see this relationship of
+trust continue and develop, as we look toward these agencies to
+declassify threat intelligence and provide us with the timely,
+actionable information necessary to protect our systems and
+infrastructure.
+The Transportation Security Administration pipeline security program is
+ improving
+ The Aviation and Transportation Security Act (Pub. L. 107-71)
+(``ATSA'') vested the Transportation Security Administration with
+authority over pipeline security. Pursuant to this authority, TSA
+offers guidance on expected practices and procedures necessary to
+secure the Nation's critical pipeline infrastructure. TSA offers
+several programs, tools, and products to assist pipeline operators with
+protecting their infrastructure, including Critical Facility Security
+Reviews, Corporate Security Reviews, Pipeline Cybersecurity
+Assessments, Smart Practices, I-STEP, Security Awareness Training
+Videos, and the International Pipeline Security Forum.
+ TSA acknowledges that there remains room for improvement in its
+pipeline security program. The agency has accepted the recommendations
+for improving the management of its pipeline security program that were
+made by the Government Accountability Office and is in the process of
+implementing them. INGAA strongly believes that if followed, these
+recommendations will help to make a stronger and more robust program.
+ Following the tragic events of September 11, 2001, TSA's security
+program was rooted in the physical security threats targeting our
+critical infrastructure. As acknowledged in a recent statement by
+Director of National Intelligence Dan Coats, sophisticated nation-
+state-backed cybersecurity capabilities present a real threat to our
+critical infrastructure. These threats have led to increased emphasis
+by TSA and our sector on protecting pipeline infrastructure from
+cybersecurity threats. It is important to stress that these threats are
+faced by all critical infrastructure and not just natural gas
+pipelines. The increasing interdependence across the segments of our
+Nation's critical infrastructure means that we must work together
+across industry and Government to protect ourselves against these
+threats.
+ The work that TSA and DHS are doing through the National Risk
+Management Center (NRMC) is a very positive step toward the end goal of
+protecting the Nation from cybersecurity threats. These agencies are
+working together to understand how sophisticated, nation-state threat
+actors seek to identify ways to harm all U.S. critical infrastructure.
+We believe this approach is significant because these threats cannot be
+analyzed effectively in isolation. All critical infrastructure is being
+targeted; therefore, we must identify the best ways to work together to
+protect our National security.
+ In October, these agencies announced the Pipeline Cybersecurity
+Assessment Initiative, which is working to conduct comprehensive
+cybersecurity assessments of natural gas infrastructure to better
+understand the unique risks faced by our infrastructure as well as to
+identify how best to protect it. In addition to having a recognized
+baseline of practices, assessments are critical to providing assurance
+that these programs are working. TSA has already piloted one INGAA
+member assessment in 2018, and INGAA members continue to volunteer to
+participate in these new assessments in 2019.
+Next steps for building upon progress to secure pipeline infrastructure
+ INGAA believes that progress has been made in securing our pipeline
+infrastructure and that the focus should be on continuing to improve
+TSA's pipeline security program. Threat actors regularly develop and
+refine their tactics, and we must do the same. The increased
+coordination between TSA and DHS's Cybersecurity and Infrastructure
+Security Agency (CISA) through the NRMC is an appropriate response to
+the enhanced need for cybersecurity expertise to support industry's
+efforts to protect our critical infrastructure against these growing
+threats. We understand TSA has embraced GAO's recommendations as a
+roadmap for improving its pipeline security program and is already
+taking steps to respond to them.
+ INGAA and its member companies will continue to support TSA's
+efforts. This includes volunteering for assessments, sharing
+information about indicators of compromise and about how member
+companies are securing their infrastructure, and participating in
+cross-sector exercises so we can better determine how the different
+segments of critical infrastructure must work together.
+ The growing threat of nation-state-backed attacks requires a
+coordinated and comprehensive approach across all critical
+infrastructure and across all Federal agencies supporting National
+security. INGAA believes that TSA's on-going work with the NRMC and
+CISA is bridging that gap. We urge Congress to support TSA's efforts to
+improve its program and to provide the necessary guidance and funding
+for additional program management staffing and cybersecurity expertise
+that can work directly with the NRMC and support the new Pipeline
+Cybersecurity Assessment Initiative. INGAA believes that this
+supplement to efforts already under way will help make TSA successful
+in its mission to protect the Nation's pipeline infrastructure.
+
+ Mr. Correa. Thank you very much for your testimony.
+ Now I will recognize, Mr. Olson, for 5 minutes.
+
+ STATEMENT OF ERIK ROBERT OLSON, VICE PRESIDENT, RAIL SECURITY
+ ALLIANCE
+
+ Mr. Olson. Chairman Correa, Chairman Richmond, Ranking
+Member Lesko, and Members of the subcommittees, my name is Erik
+Olson, and I am the vice president of the Rail Security
+Alliance. The Rail Security Alliance is a coalition of North
+American freight rail manufacturers, suppliers, unions, and
+steel interests, committed to ensuring the economic and
+National security of our passenger and freight rail systems. On
+behalf of our coalition thank you for the opportunity to
+testify on the critical topic of securing our surface
+transportation systems against cyber and privacy threats.
+ With thousands of miles of railroad covering the United
+States, freight rail regularly transports everything from
+sensitive U.S. military equipment, to toxic and hazardous waste
+every day. On the passenger side millions of Americans rely on
+the commuter rail system daily. U.S. Rail System is also highly
+sophisticated, relying on a constantly expanding network of
+technology that dramatically increases its risks to cyber
+attack and hacking.
+ Today I want to draw the committee's attention to a
+particular threat arising from foreign investments in this
+industry that jeopardizes directly the future of America's
+Passenger and Freight Rail Systems. This threat is China.
+ China is strategically targeting the U.S. rail
+manufacturing sector with aggressive anti-competitive tactics
+and how do we know that? Well, to date they have secured 4 U.S.
+metropolitan transit contracts in Boston, Chicago,
+Philadelphia, and Los Angeles, largely by utilizing anti-
+competitive under-bidding practices. These aggressive and anti-
+competitive activities are not unusual for China state-owned
+rail sector and raise grave National concerns, security
+concerns that demand immediate attention.
+ Without decisive action America's industrial, military, and
+other Government interests could be forced to rely
+significantly or wholly on rail cars made by the Chinese
+government thus creating massive cyber vulnerabilities that
+threaten our Nation.
+ The Made in China 2025 Initiative, a key component of
+China's 13th 5-Year Plan identifies the rail manufacturing
+sector as a top target for Chinese expansion. This initiative
+has systematically and deliberately driven strategic investment
+and financing activities of the state-owned China Railway
+Rolling Stock Corporation, CRRC, in third-country markets and
+the United States. CRRC is wholly owned by the government of
+China. It has 90 percent of China's domestic market for
+production of rail locomotives, bullet trains, passenger
+trains, and Metro vehicles.
+ In just the last 5 years alone in the United States, we
+have witnessed CRRC execute a business strategy to take market
+share in the U.S. transit rail manufacturing sector deploying
+near-limitless financing from its home government, allowing
+CRRC to establish itself as a formidable force in the U.S. rail
+transit manufacturing base.
+ Emboldened with these contract victories, CRRC continues to
+target other U.S. cities including our Nation's capital. In
+September the Washington Metropolitan Transit Authority, WMATA,
+issued a request for proposal for the new 8000-series Metro
+Car. This RFP includes numerous technologies which are
+susceptible to cyber attacks. Whoever is selected to supply
+rail cars for WMATA will become a partner in the day-to-day
+operations of a Metro System whose stops include the Pentagon,
+the Capitol, as well as unfettered access to D.C.'s tunnels and
+underground infrastructure. As CRRC itself has stated, their
+objective is to conquer the rest of the global rail market--
+need I say more? Whether they be State, local, or Federal
+funds, American taxpayer dollars should not be used to
+subsidize the activities of a Chinese state-owned enterprise
+and compromise American security.
+ Based on the experiences of Australia, which this graph
+denotes, whose domestic industry, CRRC was able to wipe out in
+under a decade, we are equally concerned that CRRC will
+leverage its growing presence in the U.S. transit rail
+production to then pivot into freight rail assembly; we cannot
+allow this to happen here.
+ [The information follows:]
+
+[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
+
+ Mr. Olson. Yet the Department of Homeland Security deems
+the U.S. rail sector as a part of the Nation's critical
+infrastructure, running through every major American city and
+every military base in the Nation. We have had extensive
+discussions with representatives from DOD and based on those
+discussions, I am confident that the Secretary of Defense will
+express his concerns on this matter as well.
