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Progress in War Against ISIS?; Details Emerging About Bureau 121; Can High Tech Hacks Be Prevented?; White House Not Ruling Out Castro Visit

Aired December 19, 2014 - 07:30   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

(COMMERCIAL BREAK)

MICHAELA PEREIRA, CNN ANCHOR: Almost 7:30 in the East. Here's a look at your headlines.

Following highly publicized security breaches, an independent review finds the Secret Service is stretched beyond its limits. A panel says the agency needs more training, more staff, and concluded the service is too insular, and needs a director from the outside -- outside its ranks. The review also recommended the White House fence be raised, saying it needs to be at least four or even five feet higher.

President Obama is expected to field plenty of questions today, given all that's going on in the world as the end of his year conference, his news conference that will happen at 1:30 this afternoon. CNN will have live coverage of that.

Among the issues that he's likely to address, his executive action on immigration, historic move to restore diplomatic relations with Cuba and the Senate's CIA torture report. The first family will then head to Hawaii for the holidays.

Tough times at the IRS could mean tough times for your wallet. Budget cuts at the agency could mean getting your tax refund will probably take longer this year. How much longer? That's unclear.

The IRS commissioner says half the people who call for help this filing season, well, you're not going to be able to get through to an actual person and once tax returns are filed, there are going to be fewer agents to audit them.

Anyone who works for or with the city of South Pittsburgh, Tennessee, you better bite your tongue on social media. City leaders just approved a policy forbidding city workers or contractors for saying anything negative about their city on social media.

Their argument, well, it's becoming harder to do business when bad things get posted online. As would you expect, the city's decision is generating all kinds of negative publicity, some of it, go figure, online including fake Twitter accounts. And the cyber-world has spoken, Alisyn.

ALISYN CAMEROTA, CNN ANCHOR: I hear that loud and clear. Thanks, Michaela. There is some progress to report in the battle against ISIS, a senior U.S. military official tells CNN that airstrikes have killed three ISIS leaders in recent weeks. Are these newest developments proof that the offensive is working?

Joining us to talk about this is Lieutenant General Mark Hertling. He is a CNN military analyst and a retired former commanding general for Europe and the Seventh Army. General, it's nice to see you this morning.

LT. GENERAL MARK HERTLING, CNN MILITARY ANALYST: Good morning, Alisyn. How are you?

CAMEROTA: I'm well. Where are we today with the fight against ISIS? Is progress being made?

HERTLING: Well, I think the announcement yesterday by my good friend, Lieutenant-General James Terry, who is commanding the forces in Iraq and Syria, had some very good news to it.

When he's talking about the three key figures that were killed in strikes in late November and early December, key elements of the fight, they were the top military commander in Iraq for al-Baghdadi.

They were -- it also included the emir of Mosul, which is a critical position for the forces, and also one of the key advisers, Mr. Al Turkmeni, who is inner circle compadre of Mr. Baghdadi.

So those three plus a few others that they did not name are critically important for the continued fight and the attrition of Daiche in Iraq.

CAMEROTA: So that does sound impressive. They do sound as though they would have an impact. But realistically speaking, what will change with those three gone?

HERTLING: Well, whenever you have strikes against key targets like this, it continues to hurt the organization at the key leadership level. It's affecting their command and control of the organization. They will always replace them very quickly, but with people who are not as capable.

That's what you're trying to do against this kind of complex insurgency, continuing to strike the individuals who are leading the organization. Put Mr. Baghdadi in a spot where he has to maneuver folks around and endanger some of his key areas, especially Mosul.

I think we're looking at the Iraqi forces attempting to seize Mosul in the near future and I think these are all critical strikes that will contribute to that.

CAMEROTA: President Obama agrees with you. He believes that the coalition has momentum against ISIS. Here's what he had to say this week.

(BEGIN VIDEO CLIP) BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Because of you, we have blunted their momentum and we have put them on the defensive. And these terrorists are learning the same thing that the leaders of al Qaeda have learned the hard way.

They may think that they can chalk up some quick victories, but our reach is long, we do not give up. You threaten America. You will have no safe haven.

