WASHINGTON — An executive at cybersecurity company CrowdStrike apologized in testimony to Congress for sparking a global technology outage over the summer. 

“We let our customers down,” said Adam Meyers, who leads CrowdStrike’s threat intelligence division, in a hearing before a U.S. House cybersecurity subcommittee Tuesday. 

Austin, Texas-based CrowdStrike has blamed a bug in an update that allowed its cybersecurity systems to push bad data out to millions of customer computers, setting off a global tech outage in July that grounded flights, took TV broadcasts off air and disrupted banks, hospitals and retailers. 

“Everywhere Americans turned, basic societal functions were unavailable,” House Homeland Security Committee Chairman Mark Green said. “We cannot allow a mistake of this magnitude to happen again.” 

The Tennessee Republican likened the impact of the outage to an attack “we would expect to be carefully executed by a malicious and sophisticated nation-state actor.” 

“We’re deeply sorry and we are determined to prevent this from ever happening again,” Meyers told lawmakers while laying out the technical missteps that led to the outage of about 8.5 million computers running Microsoft’s Windows operating system. 

Meyers said he wanted to “underscore that this was not a cyberattack” but was, instead, caused by a faulty “rapid-response content update” focused on addressing new threats. The company has since bolstered its content update procedures, he said. 

The company still faces a number of lawsuits from people and businesses that were caught up in July’s mass outage. 
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new york — Caroline Ellison, a former top executive in Sam Bankman-Fried’s fallen FTX cryptocurrency empire, was sentenced to two years in prison on Tuesday after she apologized repeatedly to everyone hurt by a fraud that stole billions of dollars from investors, lenders and customers. 

U.S. District Judge Lewis A. Kaplan said Ellison’s cooperation was “very, very substantial” and “remarkable.” 

But he said a prison sentence was necessary because she had participated in what might be the “greatest financial fraud ever perpetrated in this country and probably anywhere else” or at least close to it. 

He said in such a serious case, he could not let cooperation be a get-out-of-jail-free card, even when it was clear that Bankman-Fried had become “your kryptonite.” 

“I’ve seen a lot of cooperators in 30 years here,” he said. “I’ve never seen one quite like Ms. Ellison.”

She was ordered to report to prison on November 7. 

Ellison, 29, pleaded guilty nearly two years ago and testified against Bankman-Fried for nearly three days at a trial last November. 

At sentencing, she emotionally apologized to anyone hurt by the fraud that stretched from 2017 through 2022. 

“I’m deeply ashamed with what I’ve done,” she said, fighting through tears to say she was “so so sorry” to everyone she had harmed directly or indirectly. 

She did not speak as she left Manhattan federal court, surrounded by lawyers. 

In a court filing, prosecutors had called her testimony the “cornerstone of the trial” against Bankman-Fried, 32, who was found guilty of fraud and sentenced to 25 years in prison. 

In court Tuesday, Assistant U.S. Attorney Danielle Sassoon called for leniency, saying her testimony was “devastating and powerful proof” against Bankman-Fried. 

The prosecutor said Ellison’s time on the witness stand was very different from Bankman-Fried, who she said was “evasive, even contemptuous, and unable to answer questions directly” when he testified. 

Attorney Anjan Sahni asked the judge to spare his client from prison, citing “unusual circumstances,” including her off-and-on romantic relationship with Bankman-Fried and the damage caused when her “whole professional and personal life came to revolve” around him. 

FTX was one of the world’s most popular cryptocurrency exchanges, known for its Superbowl TV ad and its extensive lobbying campaign in Washington before it collapsed in 2022. 

U.S. prosecutors accused Bankman-Fried and other executives of looting customer accounts on the exchange to make risky investments, make millions of dollars of illegal political donations, bribe Chinese officials, and buy luxury real estate in the Caribbean. 

Ellison was chief executive at Alameda Research, a cryptocurrency hedge fund controlled by Bankman-Fried that was used to process some customer funds from FTX. 

As the business began to falter, Ellison divulged the massive fraud to employees who worked for her even before FTX filed for bankruptcy, trial evidence showed. 

Ultimately, she also spoke extensively with criminal and civil U.S. investigators. 

Sassoon said prosecutors were impressed that Ellison did not “jump into the lifeboat” to escape her crimes but instead spent nearly two years fully cooperating. 

Since testifying at Bankman-Fried’s trial, Ellison has engaged in extensive charity work, written a novel, and worked with her parents on a math enrichment textbook for advanced high school students, according to her lawyers. 

They said she also now has a healthy romantic relationship and has reconnected with high school friends she had lost touch with while she worked for and sometimes dated Bankman-Fried from 2017 until late 2022. 
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Washington — The U.S. Commerce Department on Monday proposed prohibiting key Chinese software and hardware in connected vehicles on American roads due to national security concerns — a move that would effectively bar nearly all Chinese cars from entering the U.S. market.

The planned regulation, first reported by Reuters, would also force American and other major automakers in the coming years to remove key Chinese software and hardware from vehicles in the United States.

The Biden administration has raised serious concerns about the collection of data by Chinese companies on U.S. drivers and infrastructure through connected vehicles as well as about potential foreign manipulation of vehicles connected to the internet and navigation systems. The White House ordered an investigation into the potential dangers in February.

The prohibitions would prevent testing of self-driving cars on U.S. roads by Chinese automakers and extend to vehicle software and hardware produced by other U.S. foreign adversaries including Russia.