+ As China's CRRC becomes more dominant [inaudible] should
+the United States rely on a Chinese state-owned enterprise for
+the production of our countries freight and passenger rail
+cars, the position of RSA is a resounding, no. The strategic
+targeting of our Nation's infrastructure by the government of
+China and its state-owned enterprises poses a fundamental
+threat to the fabric of our critical infrastructure and is a
+pressure point for malicious cyber actors to threaten not only
+the economic and National security of the United States but our
+standing as a global power.
+ Thank you again for the opportunity to testify. I look
+forward to answering any questions you may have.
+ [The prepared statement of Mr. Olson follows:]
+ Prepared Statement of Erik Robert Olson
+ February 26, 2019
+ introduction
+ Chairman Correa, Chairman Richmond, Ranking Member Lesko, Ranking
+Member Katko, and Members of the subcommittees, my name is Erik Olson
+and I am the vice president of the Rail Security Alliance. The Rail
+Security Alliance is a coalition of North American freight rail car
+manufacturers, suppliers, unions, and steel interests committed to
+ensuring the economic and National security of our passenger and
+freight rail systems. On behalf of our coalition, thank you for the
+opportunity to testify on the critical topic of securing our surface
+transportation systems against cyber and privacy threats.
+ Rail in the United States is an integral component of our critical
+infrastructure and our way of life. With nearly 140,000 miles of
+railroad covering the United States, freight rail regularly transports
+key commodities, sensitive U.S. military equipment, hazardous waste,
+potentially toxic and hazardous chemicals, and flammable liquids across
+the country every day. On the passenger side, millions of Americans
+rely on commuter rail systems every day. The U.S. rail system is also
+highly sophisticated, relying on a constantly expanding network of
+technology and digitization that dramatically increases its risk to
+cyber attack and hacking.
+ Today, I want to draw the committee's attention to a particular
+threat arising from foreign investment in this industry that
+jeopardizes the future of America's passenger and freight rail systems.
+China is strategically targeting the U.S. rail manufacturing sector,
+with aggressive, strategic, and anticompetitive actions. Thus far they
+have secured four U.S. metropolitan transit contracts, largely by
+utilizing anticompetitive under-bidding practices. With China's
+government picking up U.S. transit rail manufacturing contracts, the
+Chinese are now using their rail manufacturing capabilities to assail
+the U.S. freight manufacturing sector in a move that is reminiscent of
+what has already occurred in third-country markets such as Australia.
+This activity is a pattern for China's state-owned rail sector and
+raises grave National security concerns. Without action, America's
+industrial, military, and other Government interests could be forced to
+rely significantly or wholly on rail cars made by the Chinese
+government, thus creating massive cyber vulnerabilities that threaten
+our military and industrial security.
+ china's state-owned enterprises target u.s. rail manufacturing
+ The ``Made in China 2025'' initiative, a key component of China's
+13th Five-Year plan,\1\ identifies the rail manufacturing sector as a
+top target for Chinese expansion. This initiative has systematically
+and deliberately driven strategic investment and financing activities
+of the state-owned China Railway Rolling Stock Corporation (CRRC) in
+third-country markets and the United States. CRRC is wholly owned by
+the government of China and it has 90 percent of China's domestic
+market for production of rail locomotives, bullet trains, passenger
+trains, and metro vehicles.\2\ In 2015, CRRC reported revenues of more
+than $37 billion \3\--significantly outpacing the entire U.S. rail car
+market, which had $22 billion of output during the same year.\4\
+According to Chinese state media, CRRC plans to increase overseas sales
+to $15 billion by next year alone. This represents about double the
+level of export orders from just 4 years ago \5\ and according to
+CRRC's own presentation materials the U.S. market remains a prime
+target to, as they put it, ``conquer.''\6\
+---------------------------------------------------------------------------
+ \1\ U.S.-China Economic and Security Review Commission, 2016 Report
+to Congress, November 2016, at 100.
+ \2\ Langi Chiang, China's largest train maker CRRC Corp announces
+12.2 billion yuan in contracts, South China Morning Report, July 23,
+2015. https://www.scmp.com/business/companies/article/1842983/chinas-
+largest-train-maker-crrc-corp-announces-122-billion-yuan.
+ \3\ CRRC Corporation, 2015 CRRC Annual Report, https://
+www.crrcgc.cc/Portals/73/Uploads/Files/2016/8-23/
+636075436968234671.pdf.
+ \4\ Oxford Economics, Will We Derail US Freight Rolling Stock
+Production?, May 2017, at 24.
+ \5\ Brenda Goh, China Trainmaker CRRC to build more plants abroad
+in expansion plan: China Daily, REUTERS, Dec. 5, 2016, http://
+www.reuters.com/article/us-crrc-expansion-idUSKBN13U0EJ.
+ \6\ @CRRC_global, ``Following CRRC's entry to Jamaica, our products
+are now offered to 104 countries and regions. So far, 83 percent of all
+rail products in the world are operated by #CRRC or are CRRC ones. How
+long will it take for us conquering the remaining 17 percent?''
+Twitter, January 11, 2018. https://twitter.com/CRRC_global/status/
+951476296860819456.
+---------------------------------------------------------------------------
+ Using State-backed financing, subsidies, and an array of other
+government resources, CRRC has strategically targeted and sought to
+capture the U.S. railcar manufacturing sector. In just the last 5 years
+the United States has witnessed CRRC establish rail assembly operations
+for transit railcars in 3 States, along with additional research and
+bidding operations in several others. By beginning with a business
+strategy to take market share in the U.S. transit rail manufacturing
+sector and deploying near-limitless financing from its home government
+to help lower the well-below-market bids for new U.S. metropolitan
+transit projects, CRRC has quickly established itself as a formidable
+force in U.S. transit rail competition.
+ Several recent cases involving CRRC bids for new transit rail
+projects serve as compelling examples of the strategy being employed by
+China to capture our rail systems:
+ CRRC bid $567 million to win a contract with the
+ Massachusetts Bay Transit Authority (MBTA) in Boston in 2014,
+ coming in roughly 50 percent below other bidders.\7\
+---------------------------------------------------------------------------
+ \7\ Bonnie Cao, After Winning MBTA Contract, China Trainmaker CRRC
+Plans American Expansion, Boston Globe, Sept. 11, 2015. https://
+www.bostonglobe.com/business/2015/09/11/after-winning-mbta-contract-
+china-trainmaker-crrc-plans-american-expansion/jnS1kU7uHWF-
+GR9gjWmDEjM/story.html.
+---------------------------------------------------------------------------
+ In 2016, CRRC won a contract to provide transit rail for the
+ Chicago Transit Authority (CTA), bidding $226 million less than
+ the next-highest bidder.\8\
+---------------------------------------------------------------------------
+ \8\ Corilyn Shropshire, First Step to New CTA Rail Cars: Build the
+Factory in Chicago, Chicago Tribune, Mar. 16, 2017. http://
+www.chicagotribune.com/business/ct-cta-new-railcar-plant-0316-biz-
+20170315-story.html.
+---------------------------------------------------------------------------
+ In early 2017, CRRC bid $137.5 million for a contract with
+ Southeastern Pennsylvania Transportation Authority (SEPTA) in
+ Philadelphia, underbidding the next-lowest bidder--which had a
+ robust local manufacturing presence--by $34 million.\9\
+---------------------------------------------------------------------------
+ \9\ Jason Laughlin, Mass.-Based Company with Chinese Backing Beats
+Local Group for SEPTA Car Contract, The Philadelphia Inquirer, Mar. 21,
+2017. http://www.philly.com/philly/business/transportation/Mass-based-
+company-with-Chinese-backing-beats-out-local-group-for-SEP- TA-car-
+contract.html.
+---------------------------------------------------------------------------
+ In March 2017, CRRC finalized a contract with the Los
+ Angeles County Metropolitan Transportation Authority for its
+ transit rail system worth up to $647 million.\10\ Again, China
+ did this by leveraging below-market financing, which in turn
+ undercut other bidders.
+---------------------------------------------------------------------------
+ \10\ Keith Barrow, Los Angeles Orders CRRC Metro Cars,
+International Railway Journal, Mar. 24, 2017. http://
+www.railjournal.com/index.php/north-america/los-angeles-orders-crrc-
+metro-cars.html.
+---------------------------------------------------------------------------
+ Emboldened with these contract wins, CRRC continues to target other
+U.S. cities, including our Nation's capital. In September, the
+Washington Metropolitan Transit Authority (WMATA), which is the second-
+largest mass transit system in the country, issued a Request for
+Proposals (RFP) for the new 8000-series metro car. This RFP includes
+video surveillance, monitoring and diagnostics, data interface with
+WMATA, and automatic train control systems that are susceptible to
+cyber attacks. In response to concerns expressed by a number of
+lawmakers, including the Vice Chairman of the Senate Intelligence
+Committee, WMATA re-issued its RFP to include additional cybersecurity
+protections.\11\
+---------------------------------------------------------------------------
+ \11\ Sean Lyngaas, D.C. Metro system beefs up supply chain
+cybersecurity provisions for new rail cars, Cyberscoop, February 6,
+2019. https://www.cyberscoop.com/metro-dc-subway-cyberscecurity-rfp/.
