Archives for June 2021

NYC’s 1,000-lawyer law department targeted by cyberattack

NEW YORK (AP) — New York City’s law department was been hit with a cyberattack that forced officials to take the 1,000-lawyer agency offline, but Mayor Bill de Blasio said he believes no data was compromised in the hack.

“To this hour we have not seen information compromised or a ransom demand,” the Democratic mayor said at a virtual news briefing on Tuesday, adding that the investigation was “evolving.”

City officials said they disconnected the law department’s computers from the city’s network on Sunday, after discovering the cyberattack.

“As the investigation remains ongoing, the City has taken additional steps to maintain security, including limiting access to the Law Department’s network at this time,” de Blasio spokesperson Laura Feyer said in a statement.

Geoff Brown, the city’s chief information security officer, who joined de Blasio at Tuesday’s briefing, said the attack was “not a ransom situation” but declined to discuss possible motives.

“We do fully expect the law department IT environment will be securely reestablished promptly so the law department can get back to the business of serving New Yorkers,” he said.

John Miller, the police department’s deputy commissioner for intelligence and counterterrorism, said the good news was that the system for detecting hackers worked.

“Once there was activity seen that was suspicious, that rang bells between cyber command and its contractors that patrol those systems looking for anomalies,” Miller said. He said the investigation was “still early in the forensics piece.”

Cyberattacks targeting government agencies as well as private companies have become an increasing threat, including last month’s ransomware attack against Georgia-based Colonial Pipeline, which caused widespread gasoline shortages.

“I think people should realize this is something that’s going to be with us for quite a while,” de Blasio said. “And we’re going to have to do a lot to focus on it and constantly protect ourselves.”

US indexes end lower; more volatility for online favorites

A slide in banks and industrial companies nudged stocks on Wall Street to modest losses Wednesday after an early gain faded in the last half-hour of trading. Stocks championed by hordes of online retail investors, the “meme” stocks as they have become known, were volatile once again.

The S&P 500 slipped 0.2%, erasing its meager gain from a day earlier. The benchmark index’s modest moves this week have it on track for its first weekly loss in three weeks. The Dow Jones Industrial Average gave up 0.4%, while the Nasdaq held up somewhat better, ending down just 0.1%.

Treasury yields slipped. The yield on the 10-year Treasury fell to 1.49% from 1.52% late Tuesday. The falling yields broadly weighed down banks, which rely on higher yields to charge more lucrative interest on loans. JPMorgan and Citigroup fell 1.2%.

Several health care companies made solid gains. Merck rose 2.3% after announcing a supply agreement with the U.S. and Canada for a potential COVID-19 treatment. AbbVie gained 1.5% after announcing a collaboration with Caraway Therapeutics to make treatments for Parkinson’s disease and other neurodegenerative disorders.

All told, the S&P 500 fell 7.71 points to 4,219.55. The Dow lost 152.68 points to 34,447.14, while the Nasdaq Composite gave up an early gain, shedding 13.16 points to 13,911.75. The tech-heavy index was lifted by the same Big Tech companies that have pushed it generally higher for the last 18 months. Microsoft rose 0.4% and Amazon added 0.5%.

Small company stocks, which have outgained the broader market this year, also fell. The Russell 2000 index gave up 16.63 points, or 0.7%, to 2,327.13.

Investors continue to focus a significant amount of attention on inflation. China’s producer price index, which measures prices of raw goods and services, jumped 9% from a year earlier in May, the fastest increase since 2008 and above analysts’ forecasts. Surging prices for oil and other commodities and manufacturing components such as semiconductors were the main factor behind the jump in producer prices there.

Aside from surging prices of raw materials, fuel and other items needed for manufacturing, factories are struggling to keep up with demand as the pandemic recedes in many places. That has pushed up prices of everything from food to household staples.

Investors will get closely watched U.S. inflation data on Thursday and how it might impact ultra-low interest rates and other market-supporting policies.

The market has been relatively constrained over the last several days and investors have parsed any data to judge whether rising inflation will be temporary, as the Federal Reserve thinks, or more permanent.

The Labor Department’s release of the consumer price index Thursday will add to that discussion, particularly since it comes shortly before the Federal Reserve’s next meeting on interest rate policy next week.

“Is it transitory, or is the Fed behind the curve?” said Sal Bruno, chief investment officer at IndexIQ. “That is going to be a lot of the discussion tomorrow with people reading into which way we’re going.”

Elsewhere in the market, volatility in stocks embraced by investors using online forums like Reddit continued for another day Wednesday. Clover Health fell 23.6% while AMC Entertainment sank 10.4%. Wendy’s sank 12.7% after soaring 25.9% a day earlier.

