Critical Infrastructure Protection: Fundamental Improvements Needed to Assure Security of Federal Operations

Published by the Government Accountability Office on 1999-10-06.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                          United States General Accounting Office

GAO                       Testimony
                          Before the Subcommittee on Technology, Terrorism and
                          Government Information, Committee on the Judiciary,
                          U.S. Senate

For Release on Delivery
Expected at
10 a.m.
October 6, 1999           INFRASTRUCTURE

                          Improvements Needed to
                          Assure Security of Federal
                          Statement of Jack L. Brock, Jr.
                          Director, Governmentwide and Defense Information
                          Accounting and Information Management Division

Mr. Chairman and Members of the Subcommittee:

We are pleased to be here today to discuss the “cyber,” or computer
security aspects of critical infrastructure protection. Since the early 1990s,
an explosion in computer interconnectivity, most notably growth in use of
the Internet, has revolutionized the way our government, our nation, and
much of the world communicate and conduct business. The benefits have
been enormous in terms of facilitating communications, business
processes, and access to information. However, without proper safeguards,
this widespread interconnectivity poses enormous risks to our computer
systems and, more importantly, to the critical operations and
infrastructures they support including telecommunications, power
distribution, emergency services, law enforcement, national defense, and
other government services.

Today, I will focus on federal agency performance in addressing computer
security issues. Recent audits by GAO and agency inspectors general (IG)
show that our government is not adequately protecting critical federal
operations and assets from computer-based attacks. These audits show
that 22 of the largest federal agencies have significant computer security
weaknesses. Addressing this widespread and persistent problem requires
significant management attention and action within individual agencies as
well as increased coordination and oversight at the governmentwide level. I
will now provide greater detail on these problems and discuss broader
issues that need to be considered as a national strategy for critical
infrastructure protection is being considered.

Page 1                                                         GAO/T-AIMD-00-7
Weak Controls Place   GAO and IG reports issued over the last 5 years describe persistent
                      computer security weaknesses that place federal operations such as
Federal Programs at   national defense, law enforcement, air traffic control, and benefit payments
Risk                  at risk of disruption as well as fraud and inappropriate disclosures.1 Our
                      most recent analysis, of reports issued during fiscal year 1999, identified
                      significant computer security weaknesses in 22 of the largest federal
                      agencies.2 These included weaknesses in (1) controls over access to
                      sensitive systems and data, (2) controls over software development and
                      changes, and (3) continuity of service plans. These types of weaknesses
                      increase the risk that intruders or authorized users with malicious
                      intentions could read, modify, delete, or otherwise damage information or
                      disrupt operations for purposes, such as fraud, sabotage, or espionage. This
                      body of audit evidence led us, in February 1997 and again in January 1999,
                      to designate information security as a governmentwide high-risk area in
                      reports to the Congress.3

                      Examples of these weaknesses and the risks they present include the

                      • In May 1999, we reported that, as part of our tests of the National
                        Aeronautics and Space Administration’s (NASA) computer-based
                        controls, we successfully penetrated several mission-critical systems.
                        Having obtained access, we could have disrupted NASA’s ongoing
                        command and control operations and stolen, modified, or destroyed
                        system software and data.4

                       Information Security: Opportunities for Improved OMB Oversight of Agency Practices
                      (GAO/AIMD-96-110, September 24, 1996), Information Security: Serious Weaknesses Place
                      Critical Federal Operations and Assets at Risk (GAO/AIMD-98-92, September 23, 1998).
                      Critical Infrastructure Protection: Comprehensive Strategy Can Draw on Year 2000
                      Experiences (GAO/AIMD-00-01, October 1, 1999).
                       High Risk Series: Information Management and Technology (GAO/HR-97-9, February
                      1997) and High Risk Series: An Update (GAO/HR-99-1, January 1999).
                       Information Security: Many NASA Mission-Critical Systems Face Serious Risks
                      (GAO/AIMD-99-47, May 20, 1999).

