Full Orlando 911 transcript released; gunman pledged allegiance to Islamic State

Makeshift memorial for victims of Pulse shooting

By Barbara Liston

ORLANDO, Fla. (Reuters) – The U.S. Justice Department and the FBI on Monday released what they said was the complete transcript of the phone conversation between the Orlando, Florida, shooter and 911 police operators as he threatened to strap explosives to his hostages.

The release of the full transcript came a few hours after the FBI had issued an edited transcript of the calls.

In the full transcript, the gunman, Omar Mateen, is quoted pledging allegiance to Islamic State leader Abu Bakr al-Baghdadi.

Mateen, 29, killed 49 people at a gay nightclub in Florida on June 12, in the deadliest mass shooting in modern U.S. history. He threatened to detonate a car rigged with bombs and to strap hostages into explosive vests, according to transcripts of the 911 calls he made while police tried to rescue people trapped in the club.

The FBI and Justice Department said they had released a redacted transcript of the conversations because of sensitivity to the interests of survivors and victims’ families, and the integrity of the investigation.

But the first transcript led U.S. House of Representative Speaker Paul Ryan and other politicians to call for the release of a full transcript after a political battle over gun violence brewed in the U.S. Congress.

Mateen’s conversations with a dispatcher and crisis negotiators were made public as police sought to fend off criticism that they may have acted too slowly to end a three-hour standoff at the Pulse nightclub in Orlando.

“You people are gonna get it and I’m gonna ignite it if they try to do anything stupid,” Mateen said during one of the calls, according to the FBI transcript.

(Additional reporting by Letitia Stein in Tampa, Frank McGurty in New York, and Eric Beech, Mohammad Zargham and Patricia Zengerle in Washington; Writing by Fiona Ortiz and Daniel Wallis; Editing by Bill Trott)

Fifty people killed in massacre at Florida gay nightclub: police

Friends/Family mourning at Orlando shooting

By Barbara Liston

ORLANDO, Fla. (Reuters) – A gunman killed 50 people and injured 53 in a crowded gay nightclub in the tourist hub of Orlando, Florida, early on Sunday before being shot dead by police, authorities said, in what appeared the deadliest mass shooting in American history.

The shooter was identified as Omar S. Mateen, a man that a senior FBI official said might have had leanings toward Islamic State militants. Officials described the attack as a “terrorism incident” though cautioned that the suspected Islamist connection required further investigation.

The death toll given by Orlando Mayor Buddy Dyer and police to reporters made the attack the deadliest single shooting incident in U.S. history, eclipsing the 2007 massacre at Virginia Tech university, which left 32 dead.

“Today we’re dealing with something that we never imagined and is unimaginable,” Dyer said. Recalling earlier estimates that 20 people had been killed, he added, “It is with great sadness I share that we not have 20 but 50 casualties (dead), in addition to the shooter. There are another 53 …hospitalized.”

A police officer working as a security guard inside the Pulse nightclub, which has operated in downtown Orlando since 2004, exchanged fire with the suspect at about 2 a.m. EDT, police officials said.

A hostage situation quickly developed, and three hours later a squad of officers stormed the club and shot dead the gunman. It was unclear when the gunman shot the victims.

“Do we consider this an act of terrorism? Absolutely, we are investigating this from all parties’ perspective as an act of terrorism,” said Danny Banks, special agent in charge of the Florida Department of Law Enforcement. “Whether that is domestic terrorist activity or an international one, that is something we will certainly get to the bottom of.”

When asked if the FBI suspected the gunman might have had inclinations toward militant Islam, including a possible sympathy for Islamic State, Ronald Hopper, an assistant FBI agent in charge, told reporters: “We do have suggestions that the individual may have leanings toward that particular ideology. But right now we can’t say definitively.”

The FBI said it was still trying to pin down whether the mass shooting was a hate crime against gays or a terrorist act.

President Barack Obama ordered the federal government to provide any assistance needed to Florida police investigating the shooting, the White House said in a statement.

The attacker was carrying an assault rifle and a handgun, Orange County Sheriff Jerry Demings said. He was also carrying an unidentified “device”, Orlando Police Chief John Mina said earlier.