The original “meme” stock, GameStop, said after the closing bell Wednesday that it has brought on a pair of Amazon veterans as its new chief executive and chief financial officer to aid in its much anticipated digital turnaround. The company also reported a smaller quarterly loss than a year ago as revenue increased. Its shares fell 3% in after-hours trading.

EXPLAINER: Just how vulnerable is the internet?

BOSTON (AP) — An outage at a little-known firm that speeds up access to websites knocked a lot of top internet destinations offline on Tuesday, disrupting business and leisure for untold millions globally. The problem was quickly resolved. The company, Fastly, blamed a configuration error in its technology.

But the incident — Fastly’s traffic dropped 75% for about an hour just as the U.S. East Coast was beginning to stir —raises questions about how vulnerable the global internet is to more serious disruption.

WHAT’S A FASTLY? WHY DID ITS TECHNICAL PROBLEMS LEAD TO SO MANY OUTAGES?

San Francisco-based Fastly isn’t a household name, but its “edge server” computing technology is used by many of the world’s most popular websites, such as The New York Times, Shopify, the Guardian, Ticketmaster, Pinterest, Etsy, Wayfair and Stripe. The British government is among its clients.

The company provides what’s called a content delivery network — an arrangement that allows customer websites to store data such as images and videos on various mirror servers across 26 countries so that the data is closer to users, and thus shows up faster. Many of Fastly’s customers are news sites that use its technology to update their websites with breaking news. Buzzfeed, for example, used Fastly to cut the time its users took to reach the site by half. Fastly had $290.9 million in revenues last year.

WAS THERE ANY BACKUP? COULD OTHER COMPANIES HAVE STEPPED IN IF THE PROBLEM HAD BEEN MORE SEVERE?

Customers rely on Fastly and its rivals to host and protect their website data from denial-of-service attacks and disruption from spikes in traffic. Had this outage been more serious, customers could have moved to competitors such as Cloudflare or Akamai. But that’s not simple; many businesses would have had to scramble and might have suffered losses.

“You can’t switch quickly to another service unless you had it set up ahead of time,” said Doug Madory, an internet infrastructure expert with the traffic-measuring company Kentik. “If Fastly were down for a day, that would be pretty bad.”

Even if they do have an alternative provider, engineering a smooth switchover from one to another is not for the faint of heart, said Ben April, chief technical officer of Farsight Security.

Madory and other experts said Fastly and its competitors spend heavily and devote major engineering resources to reducing the possibilities of such outages and ensuring they can recover as quickly as Fastly did on Tuesday.

Such outages are not new — but not at all common. “There may be years between when a company has an outage like this,” Madory added. “I think we are going to have these very rare but probably impactful short outages for the foreseeable future.”

ARE OTHER PARTS OF THE INTERNET SIMILARLY VULNERABLE?

Like the content distribution network world, cloud computing — when computing services are entrusted to a remote provider — is dominated by just a few major players led by Amazon Web Services, Google and Microsoft. Amazon, the biggest cloud provider, periodically has brief outages, which are a big deal for customers.

“And if it became a major outage of, say, more than six, eight hours — but days — it could put companies out of business,” said Josh Chessman, an analyst with the tech market researcher Gartner Inc.

The question is: What could cause such a serious outage that might destroy customer data? A major cyberattack is one possibility. Another is fire or catastrophic natural disaster. These businesses, after all, are based in datacenters. In March, a fire at a datacenter in Strasbourg, France, owned by a major cloud computing firm knocked out service to millions of websites.

SHOULD THE GOVERNMENT REGULATE THESE FIRMS? WHAT CAN COMPANIES AND INDIVIDUALS DO TO PROTECT THEMSELVES?

“I don’t know that we need regulation,” Chessman said. Suppose Congress proposed to mandate additional cloud providers to increase competition. “How do you do that?” he asked.

Of course, the federal government can set new standards for security at companies that control vast data resources online. It’s already beginning to tighten up cybersecurity requirements for critical infrastructure in the energy sector following last month’s cyberattack on the Colonial Pipeline, he said.

In a regulatory filing last year, Fastly said it had been subject to “cyber-attacks from third parties — including parties who we believe are sponsored by government actors.” Those attacks “have strained our network” and could harm it in the future, it said.

Businesses and consumers, meanwhile, should be thinking seriously about how much they should rely on the cloud for their most valuable data. “If there’s an outage, what’s the impact on our business?” Chessman asked. Perhaps it makes sense not to rely on a cloud-based service for your company’s email if you’d go bankrupt without it during a two-week outage.

But running your own email and backup services is complicated and costly — one reason companies turned to the cloud in the first place.