                      Page 2                                                               GAO/T-AIMD-00-7
• In August 1999, we reported that serious weaknesses in Department of
  Defense (DOD) information security continue to provide both hackers
  and hundreds of thousands of authorized users the opportunity to
  modify, steal, inappropriately disclose, and destroy sensitive DOD data.
  These weaknesses impair DOD’s ability to (1) control physical and
  electronic access to its systems and data, (2) ensure that software
  running on its systems is properly authorized, tested, and functioning as
  intended, (3) limit employees’ ability to perform incompatible functions,
  and (4) resume operations in the event of a disaster. As a result,
  numerous Defense functions, including weapons and supercomputer
  research, logistics, finance, procurement, personnel management,
  military health, and payroll, have already been adversely affected by
  system attacks or fraud.5
• In July 1999, we reported that the Department of Agriculture’s (USDA)
  National Finance Center (NFC) had serious access control weaknesses
  that affected its ability to prevent and/or detect unauthorized changes to
  payroll and other payment data or computer software. NFC develops
  and operates administrative and financial systems, including
  payroll/personnel, property management, and accounting systems for
  both the USDA and more than 60 other federal organizations. During
  fiscal year 1998, NFC processed more than $19 billion in payroll
  payments for more than 450,000 federal employees. NFC is also
  responsible for maintaining records for the world’s largest 401(k)-type
  program, the federal Thrift Savings Program. This program, which is
  growing at about $1 billion per month, covers about 2.3 million
  employees and totaled more than $60 billion as of September 30, 1998.6
  The weaknesses we identified increased the risk that users could cause
  improper payments and that sensitive information could be misused,
  improperly disclosed, or destroyed.
• In October 1999, we reported that Department of Veterans Affairs (VA)
  systems continued to be vulnerable to unauthorized access.7 VA
  operates the largest healthcare delivery system in the United States and
  reported spending more than $17 billion on medical care in fiscal year

DOD Information Security: Serious Weaknesses Continue to Place Defense Operations at
Risk (GAO/AIMD-99-107, August 26, 1999).
USDA Information Security: Weaknesses at National Finance Center Increase Risk of
Fraud, Misuse, and Improper Disclosure (GAO/AIMD-99-227, July 30, 1999).
Information Systems: The Status of Computer Security at the Department of Veterans
Affairs (GAO/AIMD-00-05, October 4, 1999).

Page 3                                                              GAO/T-AIMD-00-7
                            1998. The department also processed more than 42 million benefit
                            payments totaling about $22 billion in fiscal year 1998 and provided life
                            insurance protection through more than 2.4 million policies that
                            represented about $23 billion in coverage. In providing these benefits
                            and services, VA collects and maintains sensitive medical record and
                            benefit payment information for veterans and their family members.
                            GAO, as well as the VA IG, continued to find serious problems that
                            placed sensitive information at increased risk of inadvertent or
                            deliberate misuse, fraudulent use, improper disclosure, or destruction,
                            possibly occurring without detection. For example, at one VA insurance
                            center, 265 users who had not been authorized access had the ability to
                            read, write, and delete information related to insurance awards. Such
                            unauthorized access could lead to improper insurance payments.

Poor Security Program   While a number of factors have contributed to weak federal information
                        security, such as insufficient understanding of risks, technical staff
Management Is the       shortages, and a lack of system and security architectures, the fundamental
Fundamental Cause of    underlying problem is poor security program management. We reported on
                        this problem in 1996 and, again, in 1998,8 noting that agency managers are
Poor Computer           not ensuring, on an ongoing basis, that risks are identified and addressed
Security                and that controls are operating as intended. In many cases, senior agency
                        officials have not recognized that computer-supported operations are
                        integral to carrying out their missions and that they can no longer relegate
                        the security of these operations solely to lower-level technical specialists.
                        For these reasons, it is essential that this fundamental problem be
                        addressed as part of an effective information technology management
                        strategy, which will also serve to strengthen critical infrastructure

                        Agencies have responded to scores of recommendations for improvement
                        made by us and by agency inspectors general. However, similar
                        weaknesses continue to surface because agencies have not implemented a
                        management framework for overseeing information security on an
                        agencywide and ongoing basis. Instead, there is a tendency to react to
                        individual audit findings as they are reported, with little ongoing attention
                        to the systemic causes of control weaknesses.

                        GAO/AIMD-96-110, September 24, 1996, and GAO/AIMD-98-92, September 23, 1998.

