National Infrastructure Protection Center
NIPC Daily Open Source Report for 31 December 2002

Daily Overview

.       The Washington Post reports that U.S. intelligence officials
have identified approximately 15 cargo freighters around the world that
they believe are controlled by al Qaeda or could be used by the
terrorist network.  (See item 4) 

.       The Canadian Press reports experts say it's only a matter of
time before there is a concerted, politically motivated attack on the
Internet or a piece of computer-dependent infrastructure such as the
electrical grid.  (See item 12)

.       The Washington Post reports that as the new airport measures go
into effect, all checked bags must be screened for explosives, although
the method will vary by airport.  (See item 5)

.       Reuters reports the price of oil is now above $33 a barrel,
influenced by a possible war with Iraq and the continuing crisis in
Venezuela.  (See item 7)

.       The San Francisco Chronicle reports water officials are
considering desalination to prevent serious drought in the future.  (See
item 8)

Editor's Note: Beginning January 6, 2003, the NIPC Daily Open Source
Report will be aligned to cover the critical infrastructure sectors as
identified in the National Strategy for Homeland Security.  Currently
covered sectors, which were set forth in Presidential Decision Directive
63, are included in the new format.  The new Sector alignment will be as
follows: Agriculture, Food, Water, Public Health, Emergency Services,
Government, Defense Industrial Base, Information and Telecommunications,
Energy (to include Electric Power, and Oil and Gas), Transportation,
Banking and Finance, Chemical Industry and Postal and Shipping.  Readers
wishing to comment on the contents or suggest additional topics and
sources should contact Melissa Conaty at 202-324-0354 or Kerry J.
Butterfield at 202-324-1131.  Requests for adding or dropping
distribution to the NIPC Daily Open Source Report should be made through
the Watch and Warning Unit at [EMAIL PROTECTED] 

NIPC Daily Report Fast Jump [click to jump to section of interest]
Banking & Finance

Gas & Oil

Emergency Law Enforcement

Government Operations
Information Technology
Cyber Threats and Vulnerabilities

Internet Alert Dashboard
NIPC Information

Power Sector

1.      December 30, Platts Energy News - Fermi-2 scrams from 75% power
on control rod problem.  A few minutes after midnight Sunday, operators
at the Newport, Michigan Southern Nuclear's Fermi-2 manually scrammed
the reactor and placed it in hot shutdown after losing the ability to
drive control rods, the Nuclear Regulatory Commission said in its events
notification report.  Just before the scram occurred, the 1,116-MW
nuclear reactor was being shut down from 100% power because of a low
output voltage condition.  Power was lowered using core flow to 75%.
The low MPU 3 voltage allowed selection of control rods but would not
allow control rods to be inserted.  Source: 

2.      December 27, Daily News, New York - Sparks fly over planned
Brooklyn, NY power plant.  The billion-dollar, 1,100-megawatt
cogeneration facility proposed on N. 12th St., on the border of
Williamsburg and Greenpoint, would clean up a toxic site, improve air
quality and give the revitalizing waterfront a sleek new signature
building, according to TransGas Energy Systems, which is seeking state
approval for the plant which will convert natural gas into electricity.
"It will become an anchor and an economic engine, providing jobs,
generating millions of dollars in economic activity and spurring
additional future investment," said TransGas President Adam Victor.  But
community activists have a different take on the project -- Adam
Perlmutter, an attorney and board member of Greenpoint Waterfront
Association Parks, said "Something like this will be the death knell for
waterfront revitalization."  Borough President Marty Markowitz, City
Councilman David Yassky (D-North Brooklyn), Assemblyman Joseph Lentol
(D-North Brooklyn) and Rep. Nydia Velazquez (D-Brooklyn) have spoken out
against the power plant proposal.  Source:

Current Electricity Sector Threat Alert Levels:  Physical: ELEVATED,
Scale:  Low, Guarded, Elevated, High, Severe   [Source: ISAC for the
Electricity Sector (ES-ISAC) -]

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Banking and Finance Sector

3.      December 26, Comptroller of the Currency - Bank Secrecy
Act/Anti-Money Laundering: Notice of Designation--Designation of Nauru
and Ukraine as Primary Money Laundering Concerns.  This document states
that it is believed by the Comptroller that the foreign banks listed
within the document currently or in the past maintained correspondent
accounts with Nauru-licensed financial institutions.  The overwhelming
majority of Nauru-licensed financial institutions are believed to be
shell banks.  As a service to U.S. financial institutions, the
Comptroller is providing this information to assist them in their
compliance with their obligations under section 313 of the USA PATRIOT
Act, which, among other things, requires U.S. financial institutions to
take reasonable steps to ensure that they do not indirectly provide
correspondent services to foreign shell banks.  The provision of this
list should not be construed as an implication of wrongdoing by the
listed institutions.  This is not intended to be an exhaustive list, but
does represent current information.  Source: 