Javer Antonetti, 53, told the Orlando Sentinel newspaper that he was near the back of the dance club when he heard gunfire. “There were so many (shots), at least 40,” he said. “I saw two guys and it was constant, like ‘pow, pow, pow,’.”

Video footage showed police officers and civilians carrying injured people away from the club and bending over others who were lying on the ground. Dozens of police cruisers, ambulances and other emergency vehicles could be seen in the area.

‘HORRIFIC ACT’

Pulse is described on its website as more than “just another gay club.” One of the club’s founders and owners, Barbara Poma, opened it in 2004 in an effort to keep alive the spirit of her brother, who died after battling HIV.

The choice of target was especially heart-wrenching for members of the U.S. lesbian, gay, bisexual and transgender community, LGBT advocacy group Equality Florida said in a statement.

“Gay clubs hold a significant place in LGBTQ history. They were often the only safe gathering place and this horrific act strikes directly at our sense of safety,” the group said. “We will await the details in tears of sadness and anger.”

It was the second deadly shooting at an Orlando night spot in as many nights. Late Friday, a man thought to be a deranged fan fatally shot Christina Grimmie, a rising singing star and a former contestant on “The Voice”, as she was signing autographs after a concert in the central Florida city.

Orlando has a population of 270,930 and is the home of the famed Disney World amusement park and many other tourist attractions that attracted 62 million visitors in 2014.

(Additional reporting by Letitia Stein in Tampa, Colleen Jenkins in Winston-Salem, North Carolina, Chris Michaud in New York and Mary Milliken in Los Angeles; Writing by Frank McGurty and Scott Malone; Editing by Mark Heinrich)

U.S. Men made persistent efforts to join Islamic State

A flag belonging to the Islamic State fighters is seen on a motorbike after forces loyal to Assad recaptured the historic city of Palmyra

By David Bailey

MINNEAPOLIS (Reuters) – Three Somali-American men from Minnesota made persistent efforts to join Islamic State militants in Syria and conspired to help the group, a prosecutor said in closing arguments on Tuesday in their federal jury trial.

Mohamed Farah, Abdirahman Daud and Guled Omar are charged with conspiring to provide material support to Islamic State and commit murder outside the United States, charges that could result in a life sentence for each if they are convicted.

They participated wholeheartedly in the conspiracy from early 2014 through April 2015, Assistant U.S. Attorney John Docherty told jurors in U.S. District Court in Minnesota.

They were going to put themselves under the control of Islamic State, and they knew that they would be ordered to kill and would have to carry out those orders, Docherty said.

In all, prosecutors brought similar charges against 10 men they said were part of a group of extended family and friends who sometimes took classes on Islam together, hung out and also planned to go overseas to fight for the militants the United States has designated a terror group.

Six men pleaded guilty to providing material support to Islamic State, some testifying at trial. A seventh man is believed to be in Syria, leaving Omar, Farah and Daud to face trial.

The trial has exposed tensions in Minnesota’s Somali community, where some believe the men were entrapped.

Docherty said the defendants made “persistent efforts” to join Islamic State and the evidence supported the testimony of friends turned witnesses. Even if you discount their testimony, the tapes show their participation, he said.

“There simply is no entrapment in this case,” Docherty said, adding that the defendants were “itching” to go.

Prosecutors presented two dozen witnesses, plus audiotaped conversations to support charges the defendants planned extensively to travel to Syria and fight with Islamic State, and talked openly of killing people.

Farah and Daud did not present any witnesses during the trial. Omar took the stand, testifying that his taped conversations were boasts or taken out of context.

Defense attorneys said in opening statements that the Islamic State videos were repugnant and the defendants made inflammatory remarks, but the government lacked sufficient evidence to prove the men intended to travel to Syria and fight for Islamic State.

Farah and Daud also are charged with perjury, and Farah with making a false statement to FBI agents. Omar is also charged with attempting to use $5,000 in federal student aid to fund travel to Syria.

Push to expand FBI surveillance authority threatens email privacy bill

A lock icon, signifying an encrypted Internet

By Dustin Volz

WASHINGTON (Reuters) – An effort in the U.S. Senate to expand the Federal Bureau of Investigation’s authority to use a secretive surveillance order has delayed a vote on a popular email privacy bill, casting further doubt on whether the legislation will become law this year.