(END VIDEO CLIP)

CAMEROTA: General, that sounds good. It is comforting. But it feels as though this is the never-ending game of whack-a-mole. Because they have such good recruitment efforts, there's always just more to fill the ranks.

HERTLING: The difference this time, Alisyn, is the Iraqi government is actually beginning to step up. We're seeing that in many areas. The replacement of some of their key generals, the reach from Baghdad out to Mosul in the northern and western provinces, the arming of the National Guard, what they're terming the Iraqi national guard, what we call the sons of Iraq, but the tribal men who would continue to fight and provide security.

And again, it was an argument that we always had when we were in Iraq. They needed to want it better. They needed to want it more than we did. And now, I think we're beginning to see that the Iraqi government is wanting it more.

They are wanting security. They're looking at ways to reach out to the Kurds to reach out to the Sunni provinces and all of those are very important.

CAMEROTA: General, last, how do you characterize what happened in Sydney in this cafe where there was one lone apparent depraved is sympathizer who brought the city to its knees for a day?

HERTLING: Well, there's been great commentary on that over the last few days. And it has to do with the fact that various extremist Islamic organizations are reaching out to people by saying, if you can't join us in Iraq and Syria, do whatever you can.

And I think it's a danger all over the world, not just in Australia, but in our country as well. We've got to continue to be alert. And truthfully, these kind of, these kinds of attacks are very difficult to thwart.

We can pass intelligence. We can try and defend ourselves. But you have one Looney Tune like this who does something extremely bizarre, and kills a lot of people, or attempts to kill a lot of people. It's just -- somewhat unstoppable truthfully.

CAMEROTA: That is the most chilling message. General Mark Hertling, thanks so much. It's nice to see you this morning.

HERTLING: Thanks, Alisyn. CAMEROTA: OK, let's go back to Chris.

CHRIS CUOMO, CNN ANCHOR: All right, so back to the Sony situation, it is easy to say Sony should have put the movie out, free expression matters most of all. That's easy to say if you don't understand the risk of the situation that motivated Sony's decision.

What is Bureau 121, the shadowy off shot of the North Korean government specializing in virtual war? We have a North Korean defector who says he knows about it and he is ahead.

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CAMEROTA: U.S. officials believe North Korea is responsible for the crippling attack on Sony pictures and there's increasing focus on a mysterious unit called Bureau 121.

Experts say North Korea withheld resources from its own citizens to build up this unit to carry out cyber-attacks. For more on this, let's get right to Kyung Lah live from Seoul. What do we know, Kyung?

KYUNG LAH, CNN CORRESPONDENT: Well, Alisyn, think of them as the shadow warriors, and their battleground is cyberspace, they're placed around the world, taking their orders from Pyongyang, with one common goal -- these warriors aim to disrupt western interests.

(BEGIN VIDEOTAPE)

LAH (voice-over): North Korean soldiers, a technicolor parading force against the west. On state-run television -- a near ridiculous bravado of the military, but there are unseen soldiers in Kim Jong- Un's cyber war versus the west. They have no face, and only known by a number, Bureau 121.

(on camera): What is Bureau 121?

(voice-over): They conduct the cyber-attacks overseas and against enemy states, says this North Korean defector, a former Pyongyang military computer systems worker, now in South Korea independently attempting to crumble an agency nearly impossible to chase,

Bureau 121, a shadow agency with an unknown number of the regime's hand-picked shadow agents placed in countries around the world. Chung believes there are approximately 1,800 of them. He says the agents themselves don't know how many exist.

We can't verify Chung's claims about the shadow group. But he says he's obtained from a current operative hundreds of financial files hacked from South Korean banks, complete with names and other bank account details.

Is the cyber war the real war for North Korea? Raising cyber agents is fairly cheap, he says, the world has the wrong view of the North Korean state. With that incorrect world view, North Korea was able to increase its ability to launch cyber-attacks. South Korea learned the hard way -- banks across the country last year were paralyzed, ATMs frozen for days. Media outlets went dark, servers jammed or wiped.

North Korea denied it was a source of a hack. But in the wake of the attack, South Korea beefed up its own cyber forces, declaring the online war -- as dangerous as Pyongyang's nuclear ambitions.