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Transportation Sector

4.      December 31, Washington Post - 15 freighters believed to be
linked to al Qaeda.  U.S. intelligence officials have identified
approximately 15 cargo freighters around the world that they believe are
controlled by al Qaeda or could be used by the terrorist network to
ferry operatives, bombs, money or commodities over the high seas,
government officials said.  American spy agencies track some of the
suspicious ships by satellites or surveillance planes and with the help
of allied navies or informants in overseas ports.  But they have
occasionally lost track of the vessels, which are continuously given new
fictitious names, repainted or re-registered using invented corporate
owners, all while plying the oceans.  Concerned about the
vulnerabilities of American shipping since Sept. 11, 2001, U.S.
officials have started paying more attention than ever to what cargo is
loaded onto ships entering U.S. waters, and to who serves on crews, as
well as to stowaways and individuals who appear to be surveying U.S.
ports.  In addition, U.S. intelligence agencies have set up large
databases to track cargo, ships and seamen in a search for "anomalies"
that could indicate terrorists on approaching ships, said Frances
Fragos-Townsend, chief of Coast Guard intelligence.  "If all you do is
wait for ships to come to you, you're not doing your job," she said.
"The idea is to push the borders out."  Source:

5.      December 30, Washington Post - Travelers brace for new airport
measures.  Holiday travelers who left before Christmas may have a
different airport experience if they fly home after New Year's Day.
Their checked bags likely will be searched for explosives, although the
method "machine, human hands or dogs" will vary by airport.  And at more
than 40 airports, travelers with only carry-on bags no longer can go
straight to the gate.  They'll have to make a detour to the ticket
counter or a kiosk to get a boarding pass.  The changes are bound to
create problems, said Michael Boyd, a Denver-based airline consultant.
He offered this advice: Don't check anything and get there very early.
"It could be total chaos," he said.  The new security is overseen by the
Transportation Security Administration, (TSA), created after the Sept.
11 attacks to protect travelers from terrorists.  In the past year, the
agency has hired more than 50,000 people, distinguished by their white
shirts and yellow embroidered badges, to screen passengers and baggage
at 424 commercial airports.  Now the TSA is in the midst of adding
another layer of security: screening all checked bags for explosives.
It's an enormous undertaking since an estimated 1.5 billion bags get
checked at U.S. airports every year.  Small airports can easily meet the
requirement that all bags be screened because they can use
labor-intensive methods such as searching by hand and using a wand that
detects explosives residue on the outside of bags.  Larger airports need
more efficient SUV-sized bomb-detection machines.  Source:

6.      December 30, U.S. Coast Guard - Maritime Security.  The Coast
Guard is holding seven public meetings to discuss requirements for
security assessments, plans, and specific security measures for ports,
vessels, and facilities.  Discussions will aid the Coast Guard in
determining the types of vessels and facilities that pose a risk of
being involved in a transportation security incident, and in identifying
security measures and standards to deter such incidents.  Discussions
will also focus on aligning domestic maritime security requirements with
the International Ship and Port Facility Security (ISPS) Code and recent
amendments to the International Convention for the Safety of Life at Sea
(SOLAS), to comply with section 102 (Port security) of the recently
enacted Maritime Transportation Security Act of 2002 (MTSA).  The Coast
Guard encourages interested individuals and organizations to attend the
meetings and submit comments for discussion during the meetings.  The
Coast Guard also seeks comments from anyone unable to attend the
meetings. NOTE: The full text of the notice incorporates a backgrounder
and several appendices to include Appendix C Cost Analysis Report for
Vessel, Facility, and Port Security, December 20, 2002 by USCG
Headquarters, Standards Evaluation & Analysis Divisions.  Source:

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Gas and Oil Sector

7.      December 30, Reuters - U.S. oil above $33 as possible war looms.
Oil prices charged higher again Monday as traders bet on a U.S. attack
against Iraq early next year and as supplies from OPEC nation Venezuela
stayed choked off by a strike now in its fifth week.  U.S. light crude
futures set a new two-year high in early trade of $33.65 a barrel, up 93
cents from Friday.  Prices edged briefly off session highs on word from
an OPEC delegate that the oil producer cartel could increase supply in
mid-January unless the current market spike subsides by then.  Oil has
risen more than $5 in December and prices are now more than $10 higher
than at the start of 2002.  Concerns are growing that costly energy
bills could stifle global economic recovery.  London Brent crude rose 86
cents to hit $31.02 a barrel, a 15-month high.  In Venezuela, opposition
leaders extended a nationwide strike into Monday, marking the 29th day
of action aimed at forcing the resignation of President Hugo Chavez and
early elections.  Data from Venezuela's state oil firm PDVSA and
independent shippers showed government efforts to break the strike
helped boost oil exports to about 520,000 barrels per day (bpd) in the
week to Dec. 29 compared with 260,000 bpd in the previous week.  Source: 

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Telecommunications Sector

Nothing to report.