The Senate Judiciary Committee on Thursday postponed consideration of a measure that would require government authorities to obtain a search warrant before asking technology companies, such as Microsoft and Alphabet Inc’s Google , to hand over old emails. A version of the Senate bill unanimously passed the House last month.

Currently, federal agencies do not need a warrant to access emails or other digital communications more than 180 days old due to a provision in a 1986 law that considers them abandoned by the owner.

But Republican party senators offered amendments Thursday that privacy advocates argued contravened the purpose of the underlying bill and would likely sink its chances of becoming law.

Those amendments include one by Senator John Cornyn, the second ranking Republican in the Senate, that would broaden the FBI’s authority to deploy an administrative subpoena known as a National Security Letter to include electronic communications transaction records such as the times tamps of emails and their senders and recipients.

Senators Patrick Leahy and Mike Lee, the Democratic and Republican authors of the email privacy bill, agreed to postpone the vote to give time to lawmakers to review the amendments and other provisions of the bill that have prompted disagreement.

NSLs do not require a warrant and are almost always accompanied by a gag order preventing the service provider from sharing the request with a targeted user.

The letters have existed since the 1970s, though the scope and frequency of their use expanded greatly after the Sept. 11, 2001 attacks on the United States.

In 2015 requests for customer records via NSLs increased nearly 50 percent to 48,642 requests, up from 33,024 in 2014, according to a U.S. government transparency report.

The Obama administration has for years lobbied for a change to how NSLs can be used, after a 2008 legal memo from the Justice Department said the law limits them largely to phone billing records. FBI Director James Comey has said the change needed essentially corrects a typo.

The Senate Intelligence Committee this week passed a bill to fund the U.S. intelligence community that contains a similar provision that would allow NSLs to be used to gather email records.

Senator Ron Wyden, an Oregon Democrat, voted against the proposal and said it “takes a hatchet to important protections for Americans’ liberty.”

(Reporting by Dustin Volz; Editing by Alan Crosby)

FBI paid more than $1.3 million to break into San Bernardino iPhone

Apple Logo

By Julia Edwards

WASHINGTON (Reuters) – Federal Bureau of Investigation Director James Comey said on Thursday the agency paid more to get into the iPhone of one of the San Bernardino shooters than he will make in the remaining seven years and four months he has in his job.

According to figures from the FBI and the U.S. Office of Management and Budget, Comey’s annual salary as of January 2015 was $183,300. Without a raise or bonus, Comey will make $1.34 million over the remainder of his job.

That suggests the FBI paid the largest ever publicized fee for a hacking job, easily surpassing the $1 million paid by U.S. information security company Zerodium to break into phones.

Speaking at the Aspen Security Forum in London, Comey was asked by a moderator how much the FBI paid for the software that eventually broke into the iPhone.

“A lot. More than I will make in the remainder of this job, which is seven years and four months for sure,” Comey said. “But it was, in my view, worth it.”

The Justice Department said in March it had unlocked the San Bernardino shooter’s iPhone with the help of an unidentified third party and dropped its case against Apple Inc <AAPL.O>, ending a high-stakes legal clash but leaving the broader fight over encryption unresolved.

Comey said the FBI will be able to use software used on the San Bernardino phone on other 5C iPhones running IOS 9 software.

There are about 16 million 5C iPhones in use in the United States, according to estimates from research firm IHS Technology. Eighty-four percent of iOS devices overall are running iOS 9 software, according to Apple.

The FBI gained access to the iPhone used by Rizwan Farook, one of the shooters who killed 14 people in San Bernardino, California on Dec. 2.

The case raised the debate over whether technology companies’ encryption technologies protect privacy or endanger the public by blocking law enforcement access to information.

(Reporting by Julia Edwards in Washington; additional reporting by Julia Love in San Francisco; Editing by Simon Cameron-Moore)

FBI issues ransomware alert, requests help from U.S. businesses

ransomware

(Reuters) – The FBI is asking businesses and software security experts for emergency assistance in its investigation into a pernicious new type of “ransomware” virus used by hackers for extortion.

“We need your help!” the Federal Bureau of Investigation said in a confidential “Flash” advisory that was dated March 25 and obtained by Reuters over the weekend.

Ransomware is malicious software that encrypts a victim’s data so they cannot gain access to it on their computers, then offers to unlock the system in exchange for payment.

