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Insurance and Ransomware

As ransomware becomes more common, I’m seeing more discussions about the ethics of paying the ransom. Here’s one more contribution to that issue: a research paper that the insurance industry is hurting more than it’s helping.

However, the most pressing challenge currently facing the industry is ransomware. Although it is a societal problem, cyber insurers have received considerable criticism for facilitating ransom payments to cybercriminals. These add fuel to the fire by incentivising cybercriminals’ engagement in ransomware operations and enabling existing operators to invest in and expand their capabilities. Growing losses from ransomware attacks have also emphasised that the current reality is not sustainable for insurers either.

To overcome these challenges and champion the positive effects of cyber insurance, this paper calls for a series of interventions from government and industry. Some in the industry favour allowing the market to mature on its own, but it will not be possible to rely on changing market forces alone. To date, the UK government has taken a light-touch approach to the cyber insurance industry. With the market undergoing changes amid growing losses, more coordinated action by government and regulators is necessary to help the industry reach its full potential.

The interventions recommended here are still relatively light, and reflect the fact that cyber insurance is only a potential incentive for managing societal cyber risk.They include: developing guidance for minimum security standards for underwriting; expanding data collection and data sharing; mandating cyber insurance for government suppliers; and creating a new collaborative approach between insurers and intelligence and law enforcement agencies around ransomware.

Finally, although a well-functioning cyber insurance industry could improve cyber security practices on a societal scale, it is not a silver bullet for the cyber security challenge. It is important to remember that the primary purpose of cyber insurance is not to improve cyber security, but to transfer residual risk. As such, it should be one of many tools that governments and businesses can draw on to manage cyber risk more effectively.

Basically, the insurance industry incents companies to do the cheapest mitigation possible. Often, that’s paying the ransom.

News article.

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Banning Surveillance-Based Advertising

The Norwegian Consumer Council just published a fantastic new report: “Time to Ban Surveillance-Based Advertising.” From the Introduction:

The challenges caused and entrenched by surveillance-based advertising include, but are not limited to:

  • privacy and data protection infringements
  • opaque business models
  • manipulation and discrimination at scale
  • fraud and other criminal activity
  • serious security risks

In the following chapters, we describe various aspects of these challenges and point out how today’s dominant model of online advertising is a threat to consumers, democratic societies, the media, and even to advertisers themselves. These issues are significant and serious enough that we believe that it is time to ban these detrimental practices.

A ban on surveillance-based practices should be complemented by stronger enforcement of existing legislation, including the General Data Protection Regulation, competition regulation, and the Unfair Commercial Practices Directive. However, enforcement currently consumes significant time and resources, and usually happens after the damage has already been done. Banning surveillance-based advertising in general will force structural changes to the advertising industry and alleviate a number of significant harms to consumers and to society at large.

A ban on surveillance-based advertising does not mean that one can no longer finance digital content using advertising. To illustrate this, we describe some possible ways forward for advertising-funded digital content, and point to alternative advertising technologies that may contribute to a safer and healthier digital economy for both consumers and businesses.

Press release. Press coverage.

I signed their open letter.

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The Future of Machine Learning and Cybersecurity

The Center for Security and Emerging Technology has a new report: “Machine Learning and Cybersecurity: Hype and Reality.” Here’s the bottom line:

The report offers four conclusions:

  • Machine learning can help defenders more accurately detect and triage potential attacks. However, in many cases these technologies are elaborations on long-standing methods — not fundamentally new approaches — that bring new attack surfaces of their own.
  • A wide range of specific tasks could be fully or partially automated with the use of machine learning, including some forms of vulnerability discovery, deception, and attack disruption. But many of the most transformative of these possibilities still require significant machine learning breakthroughs.
  • Overall, we anticipate that machine learning will provide incremental advances to cyber defenders, but it is unlikely to fundamentally transform the industry barring additional breakthroughs. Some of the most transformative impacts may come from making previously un- or under-utilized defensive strategies available to more organizations.
  • Although machine learning will be neither predominantly offense-biased nor defense-biased, it may subtly alter the threat landscape by making certain types of strategies more appealing to attackers or defenders.

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Bizarro Banking Trojan

Bizarro is a new banking trojan that is stealing financial information and crypto wallets.

…the program can be delivered in a couple of ways­ — either via malicious links contained within spam emails, or through a trojanized app. Using these sneaky methods, trojan operators will implant the malware onto a target device, where it will install a sophisticated backdoor that “contains more than 100 commands and allows the attackers to steal online banking account credentials,” the researchers write.

The backdoor has numerous commands built in to allow manipulation of a targeted individual, including keystroke loggers that allow for harvesting of personal login information. In some instances, the malware can allow criminals to commandeer a victim’s crypto wallet, too.

