Hillicon Valley: Chinese firm asks feds to lift business ban | North Korean hackers grow more brazen | Panel advances DHS cyber pick | Dems want scrutiny of T-Mobile, Sprint merger

View in Browser     Welcome to Hillicon Valley, The Hill's comprehensive newsletter with all you need to know about tech and cybersecurity from Capitol Hill to Silicon Valley.   Follow the tech team, Ali Breland (@alibreland) and Harper Neidig (@hneidig), and the cyber team, Morgan Chalfant (@mchalfant16) and Olivia Beavers (@olivia_beavers), on Twitter. Scoops/Tips/Comments/Compliments? Please reach out to us.   ZTE'S BIG ASK: Chinese phone maker ZTE is asking the Commerce Department to suspend its ban on doing business with American companies. ZTE revealed the request in a financial disclosure. Commerce, last month, decided to impose a seven-year ban on American companies selling equipment and software to ZTE, after finding that it violated sanctions rules by conspiring to sell equipment to Iran. ZTE is very reliant on its business dealings with U.S. firms and the ban would dramatically damage its business, according to analysts. The push is coming from the highest levels: During ongoing negotiations in Beijing last week, China reportedly tried to appeal to U.S. officials to soften the ban on ZTE selling products in the U.S. The country, understandably, wants to protect its No. 2 phone maker from being hurt by American regulators. The bigger picture: Though Commerce has said its actions are based on ZTE violating sanctions, it comes amid a larger wave of action from the U.S. government against Chinese technology firms. The White House and Congress are both targeting Chinese tech companies, citing national security concerns. Commerce and the Department of Justice's actions against ZTE were attributed to it violating sanctions with Iran, but China has dismissed those concerns. Silicon Valley's big worry: American firms are afraid of being caught in the crosshairs of a U.S.-China trade fight. "Tariffs and any Chinese retaliation that could follow would hurt American consumers, businesses and workers, and not level the playing field with China," said Ashley Berrang, a spokeswoman for the Information Technology Industry Council, a tech industry trade group. "China could come up with a bogus antitrust concern and go after U.S. firms. They can do whatever they want. There's no barrier to stop them," added Rob Atkinson, the president of the Information Technology and Innovation Foundation, a Washington, D.C.-based think tank. American tech companies worry that China could easily implement the same tactics used by the U.S. government: stopping mergers between Chinese and U.S. companies, constraining investments in foreign companies and barring foreign businesses from obtaining federal contracts. "The risk of divestiture of orders, limits on market access -- all those tools are available to the Chinese government that has been historically more hands-on than the U.S." explained Tony Balloon, head of the corporate China practice at the law firm Alston & Bird.   HACKING ALERT: NORTH KOREA GROWING MORE BRAZEN IN CYBERSPACE: North Korea's army of hackers has grown more brazen and capable over the course of several months, broadcasting a growing willingness to launch attacks on international targets. Hackers linked to Pyongyang have deployed new tools and escalated operations against financial targets and global organizations. Over the past two years, security professionals have observed a continuous improvement in North Korea's technical capabilities. North Korea's cyber capabilities are still considered inferior to those in other nations, like Russia, China and Israel. But some say North Korea's evolution on cyber -- coupled with the country's willingness to execute attacks when motivated by geopolitical events -- make Pyongyang one of the more threatening adversaries in cyberspace. "They have demonstrated that when they have the intention they will deploy the capability," said Adam Meyers, vice president of intelligence at CrowdStrike. "I would say that it is a formidable cyber adversary for us." The latest evidence: Late last month, researchers at cybersecurity firm McAfee revealed that a hacking campaign they had been tracking had widened to critical infrastructure, financial and telecommunications targets in 17 different countries. The bigger picture: North Korea's increased hacking activity comes against the backdrop of an anticipated historic summit between President Trump and North Korean leader Kim Jong Un that offers the prospect of North Korean denuclearization. The result of that meeting -- whether good or bad -- is likely to have an impact on North Korea's activity in cyberspace against the U.S. going forward. To read more, click here.   