Friday’s FBI alert was focused on ransomware known as MSIL/Samas.A that the agency said seeks to encrypt data on entire networks, an alarming change because typically, ransomware has sought to encrypt data one computer at a time.

The plea asked recipients to immediately contact the FBI’s CYWATCH cyber center if they find evidence that they have been attacked or have other information that might help in its investigation.

It is the latest in a series of FBI advisories and warnings from security researchers about new ransomware tools and techniques.

“This is basically becoming a national cyber emergency,” said Ben Johnson, co-founder of Carbon Black, a cyber security firm that on Friday uncovered another type of ransomware that seeks to attack PCs through infected Microsoft Word documents.

The FBI first reported on MSIL/Samas.A in a Feb. 18 alert that lacked the urgency of Friday’s warning. The February message contained some technicals details but did not call for help. It said that MSIL/Samas.A targets servers running out-of-date versions of a type of business software known as JBOSS.

In its latest report, the FBI said that investigators have since found that hackers are using a software tool dubbed JexBoss to automate discovery of vulnerable JBOSS systems and launch attacks, allowing them to remotely install ransomware on computers across the network.

The FBI provided a list of technical indicators to help companies determine if they were victims of such an attack.

“The FBI is distributing these indicators to enable network defense activities and reduce the risk of similar attacks in the future,” the advisory said.

FBI representatives did not respond to requests for comment on the confidential warning.

The sectors hardest hit by ransomware include industries that rely on computer access for performing critical functions, such as healthcare and law enforcement. Publicly reported attacks in which hospitals and police have paid ransoms, then recovered data, has encouraged attackers to further target those groups, cyber security experts said.

(Reporting by Jim Finkle; editing by Grant McCool)

U.S. charges three Syrian hackers, Justice Department says

WASHINGTON (Reuters) – U.S. authorities have charged three Syrian nationals who are current or former members of the Syrian Electronic Army with multiple conspiracies related to computer hacking, the U.S. Justice Department said on Tuesday.

Ahmad Umar Agha, 22, and Firas Dardar, 27, were charged with a criminal conspiracy that included “a hoax regarding a terrorist attack” and “attempting to cause mutiny of the U.S. armed forces,” the department said in a statement. Dardar and Peter Romar, 36, were separately charged with other conspiracies, it said.

The FBI announced on Tuesday it was adding Agha and Dardar to its Cyber Most Wanted list and offering a reward of $100,000 for information leading to their arrest, the statement said.

Agha and Dardar, who are believed to reside in Syria, began their criminal activities in or around 2011 under the name of the Syrian Electronic Army in support of the Syrian government, the statement said.

In June 2015, the U.S. Army said it temporarily took down its website after the Syrian Electronic Army hacked into the site and posted messages.

(Reporting by Washington Newsroom)

U.S. says it may not need Apple to open San Bernardino iPhone

(Reuters) – U.S. prosecutors said Monday that a “third party” had presented a possible method for opening an encrypted iPhone used by one of the San Bernardino shooters, a development that could bring an abrupt end to the high-stakes legal showdown between the government and Apple Inc.

A federal judge in Riverside, California, late Monday agreed to the government’s request to postpone a hearing scheduled for Tuesday so that the FBI could try the newly discovered technique. The Justice Department said it would update the court on April 5.

The government had insisted until Monday that it had no way to access the phone used by Rizwan Farook, one of the two killers in the December massacre in San Bernardino, California, except to force Apple to write new software that would disable the password protection.

The Justice Department last month obtained a court order directing Apple to create that software, but Apple has fought back, arguing that the order is an overreach by the government and would undermine computer security for everyone.

The announcement on Monday that an unnamed third party had presented a way of breaking into the phone on Sunday – just two days before the hearing and after weeks of heated back-and-forth in court filings – drew skepticism from many in the tech community who have insisted that there were other ways to get into the phone.

“From a purely technical perspective, one of the most fragile parts of the government’s case is the claim that Apple’s help is required to unlock the phone,” said Matt Blaze, a professor and computer security expert at the University of Pennsylvania. “Many in the technical community have been skeptical that this is true, especially given the government’s considerable resources.”

Former prosecutors and lawyers supporting Apple said the move suggested that the Justice Department feared it would lose the legal battle, or at minimum would be forced to admit that it had not tried every other way to get into the phone.

