A federal judge issued an order on Saturday (Feb 9) requiring Elon Musk’s team to temporarily halt its activities involving the Treasury Department’s payment systems. But this has not quelled fears that Musk's Department of Government Efficiency might be creating a significant cyber and national security risk.

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Also read: Musk claims US Treasury annually pays $100 billion to unidentified individuals

'Treasury’s systems more vulnerable than before to hacking'

In his ruling, Judge Paul A. Engelmayer stressed that Musk’s cost-cutting initiative within the government posed a serious risk of “the disclosure of sensitive and confidential information” and had made the Treasury’s systems “more vulnerable than before to hacking.”

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Cybersecurity experts raise alarm

For the past ten days, cybersecurity experts have been raising alarms as Musk’s team of young coders sought access to the Treasury’s most restricted systems. Scott Bessent, the newly appointed Treasury secretary, eventually approved this access.

According to a Washington Post report, a subcontractor working for Booz Allen Hamilton, the firm responsible for much of the Treasury’s threat detection operations, had issued a formal warning about the risks. This warning was later withdrawn after its details were leaked.

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Also read: Judge blocks Musk's DOGE from accessing US Treasury Department's sensitive personal data

Cybersecurity specialists have warned of the potential consequences of allowing outsiders into such a tightly controlled system. Possible risks include personal data breaches, unauthorised redirection of payments, and the misuse of information by political opponents.

Bruce Schneier, a cybersecurity expert from Harvard, described Musk’s intervention as “the most consequential security breach” in American history. Speaking to The New York Times, Schneier said that the breach did not result from “a sophisticated cyberattack or an act of foreign espionage, but through official orders by a billionaire with a poorly defined government role.”

James Goldgeier and Elizabeth N. Saunders, writing in Foreign Affairs on Friday, pointed out the Treasury Department’s crucial role in US foreign policy, particularly in enforcing sanctions. They said that the main targets of these sanctions—China, Russia, Iran, and North Korea—are also America's primary cyber adversaries.

Also read: US Treasury Department Claims Chinese Hack; Beijing Rejects Allegations Of Sponsoring Cyber Attacks

“If Musk’s team has access to and can rewrite the code directing US government payments, the cybersecurity and privacy risks would be massive. Hostile intelligence services are likely already at work trying to assess which Musk team members might be sloppy with their digital devices or vulnerable to entrapment or coercion,” they wrote.

The government has insisted that Musk’s team has only been permitted to review “read-only” data within the Treasury Department’s systems.

Previous cyberattacks on US Treasury 

In December, the Treasury Department disclosed in a letter to Congress that a Chinese intelligence group had infiltrated its systems and stolen unclassified data. While the full extent of the damage has not been revealed, the incident shows that the agency is a prime target for Beijing.

Also read: Musk team has 'read-only' access to payments data, says US Treasury department

During the Obama administration, Chinese intelligence operatives breached the Office of Personnel Management’s database, accessing security clearance records for over 20 million Americans. US officials believe that Chinese agents have since merged this data with stolen records from Starwood hotels and Anthem health systems to map officials’ movements and associations.

(With inputs from agencies)