DEMS URGE ETHICS PROBE OF FCC COMMISSIONERS AT CPAC: Reps. Frank Pallone Jr. (D-N.J.) and Mike Doyle (D-Pa.) want the Office of Special Counsel (no relation to the Robert Mueller task force) to investigate whether three Republican FCC commissioners violated the Hatch Act by appearing at CPAC in February. The call for more scrutiny comes days after the OSC revealed that it had given one of the commissioners, Mike O'Rielly, a slap on the wrist for violating the ethics law during a CPAC panel discussion during which he called on voters to re-elect President Trump. "In addition to your finding last week that Commissioner Michael O'Rielly did in fact violate the Hatch Act during his appearance at CPAC, the three Republican FCC Commissioners have also refused to cooperate with Congressional oversight into their promotion of and participation in CPAC," the two Democrats wrote to OSC on Monday. "These actions raise serious concerns about whether the Chairman and Commissioners may have knowingly violated ethical restrictions. We hope you will assist us in this investigation," they added. An FCC spokesperson fired back: "The FCC's career ethics officials determined that it was permissible for the three Republican Commissioners to speak at CPAC. Indeed, Cabinet members also spoke at CPAC, and the Democrats' letter contains no explanation for why the Commissioners' participation should be treated any differently. Sadly, we are left to conclude that the Democrats are simply trying to stop FCC Commissioners from speaking to right-of-center organizations while they have no problem with Commissioners speaking to left-of-center groups." Flashback: Recall that FCC Chairman Ajit Pai declined a courage award presented to him at CPAC on the advice of ethics officials at the agency. To read more, click here.   SESSIONS SAYS CONGRESS MAY NEED TO ACT ON ENCRYPTION: Attorney General Jeff Sessions indicated in a Monday speech that Congress may ultimately have to wade into the debate about federal law enforcement agencies unlocking encrypted devices that are tied to ongoing investigations. Sessions, in a speech to a group of state law enforcement agencies, said the issue is "critical" because the bureau was unable to access thousands of devices related to their work of protecting the public. "Last year, the FBI was unable to access investigation-related content on more than 7,700 devices -- even though they had the legal authority to do so. Each of those devices was tied to a threat to the American people," Sessions said. "That's why we are working with stakeholders in the private sector, in law enforcement and in Congress to find a solution to this problem. Ultimately, we may need Congress to take action on this issue," he continued. To read more of our piece, click here.   WHITE HOUSE HUSTLES FOR HASPEL: The White House is ramping up an eleventh-hour effort to build support for President Trump's pick to lead the CIA, just days before she is scheduled to face a grilling from the Senate Intelligence Committee over her role in the agency's controversial detention and interrogation program. For weeks, the CIA has led the charge on promoting now-acting Director Gina Haspel -- a forward-leaning public relations campaign that some critics have said is inappropriate for the clandestine agency. Only late last week did the White House stand up the kind of broad-based press campaign typical of other high-stakes nominations, issuing a swath of laudatory press releases and briefing reporters. On Monday, the CIA has given Congress a tranche of classified documents related to the controversial undercover background of Gina Haspel, President Trump's choice to lead the spy agency. The delivery -- a single cardboard box marked "hand carry" that was wheeled in on a dolly to a secure facility in the Capitol basement -- comes as the agency is under fierce pressure from Democrats to declassify more information about Haspel's involvement in its now-defunct detention and interrogation program. To read more of our coverage, click here and here.   A LIGHTER TWITTER CLICK: When the box carrying classified CIA Haspel documents says 'HAND CARRY' on it... (Tweet)   MORE RUSSIA ADS: Democrats on the House Intelligence Committee are gearing up to publicly release a trove of Facebook ads linked to Russia. "We have been in ongoing discussions with Facebook and hope to have the final redacted ads in our possession within a matter of days. As soon as we receive them, it is our intention to share them with the public," Rep. Adam Schiff (D-Calif.), ranking member on the committee, said in a statement to The Hill on Sunday. The release follows an initial batch that they first put out when lawyers from Facebook, Twitter and Google testified before the committee in November. Read more here.   