(END VIDEOTAPE)

LAH: North Korea craves most of all to be visible to the global community and with the stunning Sony hack, Chris, they've certainly accomplished just that -- Chris.

CUOMO: So there's an odd contradiction, they want to be known, but they're not taking responsibility if in fact it was this Bureau 121 behind it, hence fueling the intrigue. Kyung, thank you for securing that interview for us. Appreciate it.

So it's not the ability of the North Korean military to break bricks on their faces that has people scared. It's breaking through firewalls that have companies all over the place on heightened alert.

The big question, is it possible to defend yourself from a sophisticated hack? Let's get some guidance from a man once called the most wanted computer hacker in the United States.

With us now is Kevin Mitnick, CEO of mitnicksecurity.com. Mr. Mitnick, thank you for joining us. Are these guys at Bureau 121 better than guys like you?

KEVIN MITNICK, "WORLD'S MOST FAMOUS HACKER": Well, I think Bureau 121 would be pretty sophisticated because you have a nation-state behind it with a lot of money. What these guys probably do is find security flaws in software that they could exploit or they purchase that software.

You know, thinking about Bureau 121, what about the NSA's tailored access operations group? If you remember about the Snowden leaks, the United States has broken into numerous countries' computer systems. So other countries do this as well.

The difference in this case is they attacked a company and revealed all the information and made physical threats against, that affects public safety. But I kind of look at this as this is not really big news because every country attacks each other. It's common.

CUOMO: Right, but it's big news because they raped this company and now they --

MITNICK: Right, I mean --

CUOMO: They stopped a movie coming out.

MITNICK: That's news.

CUOMO: We don't know who did it and we don't know how to stop it that's all big news.

MITNICK: That's the news, but I'm saying that these groups exist, these government-funded hacking groups. That's not news. The other stuff is news, you're correct.

CUOMO: Well, but then how do we stop it? That's the thing, if everybody does it. It seems to suggest equal capabilities. It looks here like the U.S. is caught behind the ball so much that it doesn't even know who did it doesn't know how to respond. What's your take?

MITNICK: Well, it's extremely difficult to protect against cyber- attacks, when companies hire myself and my company to do what we call ethical hacking, penetration testing, our success rate is 99.5 percent. We're able to break into a company.

So if we can do it as a commercial company, think about what a nation- state can do. It's not that difficult. And what companies really need to do is layer on the defenses. Innovative companies need to come up with better security products and services, to help companies like Sony protect their infrastructure.

And I remember recently a reporter shared some documentation that was leaked from Sony, and in the document was talking about Sony's security monitoring, and how it was misconfigured and that they were not correctly monitoring certain parts of their network.

CUOMO: I also saw that you tweeted --

MITNICK: Sony has a problem here, too.

CUOMO: I saw -- let's talk about that I saw that you tweeted, I learned today that the CEO of Sony, Michael Linton's domain user password was Sony ML 3, how stupid is that. Tell me, how stupid is it?

MITNICK: I think it's a pretty stupid password if you ask me. I'm surprised that Sony did not have complexity rules. In other words, the I.t. Department could force users to choose more complex passwords and apparently they didn't do that at Sony.

But to tell you the truth when I'm testing companies the same size of Sony, I find that a lot of I.t. administrators and people in the c- suite pick stupid passwords as well. You can't just blame Mr. Linton here. It's just common practice that companies need to change.

CUOMO: So, OK, let's talk about the possibility of that. So is this that you can do better and make it so that you won't be Sony or is it that -- we haven't developed the capabilities to off-set the capabilities of the hackers, yet?

MITNICK: Well, we can do better to make it much harder for the hackers to break in. But by no means would it be impossible. If an attacker has enough time, money and resources, they usually will be able to get in. But the whole idea of information security is to actually raise the bar high enough so the cost is too high to the attackers so they go to attack somebody else. CUOMO: What should be the collective level of panic? If they want, they can turn off our dams, they can turn off our power grids. They can get to our nuclear weapons and the United States. What should we feel is a safe zone here?