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Food Sector

Nothing to report.

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Water Sector

8.      December 30, San Francisco Chronicle (California) - Desalination
mulled in San Francisco Bay area.  Water officials in Marin County, CA,
like many coastal areas of the United States, are considering
desalination to prevent serious drought in the future.  The Marin
municipal water district is studying desalination for the waters of San
Pablo Bay, which could provide 5 million to 10 million gallons of
drinking water a day, enough to serve as many as 30,000 homes a year.
Even in the absence of drought, experts say there soon will not be
enough water in California available for the number of people moving
into the state.  Studies have shown that it could cost as much as $100
million to build a plant in Marin and put in pipelines.  Source:  

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Chemical Sector

Nothing to report.

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Emergency Law Enforcement Sector

December 30, Associated Press - In preparation for the New Year's Eve
celebration, the New York City Police Department sealed manholes,
removed Times Square mailboxes and described plans to deploy transit
officers to subway stations, undercover cops throughout the crowd and
snipers to nearby rooftops.  The photographs of several foreign-born men
sought by the FBI for questioning about possible connections to people
involved in terrorism were distributed to officers citywide on Sunday,
Police Commissioner Ray Kelly said.  New York City is one place where
investigators have focused their search for the men, believed to have
entered the United States from Canada, but Kelly said there was no other
reason to believe the men are in the area.  For the celebration, Kelly
said "a couple thousand" officers would be on duty, similar to last
year, with an added focus on the transit system in midtown and citywide.
Bomb squads will sweep Times Square, and participants will be searched
as they enter the area.  Large bags and alcohol are prohibited.  Source: 

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Government Operations Sector

9.      December 26, New York Daily News - Unmanned drones will guard
U.S. coastlines.  The Coast Guard is getting up to 70 remote-controlled
aircraft that it can launch from its cutters, extending its eyes for
miles.  The first of the $3 million Eagle Eye drones, which take off
like a helicopter but tilt their rotors to fly like a plane, could be on
patrol by 2006.  "They'd be used for maritime homeland defense,
fisheries enforcement, counter-narcotics patrols and possibly for search
and rescue," said Coast Guard Cmdr. John Fitzgerald.  "Right now, out at
sea, you're limited to the range of a helicopter."  The Eagle Eye drones
can fly up to 220 knots and have a range of 750 nautical miles - 80
percent faster and farther than the Coast Guard's short-range
helicopter, the HH-65 Dolphin.  Source: 

10.     December 30, General Accounting Office - Military Readiness:
Civil Reserve Air Fleet (CRAF) can respond as planned, but incentives
may need revamping.  The incentives currently in place to encourage
participation in the CRAF program, especially the incentive to
participate in DoD's peacetime business, might be losing effectiveness
and could become disincentives in the future.  Some participants are not
able to bid on peacetime cargo business because their fleets do not
include B-747s, the predominant aircraft DoD uses for peacetime cargo
missions.  GAO found that B-747s carried 94 percent of 946 missions
flown by commercial aircraft in the first 10 months of fiscal 2002.
Furthermore, over 40 percent of recent missions did not use all
available space or weight limits aboard B-747s.  These missions might
have been carried out less expensively with smaller wide-body aircraft.
Using smaller aircraft would provide more peacetime business to a
greater share of the program participants, thus enhancing current
incentives.  However, the Air Force does not have sufficient management
information to identify options for selecting the best available
aircraft type for the mission.  Source:  Report:

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Information Technology Sector

11.     December 30, Gulf News - Mideast firms urged to focus on
e-security.  E-security is the prime concern of the Internet driven
business environment and Middle Eastern companies should adopt
pre-emptive safety measures to save their assets, an United Arab
Emirates (UAE) official said yesterday.  "The awareness of e-business
security issues is admittedly low in the Middle East's corporate world
compared with the advanced markets and this is dangerous," said Dr. Omar
bin Sulaiman, Chief Executive Officer of the company Dubai Internet
City.  He was a keynote speaker at the 'E-Security Solutions
Exhibition', organized by the students of the Al Ain Women's College
(AAWC) located in the city of Al Ain, UAE.  Dr. Sulaiman said that most
businesses in the Middle East merely react to security threats, rather
than assessing risks to manage their security strategically.  He said
that companies have to make a strategic commitment to ensure effective
security.  Most of the companies in the Middle East shy away from making
this commitment as can be seen in the widespread lack of a security
budget.  "For companies doing business online, security spending must be
an integral part of overall e-business spending."  Source.