DEFENSE BILL DEETS: The chairman of the House Armed Services Committee is proposing that Congress mandate that the National Security Council coordinate the government's effort to counter "malign foreign influence." The provision is included in Chairman Mac Thornberry's (R-Texas) mark of the fiscal 2019 defense policy bill known as the National Defense Authorization Act (NDAA), released on Monday. While the document does not specifically mention Russian interference in the 2016 presidential election, the provision appears to be a direct response to Moscow's influence effort. The proposal would direct President Trump to designate a member of the National Security Council to coordinate the interagency effort against malign foreign influence. Trump would also be required to submit to Congress a strategy for countering malign foreign influence within nine months of the bill's enactment. The proposed legislation would specifically define malign foreign influence operations and campaigns as "the coordinated, integrated, and synchronized application of national diplomatic, informational, military, economic, business, corruption, educational, and other capabilities by hostile foreign powers to foster attitudes, behaviors, decisions, or outcomes within the United States." To read more click here.   A NOMINATION ALERT: President Trump's choice to lead the Department of Homeland Security's (DHS) cybersecurity and critical infrastructure protection efforts advanced a key Senate panel on Monday. Senators on the Homeland Security and Governmental Affairs Committee approved Christopher Krebs's nomination on Monday by a voice vote, according to a committee aide. His nomination will now go before the full Senate. If confirmed, Krebs will manage a growing portfolio of responsibilities, which now includes protecting digital election systems from cyberattacks. More on his nomination here.   FROM THE ROSE GARDEN: Melania Trump is stepping more fully into the spotlight as first lady, revealing Monday a new platform for tackling multiple issues relevant to American children. One of those issues will be social media use, in addition to well-being and opioid abuse. The first lady in the past has pointed to cyber bullying as an issue she wants to focus on. "I am very excited to announce Be Best, an awareness campaign dedicated to the most valuable and fragile among us -- our children," Trump said Monday. "There is one goal to Be Best -- and that is to educate children about the many issues they are facing today."   SENATE DEMS URGE SCRUTINY OF T-MOBILE-SPRINT DEAL: Sen. Amy Klobuchar (D-Minn.) led a group of senators on Monday in calling on the Justice Department and FCC to closely scrutinize the T-Mobile-Sprint merger, warning that it could have harmful effects on consumers. "As more than three-quarters of American adults now own smartphones, including many who depend on these devices for their primary connection to the internet, an anticompetitive acquisition in the wireless market could result in higher prices for American consumers or force some people to forego their internet connection altogether," the senators wrote in a letter to the two regulators. To read more, click here.   ON TAP FOR TOMORROW: The House Science Committee is holding a hearing on blockchain technology at 10 a.m. featuring representatives from the private sector as well as the head of the Department of Homeland Security's cybersecurity research division. The Entertainment Software Association will host its 'Games for Impact' on Capitol Hill in the Rayburn House Office Building Cafeteria from 5:30 p.m. to 8:00 p.m.   ON DEADLINE: Don't forget that Nathan Deal, Georgia's Republican governor, faces a deadline tomorrow to sign or veto a controversial piece of legislation that would potentially clear the way for private companies to hack into other networks for the sake of their own cybersecurity. Read more here.   LONGREAD OF THE DAY: Ben Tarnoff and Moira Weigel in The Guardian discuss why they think that tech's promises to "do better" will likely fall short.   TECH TIDBITS: A new report from the Anti-Defamation League (ADL) found that millions of anti-Semitic messages have been shared on Twitter in recent months.  Google announced on Monday that it would no longer allow bail bond companies to buy advertisements on its ad platforms. Uber is hiring a former chairman of the National Transportation Safety Board (NTSB) to advise on safety following a car crash in Arizona that killed a pedestrian.   NOTABLE LINKS FROM AROUND THE WEB: A federal judge in D.C. denied Special Counsel Mueller's request for a delay in the Internet Research Agency case. (Politico) Two hackers have been extradited from Romania to face a slew of federal charges. (The New York Times) Facebook's 'suggested friends' feature is attracting scrutiny. (The Telegraph) The New York Times Magazine does a deep dive into the Bangladesh Bank cyber heist. The Guardian breaks down how Cambridge Analytica's psychological influence tools were supposed to work based on a conversation with whistleblower Christopher Wylie. Facebook tweaked its algorithms and a month in the result is boosting conservative websites. The New Yorker's Jia Tolentino does a deep dive into the vaping trend that's sweeping teens across the country.           Did a friend forward you this email? Sign up for Technology Newsletters     Forward Technology Newsletters       Privacy Policy  |  Manage Subscriptions  |  Unsubscribe  |  Email to a friend  |  Sign Up for Other Newsletters   The Hill 1625 K Street, NW 9th Floor, Washington DC 20006 ©2016 Capitol Hill Publishing Corp., a subsidiary of News Communications, Inc.