+---------------------------------------------------------------------------
+ But the Rail Security Alliance's concerns do not end there.
+Whomever is selected to supply rail cars for WMATA will become a
+partner in the day-to-day operations of a Metro system whose stops
+include the Pentagon and the Capitol, as well as unfettered access to
+our Nation's tunnels and underground infrastructure.
+ We couple this reality with two additional critical facts. First, a
+Classified report written by WMATA's inspector general recently
+concluded that there were significant shortcomings in WMATA's
+enterprise-level cybersecurity posture.\12\ Second, just last week the
+New York Times noted that ``businesses and government agencies in the
+United States have been targeted in aggressive attacks by . . . Chinese
+hackers . . . ''.\13\ So, in light of China's pervasive history of
+cyber espionage and hacking, it is the position of the Rail Security
+Alliance that we cannot trust a Chinese state-owned enterprise to
+build, own, or operate in U.S. critical infrastructure.
+---------------------------------------------------------------------------
+ \12\ Ryan Johnston, D.C. Metro needs to improve its cybersecurity,
+audit finds, Statescoop, July 9, 2018. https://statescoop.com/wmata-
+incident-response-audit-calls-for-improved-cybersecurity-plan/.
+ \13\ Nicole Perlroth, Chinese and Iranian Hackers Renew Their
+Attacks on U.S. Companies, New York Times, February 18, 2019. https://
+www.nytimes.com/2019/02/18/technology/hackers-chinese-iran-usa.html.
+---------------------------------------------------------------------------
+ These developments are even more alarming because they provide CRRC
+the opportunity to pivot into freight rail assembly, a subsector of
+rail not protected by the same Buy America requirements as transit
+rail, and one that represents a troubling vulnerability if overtaken by
+the government of China. Even so, CRRC is making steady and deliberate
+headway into this sector with the launch of Vertex Rail Corporation and
+American Railcar Services. Vertex Rail Corporation is now, a defunct
+freight rail assembly facility that was based in Wilmington, North
+Carolina. On the other hand, American Railcar Services is a separate
+assembly facility headquartered in Miami, FL that maintains assembly
+operations in Moncton, New Brunswick.
+ Concerns about CRRC's transition into freight rail manufacturing
+are best illustrated by the recent experiences of third-country markets
+like Australia, whose freight rail manufacturing sector CRRC entered in
+2008. In less than 10 years, CRRC effectively decimated the sector,
+forcing the 4 domestic suppliers out of business and out of the rail
+market which left only CRRC standing. Today, almost no meaningful
+Australian passenger or freight rolling stock manufacturing exists--
+CRRC's Australia footprint is almost exclusively that of an assembler
+of Chinese-made parts and a financier of purchases from CRRC. We cannot
+let that happen here.
+
+
+[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
+
+ implications for national security
+ Unlike the U.S. maritime shipping industry, whose security is
+protected by the Jones Act, a measure that requires vessels
+transporting goods between U.S. ports to be U.S.-built and majority
+U.S.-owned, freight rail in America has been left comparatively
+unprotected. Yet, the Department of Homeland Security (DHS) deems the
+U.S. rail sector as part of the Nation's critical infrastructure,\14\
+noting that 140,000 rail miles enable U.S. freight rail to run through
+every major American city and every military base in the Nation. The
+Department of Defense (DoD), which itself maintains a fleet of more
+than 1,300 rail cars, has also designated nearly 40,000 miles of
+freight rail as part of the Strategic Rail Corridor Network (STRACNET),
+a comprehensive rail network that connects military bases and maritime
+ports across the country.\15\ We have had extensive discussions with
+representatives from the Department of Defense, and based on those
+discussions I am confident that the Secretary of Defense would express
+his concerns on this matter as well.
+---------------------------------------------------------------------------
+ \14\ Presidential Policy Directive 21 (PPD-21) identifies 16
+critical infrastructure sectors, including ``Transportation Systems.''
+The Department of Homeland Security defines ``Freight Rail'' as 1 of
+the 7 key subsectors. See generally, PPD-21, Critical Infrastructure
+Security and Resilience, Feb. 12, 2013, https://www.whitehouse.gov/the-
+press-office/2013/02/12/Presidential-policy-directive-critical-
+infrastructure-security-and-resil and Transportation Systems Sector,
+Dep't of Homeland Sec., Mar. 25, 2013, http://www.dhs.gov/
+transportation-systems-sector.
+ \15\ ``Strategic Rail Corridor Network (STRACNET),'' Global
+Security, 2012. https://www.globalsecurity.org/military/facility/
+stracnet.htm.
+---------------------------------------------------------------------------
+ Because freight rail transports not only military freight and
+industrial products, but also nuclear material and hazardous chemicals
+that can be safely and effectively transported only by rail, there is a
+serious risk that the technologies in these systems could be
+compromised by a malicious actor. As noted by Brig. Gen. John Adams
+(USA, Ret.) in a 2018 report on the vulnerabilities of freight
+rail,\16\ our rail system's rapidly expanding internet of things (IoT)
+capabilities presents an array of National security challenges that
+include:
+---------------------------------------------------------------------------
+ \16\ National Security Vulnerabilities of the U.S. Freight Rail
+Infrastructure and Manufacturing Sector--Threats and Mitigation,
+Brigadier General John Adams, US Army (Retired), October 22, 2018.
+---------------------------------------------------------------------------
+ A digitized railroad network/the internet of things.--
+ Integrated teams of data scientists, software developers, and
+ engineers develop and apply technology across every aspect of
+ the Nation-wide freight rail network, effectively increasing
+ the vulnerability of industrial control systems, train
+ operations, and perhaps even the industry's metadata
+ warehousing centers to cyber threats.
+ Rail Signaling.--Congress has mandated the installation of
+ positive train control (PTC) systems on much of the Nation's
+ rail systems as a means of preventing specific accidents. A
+ malicious cyber breach of PTC or underlying existing rail
+ signaling systems could wreak havoc and cause accidents or
+ derailments on the highly interdependent freight railway
+ network.
+ Locomotives.--Rail locomotives rely upon hundreds of sensors
+ to monitor asset health and performance of train systems.
+ On-board Freight Car Location & Asset Health Monitoring.--
+ Thousands of freight cars are equipped with telematics or
+ remote monitoring equipment, many of which are carrying
+ hazardous materials like chlorine, anhydrous ammonia, ethylene
+ oxide, and flammable liquids. This tracking technology includes
+ a wireless communication management unit to track precise near-
+ real-time location via GPS, direction of travel, speed, and
+ dwell time within the Transportation Security Administration
+ (TSA)'s 45 designated high-threat urban areas (HTUAs).\17\
+---------------------------------------------------------------------------
+ \17\ The Transportation Security Administration defines an HTUA as
+an area comprising one or more cities and the surrounding areas,
+including a 10-mile buffer zone.
+---------------------------------------------------------------------------
+ End-of-Train Telemetry (EOT).--The FRA requires all freight trains
+operating on excess of 30 mph to be equipped with a 2-way EOT device
+that tracks GPS location and can allow a locomotive engineer to
+initiate an emergency brake application, a critical safety feature for
+trains that can stretch upwards of 10,000 feet long (See Attachment A).
+ The presence of these evolving technologies underscores the clear
+danger of a foreign country, and particularly the government of China
+and its state-owned enterprises, having undue control of freight
+manufacturing in the U.S. market. Already, there are reports of Chinese
+manufacturers investigating the production of their own ``telematics''
+technology to allow the monitoring and control of their rail cars.\18\
+On the transit side, China is already boasting about how it has
+utilized the latest advances in AI and facial recognition technology to
+identify and track its 1.4 billion citizens,\19\ creating a very real
+prospect that they could do the same here in the United States.
+---------------------------------------------------------------------------
+ \18\ China plans ``smart trains'' to take on global rail companies,
+CHINA DAILY, March 10, 2016, http://english.chinamil.com.cn/news-
+channels/2016-03/10/content_6952271_2.htm.
+ \19\ Surveillance Cameras Made by China Are Hanging All Over the
+U.S., The Wall Street Journal, November 12, 2017. https://www.wsj.com/
+articles/surveillance-cameras-made-by-china-are-hanging-all-over-the-u-
+s-1510513949.