                        Page 4                                                             GAO/T-AIMD-00-7
To identify potential solutions to this problem, we studied the security
management practices of eight nonfederal organizations known for their
superior security programs. We found that these organizations managed
their information security risks through a cycle of risk management
activities.9 The basic framework−built on 16 specific practices−allows risk
management through an ongoing cycle of activities coordinated by a
central focal point. The management process involves

• assessing risk to determine information security needs;
• developing and implementing policies and controls that meet these
• promoting awareness to ensure that risks, roles, and responsibilities are
  understood; and
• instituting an ongoing program of tests and evaluations to ensure that
  policies and controls are appropriate and effective.

 Information Security Management: Learning From Leading Organizations (GAO/AIMD-
98-68, May 1998).

Page 5                                                          GAO/T-AIMD-00-7
Figure 1: The Risk Management Cycle

The guide is generally consistent with OMB and NIST guidance on
information security program management, and it has been endorsed by
the Chief Information Officers (CIO) Council as a useful resource for
agency managers.

One agency that has illustrated the value of these management practices in
strengthening computer security is the Internal Revenue Service (IRS). IRS
has made significant progress by acknowledging the seriousness of its
computer security weaknesses, consolidating overall responsibility for
computer security management, reevaluating its approach to computer
security management, and developing a high-level plan for mitigating the
identified weaknesses.10

 IRS Systems Security: Although Significant Improvements Made, Tax Processing
Operations and Data Still at Serious Risk (GAO/AIMD-99-38, December 14, 1998).

Page 6                                                              GAO/T-AIMD-00-7
A Comprehensive             While adopting the practices recommended by the guide can better prepare
                            agencies to protect their systems, detect attacks, and react to security
Strategy for                breaches, other actions are also needed to improve oversight and
Improvement Is              otherwise address the problem from a governmentwide perspective.
Needed                      Presidential Decision Directive (PDD) 63, issued in May 1998, recognized
                            that addressing computer-based risks to our nation’s critical infrastructures
                            requires an approach that involves coordination and cooperation across
                            federal agencies and among public and private-sector entities and other
                            nations. In this regard, PDD 63 established several entities to coordinate
                            infrastructure protection efforts.11 However, the details of the PDD’s
                            approach have not been finalized. As a result, a major objective of PDD
                            63 to make the federal government “a model to the private sector on how
                            best to protect critical infrastructure,” has not been realized nor is it clear
                            how this objective will be met.

                            To provide greater assurance that critical infrastructure objectives can be
                            met, we believe that actions are needed in seven key areas. I will briefly
                            discuss each of these.

Clearly Defined Roles and   First, it is important that the federal strategy delineate the roles and
Responsibilities            responsibilities of the numerous entities involved in federal information
                            security and related aspects of critical infrastructure protection. Under
                            current law, OMB is responsible for overseeing and coordinating federal
                            agency security; and the National Institute of Standards and Technology
                            (NIST), with assistance from the National Security Agency (NSA), is
                            responsible for establishing related standards.12 In addition, interagency
                            bodies, such as the CIO Council and the entities created under PDD 63 are
                            attempting to coordinate agency initiatives.

                            While these organizations have developed fundamentally sound policies
                            and guidance and have undertaken potentially useful initiatives, effective
                            improvements are not taking place. This is due, in part, to the relative

                             In May 1998, PDD 63 created several new entities in the National Security Council, the
                            Department of Commerce, and the Federal Bureau of Investigation which also have
                            responsibility for guiding and overseeing and coordinating agency security with a focus on
                            critical infrastructure protection.
                                 The Computer Security Act and the Paperwork Reduction Act.

                            Page 7                                                                   GAO/T-AIMD-00-7
                         immaturity of the recently established processes. It is also unclear how the
                         activities of these many organizations interrelate, who should be held
                         accountable for their success or failure, and whether they will effectively
                         and efficiently support national goals.

                         Constraints on resources and the urgency of the problem require that
                         government activities are designed and coordinated to achieve clearly
                         understood goals. There must also be clear linkage between policy
                         guidance, technical standards, and agency practices to ensure
                         responsibility/accountability for actual improvements.