In a statement, the Justice Department said its only interest has always been gaining access to the information on the phone and that it had continued to explore alternatives even as litigation began. It offered no details on the new technique except that it came from a non-governmental third party, but said it was “cautiously optimistic” it would work.

“That is why we asked the court to give us some time to explore this option,” a spokeswoman for the Justice Department, Melanie R. Newman, said. “If this solution works, it will allow us to search the phone and continue our investigation into the terrorist attack that killed 14 people and wounded 22 people.”

It would also likely end the case without a legal showdown that many had expected to reach the U.S. Supreme Court.

An Apple executive told reporters on a press call that the company knew nothing about the Justice Department’s possible method for getting into the phone, and that the government never gave any indication that it was continuing to search for such solutions.

The executive characterized the Justice Department’s admission Monday that it never stopped pursuing ways to open the phone as a sharp contrast with its insistence in court filings that only Apple possessed the means to do so.

Nate Cardozo, staff attorney at the Electronic Frontier Foundation, a civil liberties group backing Apple, said the San Bernardino case was the “hand-chosen test case” for the government to establish its authority to access electronic information by whatever means necessary.

In that context, he said, the last-minute discovery of a possible solution and the cancellation of the hearing is “suspicious,” and suggests the government might be worried about losing and setting a bad precedent.

But George Washington University law professor Orin Kerr, a former Justice Department computer crime prosecutor, said the government was likely only postponing the fight.

“The problem is not going away, it’s just been delayed for a year or two,” he said.

Apple said that if the government was successful in getting into the phone, which might involve taking advantage of previously undiscovered vulnerabilities, it hoped officials would share information on how they did so. But if the government drops the case it would be under no obligation to provide information to Apple.

In opposing the court order, Apple’s chief executive, Tim Cook, and his allies have argued that it would be unprecedented to force a company to develop a new product to assist a government investigation, and that other law enforcement agencies around the world would rapidly demand similar services.

Law enforcement officials, led by Federal Bureau of Investigation Director James Comey, have countered that access to phones and other devices is crucial for intelligence work and criminal investigations.

The government and the tech industry have clashed for years over similar issues, and Congress has been unable to pass legislation to address the impasse.

(Reporting by Joseph Menn, additional reporting by Mari Saito; Editing by Leslie Adler and Andrew Hay)

FBI warns automakers, owners about vehicle hacking risks

WASHINGTON (Reuters) – The FBI and U.S. National Highway Traffic Safety Administration (NHTSA) issued a bulletin Thursday warning that motor vehicles are “increasingly vulnerable” to hacking.

“The FBI and NHTSA are warning the general public and manufacturers – of vehicles, vehicle components, and aftermarket devices – to maintain awareness of potential issues and cybersecurity threats related to connected vehicle technologies in modern vehicles,” the agencies said in the bulletin.

In July 2015, Fiat Chrysler Automobiles NV recalled 1.4 million U.S. vehicles to install software after a magazine report raised concerns about hacking, the first action of its kind for the auto industry.

Also last year, General Motors Co issued a security update for a smartphone app that could have allowed a hacker to take control of some functions of a plug-in hybrid electric Chevrolet Volt, like starting the engine and unlocking the doors.

In January 2015, BMW AG said it had fixed a security flaw that could have allowed up to 2.2 million vehicles to have doors remotely opened by hackers.

“While not all hacking incidents may result in a risk to safety – such as an attacker taking control of a vehicle – it is important that consumers take appropriate steps to minimize risk,” the FBI bulletin said Thursday.

NHTSA Administrator Mark Rosekind told reporters in July 2015 that automakers must move fast to address hacking issues.

The Fiat Chrysler recall came after Wired magazine reported hackers could remotely take control of some functions of a 2014 Jeep Cherokee, including steering, transmission and brakes. NHTSA has said there has never been a real-world example of a hacker taking control of a vehicle.

Two major U.S. auto trade associations — the Alliance of Automobile Manufacturers and Association of Global Automakers — late last year opened an Information Sharing and Analysis Center. The groups share cyber-threat information and potential vulnerabilities in vehicles.