+---------------------------------------------------------------------------
+ conclusion
+ As China's CRRC becomes more dominant as a U.S. rail manufacturer,
+there are urgent and compelling questions we must answer regarding
+whether a growing presence of, and reliance upon freight or passenger
+cars from a major state-owned Chinese rail enterprise is likely to
+compromise the security and safety of industrial, military, and
+civilian transportation systems in the United States. For that reason,
+we are grateful that Congress passed legislation last year that would
+mandate the Department of Homeland Security, in coordination with the
+Committee on Foreign Investment in the United States and the Department
+of Transportation, produce a report on the National security threats of
+Chinese SOE investment in our rolling stock manufacturing sector,\20\
+and we strongly urge the committee to work with DHS as that report is
+completed.
+---------------------------------------------------------------------------
+ \20\ See. H.R. 5515--John S. McCain National Defense Authorization
+Act for Fiscal Year 2019, Sec. 1719(c).
+---------------------------------------------------------------------------
+ We greatly appreciate the committee's interest in addressing these
+critical issues. The strategic targeting of our Nation's infrastructure
+by the government of China and its state-owned enterprises poses a
+fundamental threat to the fabric of our critical infrastructure and is
+a pressure point for malicious cyber actors to threaten not only the
+economic and National security of the United States, but to our
+standing as a global power.
+ Thank you again for the opportunity to testify. I look forward to
+answering any questions you may have.*
+---------------------------------------------------------------------------
+ * Attachment A has been retained in committee files and is
+available at https://go.americanmanufacturing.org/page/-/
+Adams_Freight_Rail.pdf.
+
+ Mr. Correa. Thank you, for your statements.
+ I would like to recognize Mr. Hultquist, for 5 minutes.
+
+STATEMENT OF JOHN HULTQUIST, DIRECTOR OF INTELLIGENCE ANALYSIS,
+ FIRE EYE
+
+ Mr. Hultquist. Chairman Correa, and, Ranking Member Lesko,
+for convening this joint hearing today. My name is John
+Hultquist, and I am the director of intelligence analysis for
+FireEye. My team of over 150 intelligence analysts and
+researchers pore over data we collect from FireEye's global
+networks of devices, incident response, researchers monitoring
+the criminal underground and many more sources to understand
+the global cyber threat.
+ FireEye is supporting the transportation and energy sectors
+here at home. We are protecting TSA with email--thank you--and
+web inspection and we are providing support to DHS's
+subscription to our intelligence reporting.
+ At DOE we are supporting network and file inspection,
+malware analysis, and protecting their data from threats down
+at their endpoints. The Department is the largest civilian
+agency, consumer of our intelligence reporting which provides
+focused visibility into threats targeted at the energy sector.
+ Today I will focus primarily on threats on the horizon that
+FireEye is watching develop in the Middle East, Ukraine, South
+Korea, where Iran, Russia, North Korea, are the most active.
+ Despite a dearth of recent specific examples of pipeline
+targeting by state actors that we have observed, targeting the
+sector is consistent with the behavior of several state actors
+who have carried out disruptive and destructive operations.
+Pipelines sit at the nexus of two well-established interests
+for state actors, energy and transportation. For example, oil
+and gas has been the major focus of a long-term destructive
+malware campaign by Iran in the Gulf.
+ Though these attacks have targeted critical infrastructure
+organizations, they have primarily affected business-focused IT
+systems rather than sensitive controls systems. Nonetheless
+Iranian-sponsored threat actors have caused significant, costly
+disruptions from 2012 to as recently as 2018 using this
+capability.
+ The Middle East was also the scene of the most
+disconcerting attack on control systems we have observed. In an
+industrial plant, they have suffered a disruption when
+attackers inadvertently triggered a shutdown using a malware we
+call Triton. They triggered the shutdown because they were
+attempting to manipulate automated safety systems, one of the
+last lines of defense to protect human life. We believe this
+activity originated from a Russian government organization.
+ Transportation and logistics systems have been unrecognized
+but fruitful focus for state cyber attackers as well. During
+and between attacks on Ukraine's grid, attempts were made by
+the same Russian actors to gain access to rail, air, and sea
+transportation routes and hubs to varying degrees of success.
+ Many of the companies which posted major losses from the
+NotPetya Ransomware incident in the hundreds of millions of
+dollars were also in the logistics business, despite this
+industry not having been specifically targeted. Such a pattern
+could indicate that logistics organizations may be especially
+economically vulnerable to incidents of this nature.
+ Like pipeline operations, transit networks have been
+subjected to ransomware operations and denial-of-service
+attacks which have on occasions resulted in disruption to
+service. Ransomware which has affected many municipal services
+has been used to hold transit systems hostage in return for
+payment. The websites associated with mass transit systems
+which are often crucial to their business have also been
+subjected to denial-of-service attacks, in some cases
+disrupting travel. Both ransomware and denial-of-service are
+capabilities used by state actors.
+ The complexity of transit networks and the potential for
+cascading economic consequences from disruption, bear
+similarities to pipelines, however transit networks offer an
+additional attraction to would-be attackers. Transit is a
+highly-visible sector with which the public regularly
+interacts; this factor is especially relevant as many cyber
+attacks appear to be more focused on psychological effects and
+undermining confidence in institutions and creating lasting
+physical effects.
+ It is important to bear in mind that our adversaries are
+not necessarily preparing for a doomsday situation or any
+lasting blow but a asymmetric scenario where they can project
+power onto our shores. Ultimately their aim may be to sow chaos
+rather than to achieve some complex military objective.
+ Thank you, again for the opportunity to participate in
+today's discussion. I am happy to answer any of your questions.
+ [The prepared statement of Mr. Hultquest follows:]
+ Prepared Statement of John Hultquist
+ February 26, 2019
+ Thank you, Chairman Richmond, Ranking Member Katko, Chairman
+Correa, and Ranking Member Lesko for convening this joint hearing
+today. We appreciate the opportunity to share FireEye's perspective on
+threats to the transportation and energy sectors and provide an
+overview of how the private sector is helping to secure those sectors.
+ introduction
+ My name is John Hultquist, and I'm the director of intelligence
+analysis for FireEye. My team of over 150 intelligence analysts and
+researchers pore over data we collect from FireEye's global networks of
+devices, managed defense of 7 global Security Operations Centers, our
+incident response, researchers we have monitoring the criminal
+underground, and many more sources to understand the global cyber
+threat. We have teams focused on criminal threats, cyber espionage,
+cyber physical, and strategic problems, as well as vulnerabilities.
+Ultimately, we provide intelligence reporting and services used by
+Government and commercial clients around the world.
+ In addition to the 300-plus security professionals responding to
+computer intrusions, FireEye has over 200 cyber-threat analysts on
+staff in 18 countries, speaking 30 different languages, to help us
+predict threats and better understand the adversary--often by
+considering the political and cultural environment of the threat
+actors. We have an enormous catalog of threat intelligence, and it
+continues to grow everyday alongside the continually increasing attacks
+on organizations around the world.
+ FireEye is supporting the transportation and energy sectors here at
+home. We're protecting the Transportation Security Administration with
+both email and web inspection, managed by the Department of Homeland
+Security's Enterprise Security Operations Center. As TSA continues to
+stand up its intelligence capabilities, we are providing support
+through its subscription to our intelligence reporting.
+ Additionally, we assist in protecting the Department of Energy by
+supporting network and file inspection, malware analysis, and
+protecting their data from threats down to their endpoints. We provide
+the ability for deep forensics inspection of all network traffic
+managed by the Department's Enterprise Security Operations Center. As
+DOE continues to enhance its cyber capabilities, we provide visibility
+to meet the Data Taxonomy Metrics. The Department is the largest
+civilian agency consumer of our intelligence reporting, which provides
+focused visibility into the threats targeted at the energy sector.
+ In addition to my role at FireEye I'm an adjunct professor at
+Georgetown University and the founder of CYBERWARCON, a conference on
+the cyber attack and information operations threat.
+ I have been working in cyber intelligence for over a decade, most
+of it at FireEye, but before that I worked as a contract cyber
+intelligence analyst with the Defense Intelligence Agency and State
+Department. Prior to that I worked briefly at the Surface
+Transportation and Public Transit Information Sharing and Analysis
+Center where I was an analyst exploring threats to the sector we will
+be discussing today. Part of my duties there were to forecast domestic
+threats by exploring global incidents. Though much of this work was
+focused on counterterrorism, I believe the methodology I employed there
+is applicable to this problem. If we want to forecast threats to
+surface transportation, we have to look globally for the actors who may
+target this sector, and explore not just how they carry out attacks,
+but why.
