Despite the danger posed by Islamic State and other extremist groups, the nation's top intelligence official warned Thursday that sophisticated cyberattacks like the recent hack of Sony Pictures posed a greater threat to the United States.
The threat comes not just from foreign spies and hackers trying to steal trade secrets, but from government-backed intrusions that siphon vast wealth and valuable data from U.S. computer systems.
"Although we must be prepared for a catastrophic large-scale strike, a so-called cyber Armageddon, the reality is that we've been living with a constant and expanding barrage of cyberattacks for some time," James R. Clapper, director of national intelligence, told the Senate Armed Services Committee in a hearing on worldwide threats.
Clapper said Russia was playing a growing role, warning that the threat from hackers working for the Russian government "is more severe than we have previously assessed," though he declined to provide details in public. The governments of China, North Korea and Iran also have infiltrated U.S. digital networks, he said.
For the first time last year, foreign governments launched cyberattacks designed to obliterate U.S. computer data, Clapper said.
Last February, hackers erased hard drives and froze servers running slot machines and loyalty rewards programs at Las Vegas Sands Corp. casinos in Las Vegas. Clapper confirmed Thursday that Iran was behind the hacking operation.
Security experts theorize that Sands was targeted because the casino company's owner, conservative billionaire Sheldon Adelson, had said in 2013 that a "mushroom cloud" could rise over Tehran if it continued its nuclear development program.
Clapper described North Korea's digital assault on Sony Pictures as "the most serious and costly cyberattack against U.S. interests to date."
In November, hackers infiltrated the company's servers to wipe clean computers and release sensitive data, including Social Security numbers, embarrassing emails and the salaries of top executives. The FBI said the North Korean government wanted to prevent the studio from releasing "The Interview," a film that mocked leader Kim Jong Un. Sony has spent at least $15 million to repair the damage.
Under pressure to improve the government response, President Obama ordered the creation of an agency to analyze threat data collected by the National Security Agency, the Pentagon, the Homeland Security Department, the FBI and other government entities, as well as private industry. The new Cyber Threat Intelligence Integration Center, as it is called, will report to Clapper.
In response to questions, Clapper acknowledged that the U.S. also had built "offensive capabilities" to sabotage adversaries' computer networks. But he said officials were still trying to develop doctrine for when, and how aggressively, the government should launch digital counterattacks.
"That is an issue that, at the policy level, we're still, frankly, wrestling with," Clapper said.
Clapper also warned of the growing flow of foreigners joining Islamic State and other militant groups in Iraq and Syria. While most are from Muslim countries, about 3,400 hold Western passports. He said about 180 Americans had gone or tried to go to the war zones, up from about 100 a year ago.
The FBI arrested three men Wednesday in New York and Florida, who were charged with trying to join or aid Islamic State. Two were from Uzbekistan and the other from Kazakhstan.
A "relatively small number" of Americans have returned home from Syria, Clapper said. They are being tracked and "we have not identified any attack plotting," he said.
Sen. John McCain (R-Ariz.), chairman of the committee, pressed Clapper to do more to counter Russia's military push in Ukraine and along the Black Sea.
Clapper seemed split on whether the White House should supply lethal arms to Ukrainian forces fighting Russia-backed separatists.
"I would favor it, but that's a personal perspective," Clapper said. He acknowledged that the move might backfire by drawing Russia deeper into the conflict and could lead to more sophisticated weapons in rebel-held areas.
Lt. Gen. Vincent Stewart, head of the Defense Intelligence Agency, the Pentagon's chief spy agency, told the committee that sending U.S. weapons would not resolve the crisis in Ukraine.
"We couldn't deliver lethal aid sufficiently [or] quickly enough to change the military balance of power on the ground," Stewart said.
He said Russia and the separatists could easily resupply themselves with heavy weapons and ammunition if the war worsened. "So it would be a race to see who could arm, and I think … they would have a significant advantage on the ground."