Contributor:
John E Dunn
January 29th, 2014

Data breaches multiply: Something is badly wrong, but what?

Target’s breach tells us the world still isn’t fixed. The list of world-famous firms humbled by data breaches since 2007 makes sobering reading: Heartland, TK Maxx, the Sony PlayStation Network, Evernote, and now retailer Target are among a long list that have ended up with their expensively-tended brand names etched into data security history for the wrong reasons.

Every one of them sent eerily identikit emails of apology to millions of customers delivering the news that their personal information and possibly card data could be in the hands of the world’s worst cybercriminals. Far from being delighted, commercial rivals look on with quiet dread; everyone fears they could be next.

We have a good idea how this all came to pass. For the last 20 years, organizations have eagerly consolidated customer databases into web-driven stores without comprehending the risks they were taking. Gigantic stores supported 21st Century data-centric business models, but unfortunately security assumptions remained stuck in the 1990s.

Shouldn’t firms be getting a grip by now? It’s not as if they don’t have plenty of detailed security guidance from the Payment Card Industry Data Security Standard (PCI-DSS), which has recently reached revision 3.0. Indeed, this update has been heavily influenced by the data breach era and should be purpose built to offer best practice.

The problem is that while PCI-DSS 3.0 adds some important upgrades it can still be pretty overwhelming, especially for smaller retailers grappling with its complex demands. This leaves many in the clutches of a seeming paradox; they need more and better security but not so that it adds a huge amount of cost. At the same time, not adopting PCI-DSS 3.0 will start to impose costs of its own, including in the longer term not being able to trade at all. Doing the minimum it isn’t an option either because breaches aren’t exactly cheap either.

Beyond the need to comply with PCI-DSS 3.0, the industry urgently needs to ponder some of the fundamentals. The first is why large well-resourced firms such as Target are still being beaten up by the hackers with such apparent ease. The second is to ask whether retailers are getting the basics of security right.

Disaster not averted

As far as we can tell, Target’s weakness existed on multiple levels. Somehow attackers got specially-written malware on the firm’s point-of-sale (POS) systems without that being detected. It is not known how this happened but it has been claimed that attackers breached the firm’s network, taking over a server that acted as a store for stolen data.

If true, that means that not only did the firm not detect that the POS had been compromised but didn’t detect a rogue server or its traffic within the network. This was allowed to go on for a while. Crazily, the point of sale malware used – allegedly a Russian program called ‘BlackPOS’ – had been known about since the middle of 2013 and could, it now turns out, have been used in attacks on other retailers. There was no alerting mechanism for the sector to report attacks or learn from the existence of the malware. This secrecy surely made firms sitting ducks.

Post-attack, with Target unwilling to go into much detail, the world will doubtless struggle to learn lessons from the attack because there is no requirement to explain what went wrong. The same lax regime of non-disclosure rules the world over. This stymies learning for everyone and increases the chances of others falling for the same routines. The attackers love this. Target will not be the last to suffer.

It’s tempting to generalize these problems into a simple recipe of reform so let’s not do that. What is valid is to point out that many organizations in retail and beyond still don’t have a thorough regime of access control and management of the server and PC resources that can be abused in such attacks. It’s not simply that basic controls on server, PC and admin privileges are lacking but there is no system to make sense of how they should be applied and modified. Without privilege monitoring and management, admin rights and the power they confer fly around networks with little control. This is utterly crazy and, justifiably, doesn’t cut it with PCI-DSS 3.0.

Organizations are slowly coming to the realization that attacks are a fact of business and compromises are inevitable. The resilient ones will be those with a map of their security controls with which to work out what went wrong and quickly put it right. Right now, the timescales appear to be weeks, months and sometimes never. That won’t hold in the future; response will have to happen in hours or minutes. That world can be glimpsed now in the distance and is still a way off but it is coming.

Massive data breaches and PCI-DSS 3.0 are, in their different ways, stressful. They should also be regarded as a warning for firms planning to stick around.

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