+ Today I will talk about a few incidents that have already affected
+surface transportation, but I will focus primarily on threats on the
+horizon that FireEye is watching develop in the Middle East, Ukraine,
+and South Korea, where Iran, Russia, and North Korea are most active.
+My team has had some success with this method. In 2014, we exposed an
+actor, who we call Sandworm Team, which was carrying out cyber
+espionage in Ukraine and who was soon after exposed in U.S. critical
+infrastructure. A year later this actor caused the first known blackout
+by cyber attack in the Ukraine.
+ pipelines
+ Criminal, state, and hacktivist actors have all demonstrated an
+interest in pipeline operators. Pipeline operators have been the victim
+of criminal ransomware incidents on multiple occasions. Hacktivist
+actors have threatened pipelines for environmental and other political
+reasons. We have seen some specific interest in pipeline infrastructure
+from state actors as well. APT1, an actor tied to China's People's
+Liberation Army, carried out an intrusion campaign attempting to gain
+access to pipeline operators in 2012. While we do not think the
+campaign aimed to cause any immediate effects, at the time we did
+assess that it was reconnaissance of our infrastructure that could be
+leveraged over the long term.
+ Despite the dearth of additional specific examples of pipeline
+targeting, targeting the sector is consistent with the behavior of
+several state actors who have carried out disruptive and destructive
+operations. Pipelines sit at the nexus of two well-established
+interests for these state attackers: Energy and transportation. Despite
+a relatively brief history of disruptive and destructive cyber attacks
+against critical infrastructure, several incidents have focused on
+these sectors where the potential for cascading economic and
+psychological effects on the target population is considerable.
+ Energy, particularly oil and gas and the electrical power industry,
+has been the continued focus of threat actors who have either carried
+out disruptive cyber attacks or who appear to be tasked with preparing
+for such an operation. Destructive and disruptive attacks on oil and
+gas have almost become common in the Middle East where our U.S.
+adversaries are showcasing their capabilities and improving their
+skills.
+ For example, oil and gas has been the major focus of a long-term
+destructive campaign by Iran in the Gulf using destructive malware
+commonly referred to as ``Shamoon.'' Though these attacks have targeted
+critical infrastructure organizations, they have primarily affected
+business-focused IT systems rather than the sensitive control systems
+which run production. Nonetheless, Iranian-sponsored threat actors
+caused significant, costly disruptions from 2012 to as recently as
+December 2018, the last time we observed one of these incidents.
+ The Middle East was also the scene of the most disconcerting attack
+on control systems we have observed. An industrial plant there suffered
+a disruption when attackers inadvertently triggered a shutdown using
+malware we call TRITON. They triggered that shutdown because they were
+attempting to manipulate automated safety systems, one of the last
+lines of defense to protect human life. We believe the attackers were
+developing the ability to create an unsafe condition using the control
+systems, while simultaneously disabling the safety systems designed to
+mitigate the attack. Such a scenario could have led to major disruption
+of operations, economic loss, and even loss of life. We believe this
+activity originated from a Russian government organization called the
+Central Scientific Research Institute of Chemistry and Mechanics. It is
+unknown whether these actors had been tasked to target the plant for
+some specific geopolitical goal or if they were using this Middle
+Eastern facility as a testbed to improve their capability.
+ In principal, methodologies honed in the Middle East against oil
+and gas could be applied to our pipeline sector. Destructive attacks
+could be used to interrupt the administration of these complex systems,
+potentially causing economic repercussions that cascade through the
+myriad of downstream users who depend on reliable service. A more
+complex scenario, like the TRITON incident, could also target
+pipelines, which could be manipulated to potentially disastrous
+consequences if actors can gain access to control and safety systems.
+ Transportation and logistics systems have been an underrecognized
+but fruitful focus for state cyber attackers as well. During and
+between well-known attacks in Ukraine which turned off the power to
+portions of the country, attempts were made by the same Russian actors
+to gain access to rail, air, and sea transportation routes and hubs, to
+varying degrees of success. In fact, we saw evidence indicating that
+while they were prepping the first attack that briefly disabled power
+service in the Ukraine, the actors we call Sandworm Team were also
+compromising airport and rail services. There are plausible but
+unverified reports of an attack which lead to disruption of rail
+service coincided with the second attack on Ukraine's grid.
+ As in the case of the Middle East, in Ukraine, we see technically
+complex cyber attacks that strike at the most sensitive industrial
+control systems, such as those that caused blackouts, as well as
+attacks that are not focused on these systems at all. Both types of
+attack have been successful. While grid attacks were undoubtedly
+watershed events, the most economically damaging attack we have ever
+encountered was fake ransomware called NotPetya. This fake ransomware-
+encrypted drives just like its real criminal counterpart, but the state
+actors behind it never intended to decrypt this information for any
+amount of money, essentially making it a destructive tool. The malware
+spread rapidly, locking up vital systems and causing major disruptions
+to global companies. The result was over 10 billion dollars in damages,
+according to one White House estimate. Most notably, however, many of
+the companies which posted major losses in the hundreds of millions
+were in the logistics business, despite this industry not having been
+specifically targeted. Such a pattern could indicate that logistics
+organizations may be especially economically vulnerable to cyber
+attacks of this nature.
+ transit
+ Like pipeline operations, transit networks have been subjected to
+ransomware operations and denial-of-service attacks, which have, on
+occasion, resulted in disruption to service. Ransomware, which has
+affected many municipal services, has been used to hold transit systems
+hostage in return for payment. An attack like this in San Francisco
+took tickets systems off-line, but operations continued when riders
+were offered free passage. In most cases we believe the attackers were
+financially motivated, though it is worth noting that these incidents
+expose a vulnerability that state actors, who have used a fake
+ransomware capability, could exploit.
+ In addition to ransomware incidents, the websites associated with
+mass transit systems, which are often crucial to their business, have
+been subjected to denial-of-service attacks. These incidents, which
+involve the use of a network of hijacked computers to jam a website
+with bogus traffic, have in some cases frozen operations. We have seen
+this phenomenon as far afield as Ukraine and Sweden. In 2017, transit
+systems in Sweden came under a prolonged attack by an unknown actor who
+disrupted travel. It is worth noting that like ransomware, denial of
+service is a capability used by state actors. And just as ransomware
+allows these actors to carry out attacks while hiding their true
+intentions, state actors have purported to be hacktivists and taken
+credit for denial-of-service attacks, hiding their hand it the
+operations. This was the case in the United States, where Iranian
+hackers attacking our financial system claimed to be a pan-Arab
+hacktivist. Furthermore, there is a reduced barrier to entry for these
+types of attacks, and even states without this capability could source
+it from the criminal underground.
+ The complexity of transit networks and the potential for cascading
+economic consequences from disruption bear similarities to pipelines;
+however, transit networks offer an additional attraction to would-be
+attackers--transit is a highly-visible sector with which the public
+regularly interacts. This factor is especially relevant as many cyber
+attacks appear to be more focused on psychological effects and
+undermining confidence in institutions than creating lasting physical
+effects.
+ One example of a highly-visible cyber attack which affected the
+populace is the destructive campaign against South Korean media and
+banking in 2013. Though this campaign failed to interrupt broadcasts,
+it did interrupt some banking services, including on-line banking and
+ATMs. The result was a visible crisis that affected the everyday lives
+of South Koreans and which might have been even greater if broadcasts
+were halted. Blackouts fall into this same category of having far-
+reaching psychological effects. A disruption to transit could have a
+similar effect.
+ conclusion
+ Thus far, U.S. critical infrastructure has been probed by actors
+from China, Russia, Iran, and North Korea. In many cases, these actors
+have focused heavily on electricity generation; however, our experience
+with them abroad suggests a much broader interest in creating
+disruptive or destructive effects. We should take these lessons to
+heart now and prepare for incidents across the transportation sector.
+ It's important to bear in mind that our adversaries are not
+necessarily preparing for a doomsday situation, or any lasting blow,
+but an asymmetric scenario where they can project power within our
+shores. Ultimately, their aim may be to sow chaos rather than achieve
+some complex military objective. Nonetheless, these incidents could
+have economic and psychological effects we cannot ignore.
+ Thank you again for the opportunity to participate in today's
+discussion. And thank you for your leadership improving cybersecurity
+in the transportation and energy sectors. I look forward to working
+with you to strengthen the partnership between the public and private
+sectors and to share best practices to thwart future cyber attacks.
+
+ Mr. Correa. I thank our panelists for their testimony.
+ If I may, I would like to recognize myself for 5 minutes of
+questions. I will start out with, Mr. Lewis, you made a comment
+at the end of your statement about credible threat, we need to
+be a credible threat, can you explain that a little bit?
