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Signed Malware

Stuxnet famously used legitimate digital certificates to sign its malware. A research paper from last year found that the practice is much more common than previously thought.

Now, researchers have presented proof that digitally signed malware is much more common than previously believed. What’s more, it predated Stuxnet, with the first known instance occurring in 2003. The researchers said they found 189 malware samples bearing valid digital signatures that were created using compromised certificates issued by recognized certificate authorities and used to sign legitimate software. In total, 109 of those abused certificates remain valid. The researchers, who presented their findings Wednesday at the ACM Conference on Computer and Communications Security, found another 136 malware samples signed by legitimate CA-issued certificates, although the signatures were malformed.

The results are significant because digitally signed software is often able to bypass User Account Control and other Windows measures designed to prevent malicious code from being installed. Forged signatures also represent a significant breach of trust because certificates provide what’s supposed to be an unassailable assurance to end users that the software was developed by the company named in the certificate and hasn’t been modified by anyone else. The forgeries also allow malware to evade antivirus protections. Surprisingly, weaknesses in the majority of available AV programs prevented them from detecting known malware that was digitally signed even though the signatures weren’t valid.

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Estimating the Cost of Internet Insecurity

It’s really hard to estimate the cost of an insecure Internet. Studies are all over the map. A methodical study by RAND is the best work I’ve seen at trying to put a number on this. The results are, well, all over the map:

Estimating the Global Cost of Cyber Risk: Methodology and Examples“:

Abstract: There is marked variability from study to study in the estimated direct and systemic costs of cyber incidents, which is further complicated by the considerable variation in cyber risk in different countries and industry sectors. This report shares a transparent and adaptable methodology for estimating present and future global costs of cyber risk that acknowledges the considerable uncertainty in the frequencies and costs of cyber incidents. Specifically, this methodology (1) identifies the value at risk by country and industry sector; (2) computes direct costs by considering multiple financial exposures for each industry sector and the fraction of each exposure that is potentially at risk to cyber incidents; and (3) computes the systemic costs of cyber risk between industry sectors using Organisation for Economic Co-operation and Development input, output, and value-added data across sectors in more than 60 countries. The report has a companion Excel-based modeling and simulation platform that allows users to alter assumptions and investigate a wide variety of research questions. The authors used a literature review and data to create multiple sample sets of parameters. They then ran a set of case studies to show the model’s functionality and to compare the results against those in the existing literature. The resulting values are highly sensitive to input parameters; for instance, the global cost of cyber crime has direct gross domestic product (GDP) costs of $275 billion to $6.6 trillion and total GDP costs (direct plus systemic) of $799 billion to $22.5 trillion (1.1 to 32.4 percent of GDP).

Here’s Rand’s risk calculator, if you want to play with the parameters yourself.

Note: I was an advisor to the project.

Separately, Symantec has published a new cybercrime report with their own statistics.

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WhatsApp Vulnerability

A new vulnerability in WhatsApp has been discovered:

…the researchers unearthed far more significant gaps in WhatsApp’s security: They say that anyone who controls WhatsApp’s servers could effortlessly insert new people into an otherwise private group, even without the permission of the administrator who ostensibly controls access to that conversation.

Matthew Green has a good description:

If all you want is the TL;DR, here’s the headline finding: due to flaws in both Signal and WhatsApp (which I single out because I use them), it’s theoretically possible for strangers to add themselves to an encrypted group chat. However, the caveat is that these attacks are extremely difficult to pull off in practice, so nobody needs to panic. But both issues are very avoidable, and tend to undermine the logic of having an end-to-end encryption protocol in the first place.

Here’s the research paper.

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Detecting Drone Surveillance with Traffic Analysis

This is clever:

Researchers at Ben Gurion University in Beer Sheva, Israel have built a proof-of-concept system for counter-surveillance against spy drones that demonstrates a clever, if not exactly simple, way to determine whether a certain person or object is under aerial surveillance. They first generate a recognizable pattern on whatever subject­ — a window, say — someone might want to guard from potential surveillance. Then they remotely intercept a drone’s radio signals to look for that pattern in the streaming video the drone sends back to its operator. If they spot it, they can determine that the drone is looking at their subject.

In other words, they can see what the drone sees, pulling out their recognizable pattern from the radio signal, even without breaking the drone’s encrypted video.

The details have to do with the way drone video is compressed:

The researchers’ technique takes advantage of an efficiency feature streaming video has used for years, known as “delta frames.” Instead of encoding video as a series of raw images, it’s compressed into a series of changes from the previous image in the video. That means when a streaming video shows a still object, it transmits fewer bytes of data than when it shows one that moves or changes color.

That compression feature can reveal key information about the content of the video to someone who’s intercepting the streaming data, security researchers have shown in recent research, even when the data is encrypted.

Research paper and video.

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Security Breaches Don’t Affect Stock Price

Interesting research: “Long-term market implications of data breaches, not,” by Russell Lange and Eric W. Burger.

Abstract: This report assesses the impact disclosure of data breaches has on the total returns and volatility of the affected companies’ stock, with a focus on the results relative to the performance of the firms’ peer industries, as represented through selected indices rather than the market as a whole. Financial performance is considered over a range of dates from 3 days post-breach through 6 months post-breach, in order to provide a longer-term perspective on the impact of the breach announcement.

Key findings:

  • While the difference in stock price between the sampled breached companies and their peers was negative (1.13%) in the first 3 days following announcement of a breach, by the 14th day the return difference had rebounded to + 0.05%, and on average remained positive through the period assessed.

  • For the differences in the breached companies’ betas and the beta of their peer sets, the differences in the means of 8 months pre-breach versus post-breach was not meaningful at 90, 180, and 360 day post-breach periods.

  • For the differences in the breached companies’ beta correlations against the peer indices pre- and post-breach, the difference in the means of the rolling 60 day correlation 8 months pre- breach versus post-breach was not meaningful at 90, 180, and 360 day post-breach periods.

  • In regression analysis, use of the number of accessed records, date, data sensitivity, and malicious versus accidental leak as variables failed to yield an R2 greater than 16.15% for response variables of 3, 14, 60, and 90 day return differential, excess beta differential, and rolling beta correlation differential, indicating that the financial impact on breached companies was highly idiosyncratic.

  • Based on returns, the most impacted industries at the 3 day post-breach date were U.S. Financial Services, Transportation, and Global Telecom. At the 90 day post-breach date, the three most impacted industries were U.S. Financial Services, U.S. Healthcare, and Global Telecom.

The market isn’t going to fix this. If we want better security, we need to regulate the market.

Note: The article is behind a paywall. An older version is here. A similar article is here.

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