Overnight Energy: Interior sending officers to southern border | Dem AGs want EPA to halt plan restricting use of science | EPA documents show secrecy push

View in your browser     INTERIOR TO SEND OFFICERS TO HELP BORDER PATROL: The Interior Department is sending its law enforcement officers to help the Department of Homeland Security secure the U.S.– Mexico border, according to an internal email obtained by The Hill. The announcement from the U.S. Park Police (USPP) Planning Unit and National Park Service (NPS), sent last Thursday, says that officers from both agencies will assist the Border Patrol along the southwest border starting May 13 as part of "Secretary [Ryan] Zinke's offer of assistance to the Department of Homeland Security." USPP officers are traditionally tasked with policing NPS property around Washington, D.C., New York and San Francisco. The details: According to the guidance, officers will be sent in rotating groups and spend "approximately 21 days" at two national park and monument sites located on the U.S.–Mexico border: Organ Pipe Cactus National Monument in Arizona and Amistad National Recreation Area in Texas.   Who is going?: Interior will "most likely" be first sending in officers that are part of the department's two emergency management units -- the NPS Special Event Tactical Team (SETT) and USPP Emergency Support Functions (ESF)-13, the guidance said. Read more here.     DEMS PUSH PRUITT TO HIT BRAKES ON SCIENCE PLAN: Eight Democratic attorneys general are pushing Environmental Protection Agency (EPA) head Scott Pruitt to stop his proposal to restrict the science the agency could use in writing and enforcing regulations. The group, led by New York Attorney General Eric Schneiderman (D), hinted that they might sue the EPA if it moves forward with the rule that they and other critics say is an attempt to stop the EPA from using some major findings on health, pollution and other issues. "In light of the far-reaching impact the proposal could have on EPA's mission to protect public health and the environment, we ask that you withdraw the proposed rule and convene a process to first consult with the National Academy of Sciences and other independent scientists and science organizations before deciding whether any proposed changes to EPA's current use of scientific evidence are in order," they wrote. Background: The proposal released last month sought to improve transparency in scientific decisionmaking and stop the use of "secret science." Scientific findings and data used by the EPA would have to be reproducible and completely available to anyone wishing to scrutinize it. Read more here.   EPA DOCS SHINE LIGHT ON SECRECY PUSH: New internal EPA documents are shedding light on the agency's attempts to keep Administrator Scott Pruitt's activities secret, especially before they take place. The documents, first reported on Monday by The New York Times and obtained through a Freedom of Information Act lawsuit by the Sierra Club, also show that EPA staff often frame potential reporters or attendees at events as either "friendly" or "unfriendly." In one example, in planning an Iowa event on Pruitt's work to roll back an Obama administration water pollution rule, a cattle farmer helping to organize the event told the EPA that he was planning it as a "town hall meeting," which would allow attendees to ask questions. "With a crowd of 300 people plus open press, we have to stick with the questions we currently have," Pruitt's scheduling director, Millan Hupp, replied, the documents show. "My sincere apologies for causing any difficulty but we cannot do open q&a from the crowd." Read more here. Pruitt's former chief bodyguard pushes back: The former head of Pruitt's security detail is pushing back on reports that he was responsible for the escalation in security spending for the EPA head. Pasquale "Nino" Perrotta, who retired last week, told the Daily Caller News Foundation that his alleged role is a "false narrative," like many in recent weeks surrounding Pruitt. "I believe at the end of the day these are disgruntled employees, staffers who for whatever reason decided to air false, dirty laundry to the press and it received some traction," Perrotta said of the news. "But as time will go forward and information is uncovered on the various allegations, people will realize they were falsified and intentionally used to mislead the American people." "These people just wanted to create a false narrative," he said. Perrotta has been accused of pushing agency officials to let Pruitt buy first-class tickets on the taxpayers' dime, get Pruitt a new SUV, hire a private Italian security firm for $30,000 and other steps in the name of security. The agency has defended the unprecedented security by pointing to what they say have been unprecedented threats directed toward the EPA head.   