Exclusive: What DHS and the FBI learned from the OPM breach

A culture of poor cyber hygiene plagues the Office of Personnel Management and "likely aided the adversary" in the large-scale hack of the agency, according to a Department of Homeland Security and FBI report obtained by FCW. A lack of strong IT policies leaves OPM "at high risk for future intrusions," investigators concluded.

"Convenience and accessibility [have] been prioritized over critical security practices," states the Dec. 23 "cyber alert," distributed to cleared contractors by the Defense Security Service on behalf of DHS and the FBI. "Inadequate" patching of OPM's sub-system is "symptomatic of a greater patching problem" within the agency, the document states. The breach, revealed in June 2015, led to the loss of more than 21 million personnel records.

The unclassified memo reveals just what computer security experts at DHS' Computer Emergency Readiness Team and the FBI have learned from a hack that has roiled Uncle Sam's personnel agency, infuriated lawmakers and changed the cybersecurity conversation in Washington. The quietly distributed, dispassionate analysis is arguably more instructive for information security professionals than the hours of congressional hearings that have been devoted to the breach.

The memo lists a slew of generally recommended security practices based on the OPM breach, including: enable a personal firewall at agency workstations; monitor users' online habits and block potentially malicious sites; employ encryption for data at rest and in transit; and investigate "outbound network traffic observed over TCP port 53 that does not conform to the DNS [Domain Name System] protocol."

The document does not name OPM, referring only to "Organization 1" in a summary of lessons learned from two recent cyber incidents. But at least six cyber intelligence experts, some of whom are former officials, reviewed the document and said the unnamed organization is in all likelihood OPM based on several key data points. Two OPM officials who viewed the document also said "Organization 1" bore all the hallmarks of their agency.

The timeline, scope and aftermath of the breach, along with the technical infrastructure employed by the organization, all point to the OPM hack, the analysts said. Further, vendors listed as affiliated with "Organization 1," correspond with OPM's vendor relationships.

The fallout from the breach cost former OPM Director Katherine Archuleta her job and has put intense pressure on CIO Donna Seymour to carry out a sweeping overhaul of the agency's IT infrastructure.

"The timing of the breach discovery and the reference to IBM mainframes all match what we know about the OPM breach," Richard Stiennon, chief research analyst at IT-Harvest, told FCW after reviewing the document.

"Given the timing, the specifics of the intrusion, the tech infrastructure referenced, the type of data that was stolen, and the mitigations presented, this is almost certainly referring to the OPM breach," said a former government official. "The large impact of the penetration" described in the document also points to OPM, added another former cyber intelligence official.

Spokespeople at the Pentagon and DHS declined to authenticate the document or otherwise comment.

Identity management could have mitigated hack

The FBI and DHS analysis in the memo emphasizes that the severity of the OPM breach could have been mitigated had the agency employed "tiered" identity management controls for system administrators.

"When an organization's network is not segmented from others, this could mean hundreds of sub-networks are affected versus one," the memo states. Privileged access controls "would have helped detect the intrusion earlier and made it significantly more difficult for the actor to spread across the network."

"Organization 1" is in the process of boosting identity management via two-factor authentication from IT security firm Xceedium, the memo notes, advising the agency to ensure that there is no way for administrators to bypass Xceedium controls.

Hackers used stolen credentials from contractor KeyPoint Government Solutions to access OPM networks. The intruders likely accessed OPM's local-area network on May 7, 2014, then planted malware and created a backdoor for exfiltration, according an official government timeline of the breach obtained by FCW. It would be nearly a year before OPM officials knew they had a problem, according to the timeline.

The Dec. 23, 2015, DSS alert also alludes to the ongoing shift at federal agencies from a cyber defense based on known security signatures to a "continuous monitoring" approach.

Moving away from a reliance on a "signature-based system" would increase an agency's "ability to detect and defend against more sophisticated malware and zero-day exploits," the memo states. The agency should make greater use of "centralized aggregation and correlation of host events, network flows, and behavioral based analysis strategies" for cyber intelligence, according to the memo.

It was such a "signature-based system" -- DHS' Einstein intrusion-detection program -- that helped OPM discover the breach, albeit months after the fact.

The OPM hack has given greater urgency to a sweeping cybersecurity program known as Continuous Diagnostics and Mitigation, which offers a system of dashboards that give network managers a clearer view of vulnerabilities.

OPM has enlisted Booz Allen Hamilton and Campbell, Calif.-based ForeScout Technologies for cyber defense tools under CDM. The agency already has deployed ForeScout's continuous monitoring platform to OPM data centers, according to Niels Jensen, ForeScout's regional vice president of federal sales.

"You can't protect what you can't see," Jensen said, describing his firm's philosophy.

Jeff Wagner, OPM's director of security operations, has said that the full rollout of CDM tools will help the agency with its identity management struggles.

The DSS alert's description of lax IT security in some areas at OPM echoes conclusions from a recent audit by OPM's inspector general. Despite an increased post-breach focus on IT security, the agency continues to struggle to meet many requirements under the Federal Information Security Modernization Act, according to the watchdog.