David Vaskevitch, a former Microsoft chief technical officer and CEO of the photo management app Mylio, said people have grown so accustomed to the always-on internet —- everywhere we go, we carry a pocket computer with us — that we wrongly assume it will be available 24/7/365.

“It’s not very realistic and it’s not a good way to live,” said Vaskevitch, who at 67 grew up in a pre-digital world. “The internet is always there — until it isn’t.”

Despite the vast interconnectedness of the world, it can still be wise to store some data locally, said Vaskevitch. Instead of streaming all our music, we should think about saving some locally. Same goes for email — for instance, in an arrangement where you store it on the computing device you use most.

“Your device is both the best friend of the internet and the best insurance policy,” he said. “When the internet goes down, if you arrange things carefully, you can still do most of the things you need to do.”

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An earlier version of this story misspelled the name of Gartner analyst Josh Chessman.

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O’Brien reported from Providence, Rhode Island. Kelvin Chan in London contributed to this report.

EU report: Illicit drug sales moved online during lockdowns

MADRID (AP) — Illegal drug production on European soil increased during the coronavirus pandemic last year as lockdowns helped move drug sales from streets to encrypted online platforms, according to an analysis of continental drug trends released Wednesday.

The 2021 European Drug Report says criminal groups also adapted to travel restrictions and border closures by relying less on human couriers and turning instead to shipping containers and commercial supply chains to smuggle illicit substances.

The report is produced annually by the European Monitoring Centre for Drugs and Drug Addiction drawing data from the European Union’s 27 member countries, Turkey and Norway.

Its authors said that while strict stay-at-home orders in most countries disrupted street drug sales, the market moved to encrypted messaging and social media platforms for negotiating purchases and to home delivery services for distribution.

“This draws attention to whether a long-term impact of the pandemic could be the further digitalization of drug markets,” the EMCDDA report states..

There were 46 new drugs detected in 2020 alone, including new synthetic cannabinoids and opioids, the report said.

European Commissioner for Home Affairs Ylva Johansson said “the highly pure and potent substances” found in the surveyed countries were a cause of special concern.

Illegal drug usage in general, she warned, carries environmental, health and security risks for the EU.

The issue “corrupts the fabric of our society, fueling violence and risking the health and security of our citizens,” , Johansson said in a statement.

The EMCDDA described the European drug market as “dynamic and adaptive,” as well as “resilient to COVID-19 restrictions,” with patterns of drug use “increasingly complex.”

The report raises specific concerns around the misuse of benzodiazepines, which are prescribed for treating anxiety but have been linked to poisonings and deaths from unauthorized use.

Amphetamine and methamphetamine production is on the rise, the report said. Cannabis availability did not decline during the pandemic, according to 2020 preliminary data, it said.

Although cannabis use remained stable at high levels, authorities across Europe seized a record 235 tons of cocaine in 2019, up from 195 tons the year before.

Startup Lordstown Motors warns it may not stay in business

DETROIT (AP) — Startup commercial electric vehicle maker Lordstown Motors says it may not be in business a year from now as it tries to secure funding to start full production of an electric pickup truck.

In a quarterly regulatory filing Tuesday, Lordstown said the $587 million it had on hand as of March 31 isn’t enough to start commercial production and begin selling the full-size pickup, called the Endurance.

“These conditions raise substantial doubt regarding our ability to continue as a going concern for a period of at least one year,” the company said in the filing with the Securities and Exchange Commission.

Shares of the company, which is set up in a now-closed General Motors plant east of Cleveland, fell 16.2% to close Tuesday at $11.22. The lost another 3% in after-hours trading.

On May 24, CEO Steve Burns warned that production could be cut by over half to only 1,000 vehicles this year unless Lordstown raised an undisclosed amount of new capital.

Tuesday’s SEC filing appears to be much more dire. “Going concern” is a term companies typically use when noting that their outside auditors are questioning their ability to remain in business.

Lordstown reported a first-quarter net loss of $125 million and said it had a deficit of $259 million as of March 31.

The filing said management is evaluating new sources of capital, including issuing more equity or borrowing from partners, government or financial institutions.

“There can be no assurance that such financing would be available to us on favorable terms or at all,” the filing said.

Burns said in May the company expects to lose up to $380 million this year, but he assured investors that Lordstown will end 2021 with at least $50 million in cash.

He said the company expects to start making the Endurance in September.

The $52,500 Endurance has passed two of the U.S. government’s toughest crash tests, and it will beat Ford Motor Co.’s electric F-150 to market, he said, adding that Lordstown has purchase agreements for about 30,000 of the trucks.

A company spokesman said he could not comment beyond Burns’ guidance from May.

Archives for June 2021

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