SHIMKUS EXPECTS EASY HOUSE PASSAGE OF YUCCA BILL: Rep. John Shimkus (R-Ill.) expects that the House will vote this week to easily pass his bill aimed at getting the Yucca Mountain nuclear waste site built. The bill passed the House Energy and Commerce Committee by a vote of 49 to 4 last year, and Shimkus, who chairs the panel's subcommittee on environment, thinks a similar margin will pass the bill later this week on the House floor. "I think people are ready to do something, rather than nothing," he told reporters Monday. "I'm expecting a pretty good vote. The bill would take numerous steps to move along the Yucca process that Congress first called for in 1987. It would establish a new office at the Energy Department to shepherd the process, make utility ratepayer fees go straight to a fund to pay for it, complete a land transfer from the Department of Defense and authorize interim facilities to temporarily store waste while it is being built. The project has long faced opposition from Nevada leaders. Reps. Jacky Rosen (D-Nev.) and Ruben Kihuen (D-Nev.) both plan to introduced amendments meant to stop the project. What about the Senate? But Shimkus is less sure about the Senate. Sen. Dean Heller (R-Nev.) is up for reelection this year, and Senate leaders are unlikely to force him to vote on the project he opposes. "I think they're going to be excited about a big, bipartisan bill that comes through," Shimkus said sarcastically when asked about what the Senate will do when the House sends the legislation to the upper chamber.   OUTSIDE THE BELTWAY: The New York Times reports on the battle between Patagonia and the Trump administration. New York Gov. Andrew Cuomo (D) is willing to go all out in his fight against offshore oil and natural gas drilling, including leading a "citizen fleet," the New York Post reports. Greens are warning that a proposed merger of two major United Kingdom grocery chains would be destructive to the environment, the Guardian reports.   IN CASE YOU MISSED IT: Check out stories from Monday and over the weekend. -Interior sending officers to assist patrolling the US, Mexico border -Dem AGs ask Pruitt to halt 'transparency' proposal to restrict EPA science -Documents show EPA secrecy push under Pruitt -Pruitt aides' scrutiny of public records requests slowing releases: report -Upheaval at Pruitt's EPA as departures mount     Please send tips and comments to Timothy Cama, tcama@thehill.com; and Miranda Green, mgreen@thehill.com. Follow us on Twitter: @Timothy_Cama, @mirandacgreen, @thehill         Did a friend forward you this email? 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Overnight Health Care: Trump officials reject Medicaid lifetime limits in Kansas | Walmart to restrict opioid prescriptions | Maryland insurers seeking double-digit premium hikes

Welcome to Overnight Health Care! Monday is almost over, Congress is back in session, more insurance rate hikes were announced, and CMS kept us busy today with Medicaid news. We'll start in Kansas, where the Trump administration showed there is such a thing as too much flexibility in Medicaid requirements.   Medicaid lifetime limits a bridge too far The Trump administration on Monday rejected Kansas's request to impose a three-year lifetime limit on Medicaid benefits. Why it matters: The Trump administration is drawing a line in the sand, saying that while work requirements in Medicaid are permissible, the extra conservative step of time limits on coverage is not. CMS Administrator Seema Verma explained her reasoning by saying the distinction is that people might need Medicaid again down the road, something that could be banned under a lifetime limit. "We seek to create a pathway out of poverty, but we also understand that people's circumstances change, and we must ensure that our programs are sustainable and available to them when they need and qualify for them," Verma said. Read more here.   But it's full speed ahead for work requirements New Hampshire on Monday became the fourth state to gain approval to impose work requirements as a requirement of Medicaid coverage. Under the newly approved plan, adults aged 19-64 will have to participate in 100 hours a month of "community engagement requirements," such as employment, education, job skills training or community service. If people don't meet the requirements, they will have their benefits suspended. Other states: Work requirements in Indiana, Arkansas and Kentucky have already been approved, and there are now seven states with pending applications, after Ohio submitted an application last week. The administration has yet to approve work requirements for states that have not expanded Medicaid. Read more here.   