The FBI bulletin Thursday warned that criminals could exploit online vehicle software updates by sending fake “e-mail messages to vehicle owners who are looking to obtain legitimate software updates. Instead, the recipients could be tricked into clicking links to malicious Web sites or opening attachments containing malicious software.”

(Reporting by David Shepardson; Editing by Kenneth Maxwell)

Apple fight could escalate with demand for ‘source code’

SAN FRANCISCO (Reuters) – The latest filing in the legal war between the planet’s most powerful government and its most valuable company gave one indication of how the high-stakes confrontation could escalate even further.

In what observers of the case called a carefully calibrated threat, the U.S. Justice Department last week suggested that it would be willing to demand that Apple turn over the “source code” that underlies its products as well as the so-called “signing key” that validates software as coming from Apple.

Together, those two things would give the government the power to develop its own spying software and trick any iPhone into installing it. Eventually, anyone using an Apple device would be unable to tell whether they were using the real thing or a version that had been altered by officials to be used as a spy tool.

Technology and security experts said that if the U.S. government was able to obtain Apple’s source code with a conventional court order, other governments would demand equal rights to do the same thing.

“We think that would be pretty terrible,” said Joseph Lorenzo Hall, chief technologist at the nonprofit Center for Democracy & Technology.

The battle between Apple and the U.S Justice Department has been raging since the government in February obtained a court order demanding that Apple write new software to help law enforcement officials unlock an iPhone associated with one of the shooters in the December attack in San Bernardino, California that killed 14 people.

Apple is fighting the order, arguing that complying with the request would weaken the security of all iPhones and create an open-ended precedent for judges to make demands of private companies.

The Justice Department’s comments about source code and signing keys came in a footnote to a filing last week in which it rejected Apple’s arguments. Apple’s response to the DOJ brief is expected on Tuesday.

Justice Department lawyers said in the brief that they had refrained from pursuing the iOS source code and signing key because they thought “such a request would be less palatable to Apple. If Apple would prefer that course, however, that may provide an alternative that requires less labor by Apple.”

The footnote evoked what some lawyers familiar with the case call a “nuclear option,” seeking the power to demand and use the most prized assets of lucrative technology companies.

A person close to the government’s side told Reuters that the Justice Department does not intend to press the argument that it could seize the company’s code, and someone on Apple’s side said the company isn’t worried enough to counter the veiled threat in its brief due Tuesday.

But many people expect the iPhone matter to reach the U.S. Supreme Court, and thus even fallback legal strategies are drawing close scrutiny.

ODDS OF SUCCESS UNCLEAR

There is little clarity on whether a government demand for source code would succeed.

Perhaps the closest parallel was in a case filed by federal prosecutors against Lavabit LLC, a privacy-oriented email service used by Edward Snowden. In trying to recover Snowden’s unencrypted mail from the company, which did not keep Snowden’s cryptographic key, the Justice Department got a court order forcing the company to turn over another key instead, one that would allow officials to impersonate the company’s website and intercept all interactions with its users.

“Lavabit must provide any and all information necessary to decrypt the content, including, but not limited to public and private keys and algorithms,” the lower court ruled.

Lavabit shut down rather than comply. But company lawyer Jesse Binnall said the Fourth Circuit Court of Appeals, which upheld the lower ruling, did so on procedural grounds, so that the Justice Department’s win would not influence much elsewhere.

In any case, full source code would be even more valuable than the traffic key in the Lavabit case, and the industry would go to extreme lengths to fight for it, Binnall said.

“That really is the keys to the kingdom,” Binnall said.

Source code is sometimes inspected during lawsuits over intellectual property, and the Justice Department noted that Apple won permission to review some of rival Samsung’s &lt;005930.KS> code in one such case. In that case and similar battles, the code is produced with strict rules to prevent copying.

No cases brought by the government have led to that sort of code production, or at least none that have come to light.

But intelligence agencies operate under different rules and have wide latitude overseas. Some advanced espionage programs attributed to the United States used digital certificates that were stolen from Taiwanese companies, though not full programs.

U.S. software code may have been sought in other cases, such as investigations relying on the Patriot Act or the Foreign Intelligence Surveillance Act (FISA), which applies within American borders.

Several people who have argued before the special FISA court or are familiar with some of its cases say they know of no time that the government has sought source code.

(Reporting by Joseph Menn; Editing by Jonathan Weber and Cynthia Osterman)