Specific Risk-Based      Second, agencies need more specific guidance on the controls that they
Standards                need to implement. Currently agencies have wide discretion in deciding
                         (1) what computer security controls to implement and (2) the level of rigor
                         with which they enforce these controls. In theory, this is appropriate since,
                         as OMB and NIST guidance states, the level of protection that agencies
                         provide should be commensurate with the risk to agency operations and
                         assets. In essence, one set of specific controls will not be appropriate for all
                         types of systems and data.

                         However, our studies of best practices at leading organizations have shown
                         that more specific guidance is important. In particular, specific mandatory
                         standards for varying risk levels can clarify expectations for information
                         protection, including audit criteria; provide a standard framework for
                         assessing information security risk; and help ensure that shared data are
                         appropriately protected. Implementing such standards for federal agencies
                         would require developing (1) a single set of information classification
                         categories for use by all agencies to define the criticality and sensitivity of
                         the various types of information they maintain and (2) minimum mandatory
                         requirements for protecting information in each classification category.

Routine Evaluations of   Third, routine periodic audits must be implemented to allow for meaningful
Agency Performance       performance measurement. A requirement for periodic examinations of
                         controls in operation would significantly strengthen oversight
                         requirements in the Computer Security Act, which focus on evaluating
                         agency security plans, rather than practices.

                         Ensuring effective implementation of agency information security and
                         critical infrastructure protection plans will require monitoring to determine
                         if milestones are being met and testing to determine if policies and controls

                         Page 8                                                          GAO/T-AIMD-00-7
                          are operating as intended. Evaluations at several levels can be beneficial.
                          Tests initiated by agency officials are essential because they provide
                          information needed to fulfill their ongoing responsibility for managing
                          security programs. Evaluations initiated by independent auditors, such as
                          agency inspectors general, can serve as an independent check on
                          management evaluations and provide useful information for congressional
                          and executive branch oversight. Summary evaluations performed by
                          entities such as OMB, GAO, or the CIO Council can provide a
                          governmentwide view of progress and help identify crosscutting problems.

                          At present, there is no requirement for periodic independently initiated
                          tests and evaluations of agency computer security programs. As a result,
                          information for measuring the effectiveness of agency security programs,
                          and thus, holding agency managers accountable is limited. While some
                          control testing is done in support of annual independent financial
                          statement audits, ensuring routine periodic testing of all critical agency
                          systems−both financial and nonfinancial−may require new legislation.

Executive Branch and      Fourth, the executive branch and the Congress must effectively use audit
Congressional Oversight   results and performance measures to monitor agency performance and
                          take whatever action is deemed advisable to remedy identified problems.
                          Such oversight is essential to hold agencies accountable for their
                          performance and was demonstrated by the recent OMB and congressional
                          efforts to oversee the Year 2000 challenge.

Adequate Technical        Fifth, it is important for agencies to have the technical expertise they need
Expertise                 to select, implement, and maintain controls that protect their computer
                          systems. Similarly, the federal government must maximize the value of its
                          technical staff by sharing expertise and information. The Computer
                          Security Act authorized NIST to provide assistance to agencies and
                          included provisions for periodic training in computer security awareness
                          and practice. However, as the Year 2000 challenge showed, the availability
                          of adequate technical expertise has been a continuing concern to agencies.

                          A number of programs and recommendations have been proposed that
                          merit congressional study. For example, prompted in part by concerns over
                          technical staff shortages affecting Year 2000 efforts, the CIO Council’s
                          Education and Training committee studied ways to help agencies recruit
                          and retain information technology personnel. The resulting report provides
                          an extensive description of the current status of federal information

                          Page 9                                                        GAO/T-AIMD-00-7
                        technology employment, improvement efforts currently underway, and
                        detailed proposals for action.

Adequate Funding        Sixth, agencies must have resources sufficient to support their computer
                        security and infrastructure protection activities. Funding for security is
                        already embedded to some extent in agency budgets for computer system
                        development efforts and routine network and system management and
                        maintenance. However, some additional amounts are likely to be needed to
                        address specific weaknesses and new tasks. Also, addressing the Year 2000
                        challenge has resulted in postponement of many program and information
                        technology initiatives−including system enhancements and computer
                        security.13 OMB and congressional oversight of future spending on
                        computer security will be important to ensure that agencies are not using
                        the funds they receive to continue ad hoc, piece-meal security fixes not
                        supported by a strong agency risk management framework.