+ Mr. Lewis. Certainly. Thank you, Mr. Chairman.
+ When we look at the behavior of Russia, China, Iran and to
+some extent North Korea, they are the most dangerous attackers
+but they are also very calculating, they are very rational and
+they ask themselves, ``If I do this to the Americans, what is
+the likelihood that the Americans will do something back?'' and
+if they believe there is no risk that we will do anything back,
+they are more likely to undertake some sort of hostile or
+coercive action.
+ Mr. Correa. In this committee last year, the full Committee
+on Homeland Security, I asked the question, at what point does
+a cyber attack constitute a declaration of war on the United
+States? Any thoughts?
+ Mr. Lewis. This is [inaudible] was an attack that caused
+death or destruction or casualties, it would qualify as
+justifying a forceful response. Unfortunately, we haven't seen
+very many of them and if you look at what the Russians did in
+2016, it wouldn't fall under that category so this is something
+that I believe the intelligence community and cyber command are
+working through. We need a new framework, if you cause death or
+destruction, you fear a risk, that you fear that the United
+States will retaliate. If you don't do that, people kind-of
+feel like they can get away with it.
+ Mr. Correa. If you threaten our democracy or destabilize
+our Government, is that an act of war and I would ask that
+question to all of you?
+ Mr. Lewis. Under the current legal construct, the answer
+would be no, right. You could make a case that by threatening
+the political integrity of the United States, it would qualify
+as an act of war but our main problem is that we became aware
+this was happening in April 2016, that is almost 3 years ago
+and we still have not done very much back.
+ Mr. Correa. Mr. Olson, you talked a little bit about the
+challenge of Chinese assets, Chinese buying essentially their
+way into our markets, they are buying their markets and you
+talk about a threat, could you relate that back to the China's
+new 27 intelligence law that compels companies, Chinese
+companies to cooperate with the Chinese government?
+ Mr. Olson. Sure. So I am not fully familiar with the law
+itself, I mean, I have read articles about it. I mean, our
+concern is that this is a wholly-owned, state-owned enterprise
+that has a board of directors with members of the Communist
+Party and we know that when they set up shop here in United
+States that we believe they are been directed by Beijing and
+the cyber issues, privacy issues, and just the economic
+security that stems from that is our main concern from RSA's
+point of view.
+ Mr. Correa. Same question, to Mr. Hultquist.
+ Mr. Hultquist. Right, I am not familiar with that exact
+regulation but it is not uncommon for Russia or China to
+enforce or compel companies to work with their cybersecurity or
+their Signals Intelligence agencies to gather information.
+ Mr. Correa. Thank you very much.
+ I am going to yield the remainder of my time.
+ I will now recognize the gentle person from Arizona, Mrs.
+Lesko.
+ Mrs. Lesko. Thank you, Mr. Chairman.
+ My first question is for, Mr. Hultquist, hello sir. I have
+a couple of questions into one. Basically, how well do you
+think the industry uses ISAC, the information you know, where
+you share information with the industry [inaudible] and my
+secondary question is, what are the risks from insider threats?
+ Mr. Hultquist. I had actually previously worked at a couple
+of the ISACs, actually the Surface Transportation and Public
+Transit ISAC, I worked there briefly before moving into the
+cyber world. They have made a lot of great strides in the cyber
+space and several of them I think on are very, very mature and
+are making a big difference.
+ On one of the problems though is that we sometimes take
+this myopic view of our sector and we have failed to see
+threats coming because we are overly focused on just our own
+sector and it is important to look at our own sector but the
+actor who turned off the lights in Ukraine, was also targeting
+air, and rail, and all these other sectors, not because the
+lights were you know, particularly [inaudible] sometimes if we
+you know, we focus too much that way, we can kind-of miss that.
+ I am sorry, your second question.
+ Mrs. Lesko. Was, what is the risk of insider threats, like
+people that are working for, let us say, the rail system or
+passenger rail?
+ Mr. Hultquist. Many of the----
+ Mrs. Lesko. Or pipelines?
+ Mr. Hultquist. Major critical infrastructure incidents that
+we have seen throughout history have involved an insider
+component, a contractor who didn't get hired on was upset about
+their situation and decided to lock things up or I believe
+there was a situation where they pumped toxic stuff into a
+[inaudible] critical infrastructure.
+ Mrs. Lesko. What can be done about it, do you think?
+ Mr. Hultquist. Probably a more complex or a more robust
+vetting process and recognition that when people move in and
+out of an organization, security measures need to be sort-of
+re-looked at particularly do they still have access, things of
+that nature.
+ Mrs. Lesko. Thank you, sir.
+ My next question is for the gentleman with the rail system
+and you had mentioned--I read this article that I think it was
+in The Washington Post, entitled, ``Could a Chinese-made Metro
+Car, spy on us?'' I think you were quoted in this and some of
+the transit authorities in this article, the Chicago Transit
+Authority, the Massachusetts Bay Transportation Authority, they
+basically said that none of the critical software components
+were being produced in China.
+ What are your thoughts on that, are they misspoken or you
+know, they said that they are considering bids from CRRC but
+that the critical software components are not made in China and
+in fact one of the Massachusetts Bay Transportation Authority
+spokesman said, ``The design process for new rail cars includes
+a cybersecurity analysis based on the U.S. Department of
+Defense Military System Safety Standard,'' so I am glad that we
+are bringing this up because I think it is a legitimate concern
+but it seems like at least from these people, spokesman, that
+the critical infrastructure is not made in China.
+ Can you comment?
+ Mr. Hultquist. Yes. What I would say to that is that our
+concern is you can try to mitigate and the we heard from Ms.
+Proctor, earlier that the cyber concerns are ever-evolving. I
+don't know all the parts or the list of the parts but many
+parts are being made in China, the shells for Los Angeles and
+for Boston are being made in China and shipped to Springfield,
+Massachusetts so our position at RSA's risk avoidance.
+ We don't know what can be put into a shell. We don't know
+what technology can be hid in there. The Chinese have a long
+view [inaudible] attack but we also think of it from a point of
+privacy. When you have access to the tunnel [inaudible] the
+CCTV, can you get access to the Wi-Fi system? We know how they
+profile their own citizens and it does not take a lot to lead
+to the fact that maybe you could do that here especially in the
+Metro region.
+ Mrs. Lesko. Thank you, sir.
+ I yield back my time.
+ Mr. Correa. Thank you, Mrs. Lesko.
+ I recognize the gentleman from Louisiana, Chairperson
+Richmond.
+ Mr. Richmond. Thank you, Mr. Chairman.
+ This will be for Ms. Gagliostro and Mr. Olson. It is
+basically describing your relationship with TSA-DHS as a whole
+but TSA and CISA. Has there been rail stakeholder involvement
+in the implementation and the goals outlined in the Pipeline
+Cybersecurity Initiative and, Mr. Olson, in your view, are DHS
+and TSA being proactive enough in sharing information about
+cyber threats and best practices within rail systems, and to
+both of you all, what could they be doing differently or more?
+ Ms. Gagliostro. So I would say that yes, there has been
+rail stakeholder involvement beyond the efforts of the Pipeline
+Cybersecurity Initiative because as you know, that Initiative
+was only announced in October but prior to that TSA has been
+working to build its security program for over a decade now,
+has a very strong working relationship with industry. We
+regularly engage in Pipeline Sector stakeholder calls to share
+information about threat indicators that they are getting and
+also information about the tools that they are providing to
+industry to help us with their security programs.
+ I think that the work that TSA is doing right now to have
+more coordination with DHS and the CISA Office, and the
+National Risk Management Center is a very positive step in the
+right direction of looking more comprehensively across these
+nation-state threats in particular that are targeting all
+critical infrastructure to make sure that we are empowering
+industry to learn from how these threats are looking
+[inaudible].
+ Mr. Olson. To echo I agree that from my understanding, I
+mean, the folks at the Rail Security Alliance represents our
+private industry and we know they have been talking, TSA has
+their private briefings we heard that from, Ms. Proctor,
+earlier that they have been doing Classified briefings for
+members both in the Passenger Rail Sector and also the Freight
+Rail Sector. I think there can always be more and more
+involvement, we have certainly reached out to them to have
+conversations as well on this point.
+ What I would say on the what could be done, what could they
+be doing more is DHS actually has a study sitting at Homeland
+Security right now that they need to complete by the end of the
+fiscal year, we would love to work with you all and work with
+the Department of Homeland Security on this study and ensure
+that private sectors' voice is heard as they are completing
+this risk assessment of what state-owned enterprises, how they
+could affect the U.S. transit and freight rail market.
+ Mr. Richmond. Thank you for your time.