Premium hikes putting ObamaCare back in the spotlight The newest round of insurance rate requests has Democrats on the offensive. Insurers in Maryland and Virginia have submitted their initial requests for premiums in the 2019 individual marketplace. And for the most part, they are pretty steep. Virginia: Two plans will see double-digit hikes. Cigna is proposing an average premium increase of 15 percent, and Group Hospitalization and Medical Services, operating as CareFirst BlueCross BlueShield, is asking for an average increase of 64.3 percent.   Read more on Virginia here. Maryland: CareFirst BlueCross BlueShield, which is the largest insurer in the Mid-Atlantic, has asked state regulators for an average 26.4 percent increase. But if you're in a PPO, you could see a 91.4 percent increase. Kaiser Permanente requested a 37.4 percent increase on its HMO plans. The average rate increase was 30 percent. Why the big spike? The risk pool is getting increasingly older and sicker. Maryland Insurance Commissioner Al Redmer said the state's market is in a "death spiral." Premiums are rising because people are sicker, but the higher the premiums rise, the more the healthy people will drop coverage. And the Trump factor? The Trump administration is not helping, and many insurers cite policies promoted by the administration that help make the coverage pool more old and sick. The repeal of the individual mandate penalty, plus making it easier for insurers to sell cheap skimpy plans, all will contribute to removing the healthy people from the marketplace. Read more on Maryland here.   Opioids update Walmart and Sam's Club pharmacies will soon limit the supply of first-time opioid prescriptions for acute pain to seven days. They're not the first to enact such a restriction. The effort comes as an increasing number of states and entities in the health care industry have placed limits on similar prescriptions. The opposition: The American Medical Association isn't a fan of such restrictions. The powerful group of physicians has argued that the limits are arbitrary and also impede a doctor's ability to individualize care for each patient. On the other hand: Supporters of the proposals have countered that such limits are important to stem overprescribing, lower the volume of painkillers available to be illegally diverted and decrease the potential for addiction. Read more here.   Up tomorrow: Pharmaceutical distributors in the hot seat. They'll be testifying before a House Energy and Commerce subcommittee in a hearing billed as examining concerns about opioid distribution and diversion. Background: Cities, counties, tribes and other health care stakeholders have filed hundreds of lawsuits against manufacturers and distributors. They allege the companies didn't report suspicious quantities of opioids, and investigations have uncovered instances where millions of pills have gone to towns with very small populations. In statements, the Healthcare Distribution Alliance has pushed back: "Given our role, the idea that distributors are responsible for the number of opioid prescriptions written defies common sense and lacks understanding of how the pharmaceutical supply chain actually works and is regulated. Those bringing lawsuits would be better served addressing the root causes, rather than trying to redirect blame through litigation."   What we're reading Trump calls on Congress to pull back $15 billion in spending, including on Children's Health Insurance Program. (The Washington Post) Drug plans drop after Trump official targets pharmacy-benefit managers ahead of speech (Bloomberg) Just who gets those big drug rebates? (CNNMoney)   State by state   Gubernatorial hopefuls look to health care for election edge (California Healthline) Many states don't restrict pot possession by childcare workers (Reuters) Hepatitis C cure eludes patients as states struggle with costs (NBC News)     Send tips and comments to Jessie Hellmann, jhellmann@thehill.com; Peter Sullivan, psullivan@thehill.com; Rachel Roubein, rroubein@thehill.com; and Nathaniel Weixel, nweixel@thehill.com. Follow us on Twitter: @thehill, @jessiehellmann, @PeterSullivan4, @rachel_roubein, and @NateWeixel.         Did a friend forward you this email? Sign up for Healthcare Newsletters     Forward Healthcare Newsletters       Privacy Policy  |  Manage Subscriptions  |  Unsubscribe  |  Email to a friend  |  Sign Up for Other Newsletters   The Hill 1625 K Street, NW 9th Floor, Washington DC 20006 ©2016 Capitol Hill Publishing Corp., a subsidiary of News Communications, Inc.