“When foreign adversaries build software to make a vehicle that means it can be used for surveillance, can be remotely controlled, which threatens the privacy and safety of Americans on the road,” Commerce Secretary Gina Raimondo told a briefing.

“In an extreme situation, a foreign adversary could shut down or take control of all their vehicles operating in the United States all at the same time causing crashes, blocking roads.”

The move is a significant escalation in the United States’ ongoing restrictions on Chinese vehicles, software and components. Earlier this month, the Biden administration locked in steep tariff hikes on Chinese imports, including a 100% duty on electric vehicles as well as new hikes on EV batteries and key minerals.

There are relatively few Chinese-made cars or light-duty trucks imported into the United States. But Raimondo said the department is acting “before suppliers, automakers and car components linked to China or Russia become commonplace and widespread in the U.S. automotive sector… We’re not going to wait until our roads are filled with cars and the risk is extremely significant before we act.”

Nearly all newer cars and trucks are considered “connected” with onboard network hardware that allows internet access, allowing them to share data with devices both inside and outside the vehicle.

A senior administration official confirmed the proposal would effectively ban all existing Chinese light-duty cars and trucks from the U.S. market, but added it would allow Chinese automakers to seek “specific authorizations” for exemptions.

The United States has ample evidence of China prepositioning malware in critical American infrastructure, White House National Security Adviser Jake Sullivan told the same briefing.

“With potentially millions of vehicles on the road, each with 10- to 15-year lifespans the risk of disruption and sabotage increases dramatically,” Sullivan said.

The Chinese Embassy in Washington last month criticized planned action to limit Chinese vehicle exports to the United States: “China urges the U.S. to earnestly abide by market principles and international trade rules, and create a level playing field for companies from all countries. China will firmly defend its lawful rights and interests.”

The proposal calls for making software prohibitions effective in the 2027 model year while the hardware ban would take effect in the 2030 model year or January 2029.

The Commerce Department is giving the public 30 days to comment on the proposal and hopes to finalize it by Jan. 20. The rules would apply to all on-road vehicles but exclude agricultural or mining vehicles not used on public roads.

The Alliance For Automotive Innovation, a group representing major automakers including General Motors, Toyota, Volkswagen and Hyundai, has warned that changing hardware and software would take time.

The group noted connected vehicle hardware and software are developed around the world, including China, but could not detail to what extent Chinese-made components are prevalent in U.S. models.
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Washington — The U.S. Commerce Department is expected on Monday to propose prohibiting Chinese software and hardware in connected and autonomous vehicles on American roads due to national security concerns, two sources told Reuters.

The Biden administration has raised serious concerns about the collection of data by Chinese companies on U.S. drivers and infrastructure as well as the potential foreign manipulation of vehicles connected to the internet and navigation systems.

The proposed regulation would ban the import and sale of vehicles from China with key communications or automated driving system software or hardware, said the two sources, who declined to be identified because the decision had not been publicly disclosed.

The move is a significant escalation in the United States’ ongoing restrictions on Chinese vehicles, software and components. Last week, the Biden administration locked in steep tariff hikes on Chinese imports, including a 100% duty on electric vehicles as well as new hikes on EV batteries and key minerals.

Commerce Secretary Gina Raimondo said in May the risks of Chinese software or hardware in connected U.S. vehicles were significant.

“You can imagine the most catastrophic outcome theoretically if you had a couple million cars on the road and the software were disabled,” she said.

President Joe Biden in February ordered an investigation into whether Chinese vehicle imports pose national security risks over connected-car technology — and if that software and hardware should be banned in all vehicles on U.S. roads.

“China’s policies could flood our market with its vehicles, posing risks to our national security,” Biden said earlier. “I’m not going to let that happen on my watch.”

The Commerce Department plans to give the public 30 days to comment before any finalization of the rules, the sources said. Nearly all newer vehicles on U.S. roads are considered “connected.” Such vehicles have onboard network hardware that allows internet access, allowing them to share data with devices both inside and outside the vehicle.

The department also plans to propose making the prohibitions on software effective in the 2027 model year and the ban on hardware would take effect in January 2029 or the 2030 model year. The prohibitions in question would include vehicles with certain Bluetooth, satellite and wireless features as well as highly autonomous vehicles that could operate without a driver behind the wheel.

A bipartisan group of U.S. lawmakers in November raised alarm about Chinese auto and tech companies collecting and handling sensitive data while testing autonomous vehicles in the United States.

The prohibitions would extend to other foreign U.S. adversaries, including Russia, the sources said.

A trade group representing major automakers including General Motors, Toyota Motor, Volkswagen, Hyundai and others had warned that changing hardware and software would take time.

The carmakers noted their systems “undergo extensive pre-production engineering, testing, and validation processes and, in general, cannot be easily swapped with systems or components from a different supplier.”

The Commerce Department declined to comment on Saturday. Reuters first reported, in early August, details of a plan that would have the effect of barring the testing of autonomous vehicles by Chinese automakers on U.S. roads. There are relatively few Chinese-made light-duty vehicles imported into the United States.

The White House on Thursday signed off on the final proposal, according to a government website. The rule is aimed at ensuring the security of the supply chain for U.S. connected vehicles. It will apply to all vehicles on U.S. roads, but not for agriculture or mining vehicles, the sources said.

Biden noted that most cars are connected like smartphones on wheels, linked to phones, navigation systems, critical infrastructure and to the companies that made them.
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