+ Mr. Chairman, I do have prior commitments so I will yield
+the balance of my time through the gentleman from Missouri, Mr.
+Cleaver.
+ Mr. Correa. Thank you, Chairman Richmond.
+ Mr. Cleaver, go ahead.
+ Mr. Cleaver. Thank you, Mr. Chairman.
+ I was mayor of Kansas City all during the 1990's up until
+2000 and I can remember one of the most frightening periods of
+my term as mayor came when we received word, we were not
+notified but we received word, there was very likely going to
+be a shipment of [inaudible] and taken to the Nevada, Yucca
+Mountain and there was a lot of resentment [inaudible] the
+largest freight-rail site in the country and St. Louis 200
+miles away is No. 3.
+ We are a [inaudible] have been extremely concerned over the
+years about the transportation of waste but also how vulnerable
+we are and particularly in the Midwest because you know, no
+matter what the discussion is, it's probably even freight, we
+tend to focus on East Coast, West Coast, maybe a little part of
+the North Coast and the Midwest is wide open.
+ I always like to remind people that the first major
+terrorist attack in this country occurred right in the middle--
+Midwest at Oklahoma City at the Murrah Federal Building. It has
+nothing to do with rail but the point I am raising, Mr. Lewis,
+and, Mr. Olson, is that I am not sure that there is any
+appropriate attention being given to that part of the country
+where a lot of the rail is centered.
+ Mr. Olson. I tend to agree with you, Congressman. I know
+that you know, the Class Is, the freight rail manufacturers are
+all working on these issues and working on the cyber aspects of
+this and the security aspects of this. RSA's position and has
+been as our concern is allowing the Chinese to come in and make
+freight railcars----
+ Mr. Cleaver. Yes, sir.
+ Mr. Olson [continuing]. And be a part of the system and the
+security challenges come with that. As you know, freight rail
+carries grain, from toxic waste, to military equipment, and our
+view is from RSA, as soon as you allow the Chinese into the
+system and they are building cars they are able to track where
+all these things are going and get a birds-eye view on where we
+are moving commodities, we are moving helicopters, where we are
+moving people and that is of grave concern for us from a
+National security perspective and we share your concerns sir.
+ Mr. Cleaver. Mr. Lewis.
+ Mr. Lewis. Thank you, Congressman. You know, I think
+there's two questions you always want to ask, does the device
+connect back home and there is a surprising answer to that
+increasingly as we connect things to the internet. I was
+reading yesterday about a smart doorbell that was inadvertently
+relaying peoples' voices back to China so rail cars are a good
+target, rail lines are a good target, they're traditional
+military targets, good target for disruption.
+ The other thing you would want to ask though is when is it
+in the opponents' interest to do so and in that sense, they are
+looking at it from a National perspective. They are looking at
+from where the least-defended parts of the country, where can
+they achieve the most effect so in that way may be the Midwest
+is a good target.
+ Mr. Cleaver. Yes. I would argue that there is some evidence
+to suggest that it is a target and of course my question, Mr.
+Chairman, is you know, when are we going to give the necessary
+attention? I mean, you know, when I am asked you know, the
+question, I am no longer in the mayor's office but the people
+wants to know, Homeland Security, so when are they going to
+give us the attention that they have been giving New York and
+Boston and San Francisco and Los Angeles and I guess I should
+say, it is still up in the air, until something happens. Is
+that [inaudible].
+ Mr. Lewis. Attention has gone to the largest metropolitan
+areas and so you are really the top 12 SMSA, Standard
+Metropolitan Statistical Areas and so the question is, can we
+expand that? It is a question of cost and also of personnel as
+we have heard so that tends to mean that if you are not in the
+top 12, the top 20, you might not be getting the same attention
+as others.
+ Mr. Correa. Thank you, Mr. Cleaver. Thank you very much and
+I would like to recognize the gentle person from New York, Miss
+Rice.
+ Miss Rice. So, Mr. Lewis, just to continue on that so you
+had said at the beginning right at the end of your original
+statement, you talked about the cost factor. Can you just
+expound on that a little bit more?
+ Mr. Lewis. Certainly. Thank you. We have heard from the
+other witnesses too that in many cases Chinese companies are
+subsidizing--it is part of a larger very aggressive
+mercantilist policy that the Chinese follow and so that allows
+them to offer products at a lower price and the information we
+saw in Australia and them squashing the competition there, you
+can find that in other industries so you have a subsidized
+price with pretty good equipment----
+ Miss Rice. Right.
+ Mr. Lewis. Some unknown risk for surveillance or disruption
+and the buyers have to make a decision, do I pay more for
+security or do I go with the lower cost and------
+ Miss Rice. So why is the Federal Government allowing them
+to make that decision at their level, regardless of whether the
+money that they are using is State money or Federal money. I
+mean, I would assume if it is Federal money then we have
+absolute say over their decision-making process but is it that
+difference--about what pocket of money they are taking it from?
+ Mr. Lewis. We--thank you. We have not come to terms until
+recently with the fact that there's a risk in buying from China
+so our supply chains are deeply integrated and so you know,
+when you go to the store and you turn--very often it will say,
+Made in China. Up until a few years ago people thought, oh
+well, you know, they are going to become a market--this is
+fine, so we have--we are just starting to think about how we
+disentangle that. Part of it might be asking about what
+technologies are sensitive, where's there additional risk?
+ You have all seen all the news on Huawei in the papers and
+this is a [inaudible].
+ Miss Rice. What are we waiting for in this field?
+ Mr. Olson. I would just add, I mean, Congress did examine
+this issue last year when it came to Federal Transit Authority
+dollars, there was actually a 1-year ban put in place in the
+Senate THUD bill. It was unfortunately stripped out of the
+final version that you know, you guys passed on February 15
+because it was deemed controversial because there are certain
+members that have state-owned enterprise Chinese facilities in
+their district and so they are trying to preserve jobs back
+home.
+ I will also note--yes, you are right when it comes to the
+bucket of dollars there are some of these local governments
+because of the deep discounts that the Chinese are giving, the
+case of Boston is a very poignant one where the Chinese came in
+as low as much as 50 percent below some other competitors and
+so Massachusetts waved FTA dollars, there's no Buy America
+protections, there's no Federal dollars involved in this
+project and they have just used State money and therefore the
+Chinese are able to build many components and the shells and
+ship them over here so unless we have an outright Federal ban
+or some Federal law that says, you can't do this, I would
+assume that States continue to buy because of price.
+ Miss Rice. So I am just wondering how we sound the alarm
+bell. I mean, I just don't know, if we are allowing elected
+Members of Congress to be more concerned about preserving jobs
+in their districts than they are a National security, we have a
+problem so if you wouldn't mind, Mr. Olson, just talking a
+little bit, can you just expound on that more because this has
+to be done. If this administration does not think that this is
+a priority, it is not going to trickle down, it is just not.
+ Mr. Olson. I agree with you wholeheartedly. We are a 3-
+year-old organization. We started because we saw this market
+entry in such a quick fashion and the 4 contracts quickly
+awarded to CRRC. They have built a freight assembly facility in
+Wilmington, North [inaudible] so opportunities like this to
+testify and get in front of more Members, I mean, we are
+advocacy; we are trying to get in front of as many Members of
+Congress, and State and local officials to raise the alarm
+bells and we are partnering as much as possible with officials
+within the Trump administration to raise more awareness.
+ Miss Rice. Well, I want to thank Chairman Correa, very much
+for actually you know, putting this hearing together.
+ I want to thank all of you so much because we sit here in
+this little bubble here in Washington and you know, the very
+common theme that I have heard from everyone who has sat at
+that table is, we have to keep the lines of communication open.
+This is not a private-sector issue. This is not a public-sector
+issue. This is a Keep America Safe issue, and Our Democracy
+Safe issue, and I hope that you know, going forward and I know
+with people like you will be able to; I hope we can have this
+conversation in a bipartisan fashion so thank you all for being
+here.
+ I yield back the balance of my time.
+ Mr. Correa. Thank you, Miss Rice. I agree with you about
+sounding the alarm. It is a very interesting question.
+ Now I would like to recognize, Mrs. Watson Coleman, from
+New Jersey.
+ Mrs. Watson Coleman. Thank you. Thank you, Mr. Chairman.
+ So if we have these companies that are owned by the Chinese
+company making things in the United States of America,
+technically we could have professionals from security,
+cybersecurity whatever to be able to go in, announced and
+unannounced and check right----
+ Mr. Olson. Of course.
+ Mrs. Watson Coleman. We probably could?
+ Mr. Olson. Yes.
+ Mrs. Watson Coleman. Do we? Do you know, if we do?
+ Mr. Lewis. It does not work and so that is the main
+problem.