Research report.

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The Problem with Treating Data as a Commodity

Excellent Brookings paper: “Why data ownership is the wrong approach to protecting privacy.”

From the introduction:

Treating data like it is property fails to recognize either the value that varieties of personal information serve or the abiding interest that individuals have in their personal information even if they choose to “sell” it. Data is not a commodity. It is information. Any system of information rights­ — whether patents, copyrights, and other intellectual property, or privacy rights — ­presents some tension with strong interest in the free flow of information that is reflected by the First Amendment. Our personal information is in demand precisely because it has value to others and to society across a myriad of uses.

From the conclusion:

Privacy legislation should empower individuals through more layered and meaningful transparency and individual rights to know, correct, and delete personal information in databases held by others. But relying entirely on individual control will not do enough to change a system that is failing individuals, and trying to reinforce control with a property interest is likely to fail society as well. Rather than trying to resolve whether personal information belongs to individuals or to the companies that collect it, a baseline federal privacy law should directly protect the abiding interest that individuals have in that information and also enable the social benefits that flow from sharing information.

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On Chinese-Owned Technology Platforms

I am a co-author on a report published by the Hoover Institution: “Chinese Technology Platforms Operating in the United States.” From a blog post:

The report suggests a comprehensive framework for understanding and assessing the risks posed by Chinese technology platforms in the United States and developing tailored responses. It starts from the common view of the signatories — one reflected in numerous publicly available threat assessments — that China’s power is growing, that a large part of that power is in the digital sphere, and that China can and will wield that power in ways that adversely affect our national security. However, the specific threats and risks posed by different Chinese technologies vary, and effective policies must start with a targeted understanding of the nature of risks and an assessment of the impact US measures will have on national security and competitiveness. The goal of the paper is not to specifically quantify the risk of any particular technology, but rather to analyze the various threats, put them into context, and offer a framework for assessing proposed responses in ways that the signatories hope can aid those doing the risk analysis in individual cases.

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Router Security

This report is six months old, and I don’t know anything about the organization that produced it, but it has some alarming data about router security.

Conclusion: Our analysis showed that Linux is the most used OS running on more than 90% of the devices. However, many routers are powered by very old versions of Linux. Most devices are still powered with a 2.6 Linux kernel, which is no longer maintained for many years. This leads to a high number of critical and high severity CVEs affecting these devices.

Since Linux is the most used OS, exploit mitigation techniques could be enabled very easily. Anyhow, they are used quite rarely by most vendors except the NX feature.

A published private key provides no security at all. Nonetheless, all but one vendor spread several private keys in almost all firmware images.

Mirai used hard-coded login credentials to infect thousands of embedded devices in the last years. However, hard-coded credentials can be found in many of the devices and some of them are well known or at least easy crackable.

However, we can tell for sure that the vendors prioritize security differently. AVM does better job than the other vendors regarding most aspects. ASUS and Netgear do a better job in some aspects than D-Link, Linksys, TP-Link and Zyxel.

Additionally, our evaluation showed that large scale automated security analysis of embedded devices is possible today utilizing just open source software. To sum it up, our analysis shows that there is no router without flaws and there is no vendor who does a perfect job regarding all security aspects. Much more effort is needed to make home routers as secure as current desktop of server systems.

One comment on the report:

One-third ship with Linux kernel version 2.6.36 was released in October 2010. You can walk into a store today and buy a brand new router powered by software that’s almost 10 years out of date! This outdated version of the Linux kernel has 233 known security vulnerabilities registered in the Common Vulnerability and Exposures (CVE) database. The average router contains 26 critically-rated security vulnerabilities, according to the study.

We know the reasons for this. Most routers are designed offshore, by third parties, and then private labeled and sold by the vendors you’ve heard of. Engineering teams come together, design and build the router, and then disperse. There’s often no one around to write patches, and most of the time router firmware isn’t even patchable. The way to update your home router is to throw it away and buy a new one.

And this paper demonstrates that even the new ones aren’t likely to be secure.

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Chinese Supply-Chain Attack on Computer Systems

Bloomberg News has a major story about the Chinese hacking computer motherboards made by Supermicro, Levono, and others. It’s been going on since at least 2008. The US government has known about it for almost as long, and has tried to keep the attack secret:

China’s exploitation of products made by Supermicro, as the U.S. company is known, has been under federal scrutiny for much of the past decade, according to 14 former law enforcement and intelligence officials familiar with the matter. That included an FBI counterintelligence investigation that began around 2012, when agents started monitoring the communications of a small group of Supermicro workers, using warrants obtained under the Foreign Intelligence Surveillance Act, or FISA, according to five of the officials.

