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I wouldn't snicker so fast - considering we don't have the comments in full context, I'm sure that line was out of context. If you look at the location and other activity that went on, the amount of control over internet access in China, one could easily make an educated guess about the other side and who exactly is doing it (and it wasn't some bored Chinese peasant). Paller was probably flirting with a questioning from the FBI.

As far as security - I see lapses all the time - too many companies want their people to have mobile access, and any network stops being secure the moment there is access available from outside the building(s).

The only good thing - most lax security is exploited for financial gain - i.e. spammers and the like.