Latest cybersecurity reporting from selected sources.

Also: Oracle Suit Points to AI Revenue Forecasting Risk; the AI Sovereignty PushIn this week's panel, four editors discussed the growing role of artificial intelligence in U.S. federal government cybersecurity, Oracle's investor lawsuit over its projected cloud sales to frontier AI lab OpenAI and what AI sovereignty means for enterprises.

New York-Based Kyndryl Can't Buy Amsterdam-Based Solvinity GroupThe growing push for European technological sovereignty from the United States claimed a significant scalp in the Netherlands, where authorities blocked the American takeover of a crucial secure cloud company.

Hijacking DNS Settings Helps Russian Hackers Decrypt TLS Traffic, Microsoft WarnsHackers tied to Russia's GRU military intelligence agency are compromising SOHO routers to hijack their DNS settings and spy on the cloud activities of high-value government, IT, telecommunications and energy organizations, Microsoft warns.

Cloud Giant Blames DNS MisconfigurationAmazon Web Services is recovering from a service outage that affected its own services and dozens of its clients on Monday including websites of the British government. The cloud computing giant - the world's largest - blamed a domain name system misconfiguration.

Cloud Giant Blames DNS MisconfigurationAmazon Web Services is recovering from a service outage that impacted its own services and dozens of its clients on Monday including websites of the British government. The cloud computing giant - the world's largest - blamed a domain name system misconfiguration.

Also: the UK's $7B Bitcoin Case, Implications of Vectra's NetographyIn this week's update, ISMG editors examine how the U.S. shutdown and the lapse of CISA 2015 liability shield are straining cyber operations, what Vectra’s move for Netography signals for multi-cloud visibility and NDR, and how British prosecutors unraveled a bitcoin hoard now worth $7 billion.

Defense Department Suspends, Reviews Microsoft 'Digital Escorts' ProgramThe Pentagon is reviewing Microsoft's decade-long use of "digital escorts" - U.S.-based staff who review code from Chinese engineers - into military cloud systems, a workaround now deemed a "breach of trust" that may have exposed sensitive but unclassified government data.

Department of Government Efficiency Staffers Created 'Live Replica' of SSA DataThe Social Security Administration's chief data officer is warning in a whistleblower complaint that DOGE created a cloud replica of the Social Security database without proper authorization or oversight, potentially exposing the personal data of 300 million Americans.

Apple, US Took Hard Line Against British DemandThe U.K. government is reportedly set to reverse course on requiring smartphone giant Apple to give police access to device data stored as backups in the California company's cloud service. "The Home Office is basically going to have to back down," a British official said.

China's Hack-For-Hire Scene Disgorges Another LeakThe Chinese nation-state threat actor tracked as Salt Typhoon is operated by a clutch of private firms whose clients include multiple Chinese government agencies, finds analysis of leaked data by Spy Cloud. Researchers found a spreadsheet listing buyers, sellers and financial transaction details.

Secret Order Seeks to Compel Apple to Weaken Encryption, Washington Post ReportsThe British government has unexpectedly reignited the long-running encryption debate, reportedly issuing a secret order to Apple requiring that it provide direct access to global users' fully encrypted cloud backups and prohibited the technology giant from alerting any targeted accountholders.

Also: Hackers Target Apple Password Reset FlawThis week, Russian organizations are losing Microsoft Cloud, hackers targeted an Apple flaw, Germany warned of critical flaws in Microsoft Exchange, an info stealer targeted Indian government agencies and the energy sector, and Finland confirmed APT31's role in a 2020 breach of Parliament.

Rule Is a Bid to Deter Malicious Foreign Use of US IaaS ProvidersCloud providers told the government they aren't very happy about a proposed regulation requiring them to verify the identity of foreign customers, but their complaints are unlikely to stop the U.S. Department of Commerce from proceeding with the rule.