There’s lots of detail in the article, and I recommend that you read it through.

This is a follow on, with a lot more detail, to a story Bloomberg reported on in fall 2018. I didn’t believe the story back then, writing:

I don’t think it’s real. Yes, it’s plausible. But first of all, if someone actually surreptitiously put malicious chips onto motherboards en masse, we would have seen a photo of the alleged chip already. And second, there are easier, more effective, and less obvious ways of adding backdoors to networking equipment.

I seem to have been wrong. From the current Bloomberg story:

Mike Quinn, a cybersecurity executive who served in senior roles at Cisco Systems Inc. and Microsoft Corp., said he was briefed about added chips on Supermicro motherboards by officials from the U.S. Air Force. Quinn was working for a company that was a potential bidder for Air Force contracts, and the officials wanted to ensure that any work would not include Supermicro equipment, he said. Bloomberg agreed not to specify when Quinn received the briefing or identify the company he was working for at the time.

“This wasn’t a case of a guy stealing a board and soldering a chip on in his hotel room; it was architected onto the final device,” Quinn said, recalling details provided by Air Force officials. The chip “was blended into the trace on a multilayered board,” he said.

“The attackers knew how that board was designed so it would pass” quality assurance tests, Quinn said.

Supply-chain attacks are the flavor of the moment, it seems. But they’re serious, and very hard to defend against in our deeply international IT industry. (I have repeatedly called this an “insurmountable problem.”) Here’s me in 2018:

Supply-chain security is an incredibly complex problem. US-only design and manufacturing isn’t an option; the tech world is far too internationally interdependent for that. We can’t trust anyone, yet we have no choice but to trust everyone. Our phones, computers, software and cloud systems are touched by citizens of dozens of different countries, any one of whom could subvert them at the demand of their government.

We need some fundamental security research here. I wrote this in 2019:

The other solution is to build a secure system, even though any of its parts can be subverted. This is what the former Deputy Director of National Intelligence Sue Gordon meant in April when she said about 5G, “You have to presume a dirty network.” Or more precisely, can we solve this by building trustworthy systems out of untrustworthy parts?

It sounds ridiculous on its face, but the Internet itself was a solution to a similar problem: a reliable network built out of unreliable parts. This was the result of decades of research. That research continues today, and it’s how we can have highly resilient distributed systems like Google’s network even though none of the individual components are particularly good. It’s also the philosophy behind much of the cybersecurity industry today: systems watching one another, looking for vulnerabilities and signs of attack.

It seems that supply-chain attacks are constantly in the news right now. That’s good. They’ve been a serious problem for a long time, and we need to take the threat seriously. For further reading, I strongly recommend this Atlantic Council report from last summer: “Breaking trust: Shades of crisis across an insecure software supply chain.

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Survey of Supply Chain Attacks

The Atlantic Council has a released a report that looks at the history of computer supply chain attacks.

Key trends from their summary:

  1. Deep Impact from State Actors: There were at least 27 different state attacks against the software supply chain including from Russia, China, North Korea, and Iran as well as India, Egypt, the United States, and Vietnam.States have targeted software supply chains with great effect as the majority of cases surveyed here did, or could have, resulted in remote code execution. Examples: CCleaner, NotPetya, Kingslayer, SimDisk, and ShadowPad.

  2. Abusing Trust in Code Signing: These attacks undermine public key cryptography and certificates used to ensure the integrity of code. Overcoming these protections is a critical step to enabling everything from simple alterations of open-source code to complex nation-state espionage campaigns. Examples: ShadowHammer, Naid/McRAT, and BlackEnergy 3.

  3. Hijacking Software Updates: 27% of these attacks targeted software updates to insert malicious code against sometimes millions of targets. These attacks are generally carried out by extremely capable actors and poison updates from legitimate vendors. Examples: Flame, CCleaner 1 & 2, NotPetya, and Adobe pwdum7v71.

  4. Poisoning Open-Source Code: These incidents saw attackers either modify open-source code by gaining account access or post their own packages with names similar to common examples. Attacks targeted some of the most widely used open source tools on the internet. Examples: Cdorked/Darkleech, RubyGems Backdoor, Colourama, and JavaScript 2018 Backdoor.

  5. Targeting App Stores: 22% of these attacks targeted app stores like the Google Play Store, Apple’s App Store, and other third-party app hubs to spread malware to mobile devices. Some attacks even targeted developer tools ­ meaning every app later built using that tool was potentially compromised. Examples: ExpensiveWall, BankBot, Gooligan, Sandworm’s Android attack, and XcodeGhost.

Recommendations included in the report. The entirely open and freely available dataset is here.

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