Obama Establishes Federal Sanctions to Deal With Cyber Attacks

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Barack Obama

Obama issued an executive order creating new federal sanctions against overseas hackers — and their corporate beneficiaries — who steal intellectual property and trade secrets.

President Barack Obama on Wednesday declared a “national emergency” to create a federal sanctions program aimed at penalizing oversees hackers — as well as companies that benefit from their stolen information — in the wake of the hackings last year of Sony Pictures and a number of other U.S. companies.

“Cyber threats pose one of the most serious economic and national security challenges to the United States, and my administration is pursuing a comprehensive strategy to confront them,” Obama said in a statement. “As we have seen in recent months, these threats can emanate from a range of sources and target our critical infrastructure, our companies, and our citizens. This executive order offers a targeted tool for countering the most significant cyber threats that we face.”

Under the president’s executive order, the secretary of the treasury — in consultation with the attorney general and the secretary of state — will have greater power to impose sanctions on individuals or entities that engage in a range of malicious cyber-enabled activities, from stealing intellectual property to “denial of service” attacks on websites. Companies that knowingly benefit from the crimes will also be targeted with sanctions, Obama said. In addition, foreign individuals suspected of engaging in such attacks will be denied entry into the United States.

“I intend to employ the authorities of my office and this administration, including diplomatic engagement, trade policy tools, and law enforcement mechanisms, to counter the threat posed by malicious cyber actors,” Obama said. “This executive order supports the administration’s broader strategy by adding a new authority to combat the most serious malicious cyber threats that we face.”

The announcement follows the Obama administration's allegations that North Korea was behind last year's cyber attack on Sony Pictures. Analysts have also long suspected that hackers based in Russia and China have engaged in state-sponsored pillaging of corporate trade secrets of Western companies.