North Korea’s cyber warfare is as perilous as its nuclear potential

 
Charles Arthur
Inter-Korean Summit 2018
North Korea is right, hacking is a magic weapon (Source: Getty)

Everyone’s new favourite dictator, Kim Jong-un, is capturing headlines.

Releasing three Americans who had been taken prisoner on rather vague justifications has, for diplomatic reasons, been hailed as an indication that the man who had his half-brother killed with VX nerve agent is now someone the US can do business with.

The headline for next month’s summit is “denuclearisation”. But there’s one thing that won’t be on the agenda: curbing North Korea’s ambitions in cyber warfare.

Read more: When Donald met Kim: US and North Korean leaders to meet in June

When he came to power at the end of 2011, Kim was already aware that protecting his dictatorship from foreign attack meant developing nuclear weapons. He had also seen how the US had sabotaged Iran’s uranium centrifuges for bomb-making by deploying the Stuxnet computer worm.

Stuxnet, believed to be developed by the US and Israel, was a fiendishly clever piece of malware. It targeted flaws in Microsoft’s Windows, and used those as a stepping stone to the high-speed centrifuges which separate out “heavy” uranium needed to make bombs. The code made the centrifuges speed up and down wildly until they tore themselves apart. Iran’s nuclear programme was delayed by years.

By 2013, South Korea’s intelligence service noted that Kim was talking about cyber warfare capabilities as a “magic weapon” that would let it attack the South, and had seven hacking organisations with 1,700 people working for the government.

It’s a smart strategy because in a sense, hacking is a magic weapon. Done well, it is almost impossible first to detect, and then to trace back. A well-executed hack uses intermediate machines in different countries, so that pointing fingers at culprits is almost impossible. It is very different from tracing a missile trail back to its source.

Kim’s team recognised another benefit of hacking as economic sanctions squeezed its economy: earning money. As the entire annual GDP of the country, at around $17bn, is less than the quarterly revenues that Apple or Samsung get from selling smartphones, every little helps.

And North Korea thought big. In February 2016, its hackers tried to steal $1bn from the international SWIFT banking system by infiltrating a bank in Bangladesh.

Once in, they got the system to demand payments totalling $1bn from various banks. They got $81m, before a single spelling mistake – “fandation” for “foundation” – alerted people at the other banks, who blocked it.

The enormous hype around cryptocurrencies has also led to a hackers’ happy hunting ground: people putting their money into insecure online exchanges. North Korea’s hackers are reckoned to have broken into multiple South Korean crypto exchanges and stolen millions of dollars’ worth of “coins”, which can then be shuffled around and traded for real money.

North Korea was also thought to be behind the “WannaCry” ransomware attack, which encrypted computers across the world and froze many NHS hospitals a year ago. Whether that was really to make money or just to disrupt the west still isn’t clear.

Finally, hacking has helped maintain national pride. When North Korea’s leaders learnt that Sony Pictures (owned by longtime enemy Japan) was making a film called The Interview, a comedy in which Seth Rogen and James Franco killed Kim and liberated the country, they wouldn’t tolerate it.

Early in 2014, they infiltrated the Sony Pictures systems, then that November they wiped every computer, and later anonymously threatened violence if the film was released. (It was, but not in cinemas.) Rogen still doesn’t believe it, but cyber security experts have no doubt.

So while news photos show the handshakes, don’t be in any doubt. North Korea might hedge around the idea of giving up its nukes, but the one thing it definitely won’t do is leave the cyber warfare field.

Read more: North Korea accuses US of ruining peaceful 'atmosphere' in region

City A.M.'s opinion pages are a place for thought-provoking views and debate. These views are not necessarily shared by City A.M.

Related articles