Incident Response and   Seventh, there is a need to more comprehensively monitor and develop
Coordination            responses to intrusions, viruses, and other incidents that threaten federal
                        systems. Several entities are already providing some central coordination
                        in this area−including the FBI, NIST, and the FedCIRC.14 However, the
                        specific roles and responsibilities of these organizations, as well as the
                        balance between governmentwide and individual agency responsibilities,
                        should be clarified and expanded to provide a more comprehensive picture
                        of the security events that are occurring and assistance in dealing with

                        Such efforts can take several forms that provide differing benefits. For
                        example, a governmentwide response center could provide immediate
                        emergency assistance to agencies experiencing intrusions or other
                        potential problems. It could also provide assistance on a nonemergency
                        basis, especially by alerting agencies to new threats and vulnerabilities and
                        helping them identify actions to prevent or mitigate incidents. By calling on
                        a center for such assistance, agencies could tap into a source of specialized

                         Year 2000 Computing Challenge: Estimated Costs, Planned Uses of Emergency Funding,
                        and Future Implications (GAO/T-AIMD-99-214, June 22, 1999).
                         FedCIRC−the Federal Computer Incident Response Capability−is a reporting center at the
                        General Services Administration.

                        Page 10                                                               GAO/T-AIMD-00-7
                   expertise that may be difficult and expensive to maintain at the individual
                   agency level. A governmentwide center could also serve as clearinghouse
                   of information on incidents that would be available to federal agencies and
                   the public. Such information can be valuable in estimating the significance
                   of different types of information security risks. For example, when the
                   Melissa virus surfaced earlier this year, we found that there was no single
                   place to obtain complete data on what agencies were hit and how they
                   were affected. Moreover, there were no data available that quantified the
                   impact of the virus in terms of productivity lost or the value of data lost.

                   Finally, it is important to recognize that, by itself, a central clearinghouse is
                   not complete solution for the information security problems across the
                   federal government. Agencies themselves must still use this information
                   effectively to assess risks to their own computer-supported operations and
                   to develop and implement sound management controls.

                   In conclusion, Mr. Chairman, I want to stress that there are no simple
                   solutions to improving computer security throughout the government.
                   What is clear is that a bottom-up approach will not work. To begin to meet
                   the lofty goal of PDD 63−making the government a model−will require
                   sustained top management support, consistent oversight, and additional
                   levels of technical and funding support. Taking steps to address the issues
                   outlined in my statement could help the government put its own house in
                   order and more effectively work with the private sector to protect critical
                   infrastructures. This concludes my testimony. I will be happy to answer any
                   questions you or Members of the Subcommittee may have.

(511065)   Leter   Page 11                                                          GAO/T-AIMD-00-7
Ordering Information

The first copy of each GAO report and testimony is free.
Additional copies are $2 each. Orders should be sent to the
following address, accompanied by a check or money order made
out to the Superintendent of Documents, when necessary, VISA and
MasterCard credit cards are accepted, also.

Orders for 100 or more copies to be mailed to a single address are
discounted 25 percent.

Orders by mail:

U.S. General Accounting Office
P.O. Box 37050
Washington, DC 20013

or visit:

Room 1100
700 4th St. NW (corner of 4th and G Sts. NW)
U.S. General Accounting Office
Washington, DC

Orders may also be placed by calling (202) 512-6000
or by using fax number (202) 512-6061, or TDD (202) 512-2537.

Each day, GAO issues a list of newly available reports and
testimony. To receive facsimile copies of the daily list or any list
from the past 30 days, please call (202) 512-6000 using a touchtone
phone. A recorded menu will provide information on how to obtain
these lists.

For information on how to access GAO reports on the INTERNET,
send an e-mail message with “info” in the body to:


or visit GAO’s World Wide Web Home Page at:

United States                       Bulk Mail
General Accounting Office      Postage & Fees Paid
Washington, D.C. 20548-0001           GAO
                                 Permit No. GI00
Official Business
Penalty for Private Use $300

Address Correction Requested