+ Mrs. Watson Coleman. It does not work, why?
+ Mr. Lewis. It does not work because first a lot of the--it
+never did.
+ Mrs. Watson Coleman. Yes.
+ Mr. Lewis. Pardon me. A lot of the technology is connected
+back to the manufacturer----
+ Mrs. Watson Coleman. OK.
+ Mr. Lewis. So that they can do updates; you don't know if
+it is malicious traffic or innocent traffic. Second there is
+just a lot of opportunities in rail car or an airplane to
+hide----
+ Mrs. Watson Coleman. We are just trying to figure this out.
+ You know, Mr. Olson, this one paragraph [inaudible] what do
+you think the Federal Government's role should be here in
+ensuring that this does not happen here?
+ Mr. Olson. So first off, RSA's continued position is,
+taxpayers' dollars should not be used to be subsidizing the
+state-owned enterprise from China period, end of story.
+ Second, I would love to work with all of you as we look at
+other ways to do bans or outright bans on this technology from
+being on our system. I think it is too scary to allow Chinese
+government-directed company to operate in the United States
+especially when they are building a good chunk of the materials
+in China itself.
+ Mrs. Watson Coleman. Because the interest actually is not
+blowing us up as it is much as just owning us?
+ Mr. Olson. Tracking us.
+ Mrs. Watson Coleman. Owning us.
+ WMATA which oversees the Washington Metro System was
+currently working to procure new rail cars and updates its
+procurement requirements to include the enhanced [inaudible]
+safeguards.
+ Mr. Olson. RSA's position is as, Mr. Lewis, stated, it is
+never enough. If you are going to be building components and
+parts in China, you can never do enough to mitigate. Our
+position at RSA continues to be risk avoidance, let's just not
+buy them.
+ Mrs. Watson Coleman. So let's not allow our money to be
+spent on purchasing Chinese----
+ Mr. Olson. Correct.
+ Mrs. Watson Coleman. OK.
+ I am good. Thank you.
+ I yield back.
+ Mr. Correa. Thank you very much for those questions.
+ Now I would like to recognize the good lady from Texas, Ms.
+Jackson Lee.
+ Ms. Jackson Lee. Thank you very much Mr. Chairman.
+ Having just come in, let me first of all thank the
+witnesses of the first panel and thank those of the second
+panel [inaudible] events I have been on this committee since 9/
+11 and have seen the maturing of terrorist potential and
+utilization of now technology different from bringing down a
+plane or using it as a torpedo into major structures here in
+the United States, though it certainly is well-known that
+certain elements still believe that aviation is a crucial and
+serious part, but I would be interested--or infrastructure is a
+crucial and serious part of potential of attacking the United
+States.
+ So, I am going to ask each of your question as to whether
+or not you are--do you think we are fully prepared for zero-day
+potential events; start with, Ms. Gagliostro?
+ Ms. Gagliostro. So I would say, in dealing with any sort of
+cybersecurity threats, the most important way for us to be
+prepared and respond is through working with our Federal
+partners on having strong information sharing on what we are
+learning so zero-day threats are always a challenge because it
+is what you don't know yet but I think being cognizant of the
+threat indicators and patterns of behavior and paying attention
+to those that we can be alerted to those threats quickly as
+possible.
+ Ms. Jackson Lee. You think the United States should address
+those questions through legislation that would emphasize the
+partnership between the Federal Government and the private
+sector?
+ Ms. Gagliostro. I think the best way to address that is
+through strong partnership between the Federal Government and
+the private sector.
+ Ms. Jackson Lee. So legislation that dictates that would be
+helpful?
+ Ms. Gagliostro. To the extent that we don't think it is
+effective today.
+ Ms. Jackson Lee. Mr. Lewis.
+ Mr. Lewis. Thank you. First, I would distinguish between
+state and non-state actors. No terrorist group currently has
+the capability nor will acquire in the foreseeable future the
+capability to launch a damaging cyber attack. This has been
+true for years, it is based on evidence from a number of----
+ Mr. Correa. Could you repeat that please?
+ Mr. Lewis. No terrorist group currently has the capability
+to launch a damaging cyber attack.
+ Ms. Jackson Lee. But please know that my zero-day is not
+limited to nation-states.
+ Mr. Lewis. Exactly right. We have 4 very capable opponents
+who have certainly done the reconnaissance to launch these
+kinds of attacks against----
+ Ms. Jackson Lee. Why don't you just recite their names for
+the records?
+ Mr. Lewis. Russia, China, Iran, and North Korea, right,
+they all have the capability, it is a question of when they
+would use it so on the defensive side all the work that you
+have heard from my colleagues, perhaps some improvement in
+standards.
+ On the offensive side, as we discussed earlier [inaudible].
+ Ms. Jackson Lee [continuing]. Be effective focusing the
+Government on those issues?
+ Mr. Lewis. Ma'am, I have asked senior officials at DHS, if
+they need more legislative authority, their position is no, but
+I think it would be useful to look and see where there are gaps
+in the existing legislation that might help them do better at
+protecting------
+ Ms. Jackson Lee. Then they do need it because there are
+gaps.
+ Mr. Olson [continuing]. And then, Mr. Hultquist, you
+follow?
+ Mr. Olson. I would agree with my colleagues on the panel
+here and we would not oppose further legislation if it gives
+more authority to fill as you said gaps for DHS.
+ You know, our position from the Rail Security Alliance is
+that we have already allowed the Chinese in and that we need to
+stop the bleeding and not have them further infiltrate more
+transit systems and especially the freight systems so we are
+looking at it from that angle of hardware in the United States
+already.
+ Ms. Jackson Lee. Thank you.
+ Mr. Hultquist. We have had good success anticipating a lot
+of these events by looking at the places where these actors are
+most active--Ukraine, the Middle East, South Korea--so I would
+argue that getting that information, the observables out of
+those spaces to the private sector who would likely bear the
+brunt of any attack is probably the most important thing we can
+do.
+ Ms. Jackson Lee. So if you have any legislation that
+focuses on some of the elements that you have just mentioned--
+--
+ Mr. Hultquist. Absolutely, enforcing public-private
+partnership I think would be really important.
+ Ms. Jackson Lee. Just last question, Mr. Chairman,
+cybersecurity is becoming harder because of the connected
+nature of wireless technology, how long can we secure large
+complex systems when very small devices can pose risks? Whoever
+feels most capable to answer that question, I would be
+delighted.
+ Mr. Lewis. I will start. We can't secure them now so it is
+hard to see how it gets much worse but I think that as you add
+more and more connected devices, the ability to create some
+sort of havoc--we talked about the smart doorbells.
+ Another one I just heard about is you know, those visible
+braces you have got? Some of them are connected to the internet
+and you can just think of endless numbers of complications,
+between smart cars, smart ships, robots; they are moving into a
+world where the number of things that can be hacked is growing
+exponentially.
+ Ms. Jackson Lee. Thank you.
+ So anyone else on how do we--yes sir?
+ Mr. Hultquist. We add more potential for disruption but we
+also add more factors for the threat actors to gain access to
+critical systems or systems that we care about.
+ Ms. Jackson Lee. Anyone else.
+ Mr. Chairman, I will just conclude by saying that there are
+gaping holes with our cyber system. This committee is best
+suited to try to address those questions and gaping holes can
+create opportunities for havoc and I think this committee and
+the Oversight on Transportation, Natural Gas, is crucial in its
+work and I hope we will pass legislation dealing with some of
+these very large holes that----
+ Mr. Correa. I concur with you, Ms. Jackson Lee, and I
+think----
+ Ms. Jackson Lee. They create danger.
+ Mr. Correa. We have got a job to do here in terms of
+addressing those gaping holes.
+ It seems like every time we turn around there is a new
+toothbrush with a chip on it so when you are brushing your
+teeth somebody's going to know how many times you do it a day
+and my point is there is no privacy anymore and it looks like
+all of our information is interconnected in some form or
+another, whether it is a commercial venture, a state somewhere
+around the world so, Mr. Lewis, you intrigue me again with your
+comments about the deterrence, is there a price to pay for what
+and when, and when does that trigger?
+ Good questions.
+ I want to thank all the witnesses for their valuable
+testimony and all the Members here for their questions.
+ The Members of the committee may have additional questions
+for the witnesses and we ask that you respond to them
+expeditiously and in writing. Pursuant to Committee Rule
+VII(D), the hearing record will be held open for [inaudible].
+ Thank you to all the committee Members, of both committees,
+or I should say panels.
+ We stand adjourned.
+ [Whereupon, at 12:22 p.m., the subcommittees were
+adjourned.]
+
+ [all]
+
+
+
+