MITNICK: Supposedly the Chinese already breached our critical infrastructure and broke into telecommunications, energy type companies. So it's really nothing new.

But I think this is a big wake-up call because of what happened to Sony. I think companies need to really pay attention and either internally or find other companies on the outside that could actually adequately test their security to find their security vulnerabilities.

The companies could fix those vulnerabilities before, before they're attacked like Sony. So I think it's really important to do these ethical hacking exercises, to find out how secure you are.

CUOMO: And we also have a really unsophisticated dialogue between the private and public sector here, right? The U.S. government has some laws about intel and some policies about intel. The private sector doesn't really talk to the government about what's happening to it. So that's part of the problem here, also, right?

MITNICK: Yes. Well there are certain areas that are regulated by government. Health, you know, any time there's a medical information about a patient, is governed under HIPAA. There's certain you know critical infrastructure. They're governed by government regulations.

Any merchant that processes credit cards, it's not really governed by government at regulations, but the card associations like Mastercard, Visa, American Express require merchants to follow certain rules or they won't be able to process credit cards.

CUOMO: Well, that's part of the problem, though, right? Kevin Mitnick, we got to get everybody on the same page and then start moving forward. Thank you very much for the insight.

MITNICK: We need better technology to help companies stop these types of threats.

CUOMO: Great, go develop it. We'll see you again on the show.

MITNICK: OK.

CUOMO: Later today, President Obama is sure to take lots of questions about North Korea at his end-of-the-year news conference. Can you watch it right here, live, CNN, 1:30 p.m. Eastern Time.

All right, also President Obama was announcing big changes to the U.S. relationship with Cuba. He literally made history all by himself. Now, what will it do?

All right, this was unthinkable for decades. Could there be a visit by a Castro to the White House? We're live from Havana with the latest. (COMMERCIAL BREAK)

PEREIRA: Now to a potentially historic and controversial development involving Cuba. The White House saying it would not rule out the possibility of Cuban President Raul Castro visiting D.C., despite Cuba's history of human rights violations.

I want to turn to Patrick Oppmann, he is in Havana this morning with us. Patrick, really good to have you with us. We've been hearing this normalized relationship to be established with Cuba, that very well could mean a visit. What is the likelihood Raul Castro would come to the White House?

PATRICK OPPMANN, CNN CORRESPONDENT: You know, you think, Michaela, they've made enough history for one week, but here's, is it an invitation, not an invitation? Raul Castro's daughter, Mariel, told me yesterday her father would be willing to go.

But it's an incremental thing, much more likely foreign minister, Cuban Foreign Minister Bruno Rodriguez to the United States first and perhaps see a visit by Secretary Of State John Kerry here, work up a little bit these kinds of visits before you see a head of state visit.

But in terms of President Obama coming here, the invitation from the Cubans is on the table. We looked and never had a sitting U.S. president in Cuba since Calvin Coolidge visited nearly 90 years ago so you have to go way back making history here and certainly breaking some long-held animosity between the two countries.

PEREIRA: President Coolidge in 1928, a long time ago. I'm curious, now this news has settled in, I'm curious what Cubans there you've had a chance to speak to are thinking, where their anxiety level is, what they're worried about, concerned about, what they're hopeful for.

OPPMANN: You know, now that some of the joy has died down they have questions that frankly no one has answers to. For example, if they're normalized relations, will the wall known as wet foot/dry foot which allows any Cuban to receive refugee status when they reach the U.S. shores, allowing them to stay, will that stay in place?

It seems like an archaism with refugees if we have normal relations and they fear the U.S. will now allow even though the embargo is still in place allow Cubans to import construction materials badly needed in this country, everything you see is pretty much falling down.

On the other hand the Cuban government doesn't allow Cubans to do that. Will one embargo being lifted somewhat, but a lot of restrictions here put in place by the Cuban government.

OPPMANN: Patrick Oppmann, we appreciate it. Thank you so much.

Ahead, U.S. officials are expected to layout their evidence today against North Korea over the crippling Sony. The question is, how is North Korea going to respond? Our coverage of this massive cyber- attack continues right after the break. (COMMERCIAL BREAK)