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Manchester cyber security firm wins work worth millions

Staff report
February 08. 2014 12:12AM
Management team for the Red Sky Alliance and Wapack Labs at the Waumbec Mill includes, from the left, Richard Gamache, chief information officer, Chris Hall, technical director, and Jeffery Stutzman, founder and CEO. (/Union Leader)

MANCHESTER - An international cyber security firm headquartered at the Waumbec Mill has landed two major contracts - one with the trade organization representing 4,400 financial institutions and another with a major telecommunications company.

The explosive growth of the eight-person operation at Red Sky Alliance and Wapack Labs comes amid heightened concerns about cyber security in the wake of the breaches at Target and other major retailers.

In late December, the company closed deals with the Financial Services Information Sharing and Analysis Center (FS-ISAC) and Cincinnati Bell Technology Services, effective Jan. 1.

The financial services center acts as a clearing house of information for banks and other financial institutions on cyber threats and solutions, while CBTS is the technology services division of the "Baby Bell" that serves a large swatch of the Indiana, Kentucky and Ohio.

The two contracts represent millions in potential revenue for Wapack Labs - an enterprise that just got underway last spring, when the Union Leader first featured Jeffrey Stutzman of Wilton, a former Naval Intelligence Officer with years of experience in detecting and thwarting threats in cyberspace.

With his experience in military intelligence, computer forensics and cyber threat detection, Stutzman launched the Red Sky Alliance three years ago with partner Jim McKee, a self-avowed "serial entrepreneur."

The alliance now has 35 Fortune 500 companies as members, each paying $66,000 a year for intelligence and security information sharing.

Just as hackers have online communities that share information, tools and software, organizations like Red Sky and the FS-ISAC have created networks of their own to combat the threat, with varying results.

The intelligence gathered for the Red Sky network is kept within the network, so Stutzman and his team created Wapack Labs to be able to share information about serious threats with government agencies.

While digging deep into the "dark Web" for a client, Stutzman discovered videos of a terrorist cell offering a step-by-step guide to making cyanide bombs.

"We wanted to be able to work with the FBI on that, because that's not something you just want to sit on," Stutzman said.

"So we created Wapack, which does all the analysis for the Red Sky Alliance, and will share with the government information about any significant threat."

Wapack services are billed at $300 an hour, with a minimum retainer of $180,000 a year, Stutzman said.

Exceptional service

If the Wapack pricing seems high, Stutzman says it's because the company offers something few other agencies can provide - genuine "human intelligence" gathered from shoe-leather investigations, not just deep dives into the Internet.

The key partners each have 20 years or more of experience in the intelligence community, with military organizations, private firms, or both.

On New Year's Eve, the night before the contract with the financial services collaborative was about to take effect, Wapack learned of a major breach that was about to take place affecting some of the largest banks in the Hong Kong area.

"We warned of a pending attack on Honk Kong banks and we were dead on," Stutzman said.

"We had very specific information from some of our sources that this was going to happen."

'Gold doesn't float'

While Stutzman's organization has technical analysts skilled in malware coding and cyberthreat analysis from an online perspective, the key to his business are the contacts and sources he and his closest associates have built up over the years.

"We all have our own rolodexes of people we can call on. Our business is centered around connecting with people and talking to people, more than aggregating data," he said.

"So it's a very unique perspective on the threats. We don't get any access to government data in what we do. The good stuff comes from open sources anyway, knowing the people and knowing who to ask."

Stutzman said good intelligence on pending cyber threats is like gold. "And gold doesn't float," he said. "You have to dig for it."

Languages spoken from the Wapack office include Mandarin, Serbo-Croatian, French, Romanian, Japanese, Portugese and Austrian.

The fluency in Mandarin came in handy when the team discovered a video in the Chinese language posted by a University of Toronto student who had successfully hacked into an ATM, and took a video of himself "to earn street cred," as Stutzman put it.

As with any crime, the cyber criminal is often his own worst enemy.

"They like to brag; they like to show their wares, just like regular criminals," he said.

"Even the worst of the worst will talk about it, to a friend, in a blog entry, or something else," he said.

The Red Sky network is growing quickly in the wake of attacks on Target, Neiman-Marcus and Michaels stores, said Richard Gamache, chief information officer.

Wapack issued its own report on the Target breach, which apparently was shared by some Red Sky members.

"After our initial report on the Target breach hit the closed community at Red Sky, our phones started ringing off the hook," he said.

The company appears to be well-poised to take advantage of a demand for cyber security that grows stronger by the day. "Timing is everything," Stutzman said.

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