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Cyber Threats and Vulnerabilities

12.     December 30, Canadian Press - Experts say Internet vulnerable to
cyber attack.  The war on terror and the prospect of hostilities with
Iraq have the sentinels of cyberspace bracing for trouble.  Experts say
it's only a matter of time before someone mounts a concerted,
politically motivated attack on the Internet or a piece of
computer-dependent infrastructure such as the electrical grid.  Despite
growing security awareness, especially in the wake of the September 11,
2001, terrorist attacks, many critical systems remain open to intrusion
and disruption, authorities in both the private and public sectors
agree.  "The problem at this point is that the vulnerabilities are so
numerous one has a hard time trying to decide where to start," said
Andrew McAllister, director of cyber protection at the federal Office of
Critical Infrastructure and Emergency Preparedness in Canada.  There's
no published evidence such a strike has taken place yet, and some
experts believe cyber attacks remain more of a nuisance threat for now.
The Canadian Security Intelligence Service, responsible for assessing
the cyber threat, won't reveal which potentially hostile groups or
countries have the capability.  Source.

Internet Alert Dashboard
Current Alert Levels

Internet Security Systems 
AlertCon: 1 out of 4
Security Focus ThreatCon: 1 out of 4

Last Changed: 26 December 2002  Last Changed: 21 December 2002
Current Virus and Port Attacks
Virus:  #1 Virus in USA:   PE_FUNLOVE.4099
Source:, Trend World Micro Virus
Tracking Center [Infected Computers, North America, Past 24 hours, #1 in
United States]
Top 10 Target Ports     137(netbios-ns); 80 (http); 1433(ms-sql-s);
445(microsoft-ds); 21(ftp); 443(https); 53(domain); 4662;
139(netbios-ssn); 1524(ingreslock)
Source:; Internet Storm Center

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General Information

13.     December 30, New York Times - Paris airport worker held after
weapons seizure.  The French police detained five men on Saturday,
including a baggage handler at Charles de Gaulle Airport in whose car
weapons, explosives and detonators were discovered, French television
reported sunday night.  The airport employee was identified only as a
French citizen of Algerian origin, 27, and a resident of Bondy, a
heavily Muslim neighborhood in the northeast of Paris.  According to the
report, a search of the man's home led to the arrest of his father and
two brothers as well as a family friend.  Investigators found an
automatic weapon, a machine gun, five packages of plastic explosives and
two detonators, according to the report, citing officials involved in
the investigation.  Agence France-Presse, also citing investigators,
said it was unclear whether the baggage handler, who did not have a
criminal record, was linked to terrorists or to the underworld.  The
officials were quoted as saying that the man had no known links to
radical Islamic groups.  Source:

14.     December 28, Denver Post (Colorado) - Wyoming finds third case
of CWD.  A third case of chronic wasting disease (CWD) has been
confirmed in Carbon County, WY a sign the wildlife disease may be
spreading.  The latest case involved a mule deer shot by a hunter this
fall between Laramie and Arlington Wyoming.  Statewide 2,100 of the
2,300 samples submitted by hunters have been tested, with about 100
infected deer identified, said Hank Edwards, a Wyoming Game and Fish
wildlife disease specialist who tracks chronic wasting disease.  The
Game and Fish Department will step up its surveillance, Edwards said.

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NIPC Products & Contact Information

The National Infrastructure Protection Center (NIPC) serves as a
national critical infrastructure threat assessment, warning,
vulnerability, and law enforcement investigation and response entity.
The NIPC provides timely warnings of international threats,
comprehensive analysis and law enforcement investigation and response.
The NIPC provides a range of bulletins and advisories of interest to
information system security and professionals and those involved in
protecting public and private infrastructures.  By visiting the NIPC
web-site (, one can quickly access any of the
following NIPC products:

2002 NIPC Advisories - Advisories address significant threat or incident
information that suggests a change in readiness posture, protective
options and/or response.

2002 NIPC Alerts - Alerts address major threat or incident information
addressing imminent or in-progress attacks targeting specific national
networks or critical infrastructures.

2002 NIPC Information Bulletins - Information Bulletins communicate
issues that pertain to the critical national infrastructure and are for
informational purposes only.

2002 NIPC CyberNotes - CyberNotes is published to support security and
information system professionals with timely information on cyber
vulnerabilities, malicious scripts, information security trends, virus
information, and other critical infrastructure-related best practices. 

2002 NIPC Highlights - The NIPC Highlights are published on a monthly
basis to inform policy and/or decision makers of current events,
incidents, developments, and trends related to Critical Infrastructure
Protection (CIP).  Highlights seeks to provide policy and/or decision
makers with value-added insight by synthesizing all source information
to provide the most detailed, accurate, and timely reporting on
potentially actionable CIP matters.

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