It was recently reported that as much as 250 customers of one of Sweden’s biggest banks got their accounts emptied. It is believed that the cyber criminals used a trojan on the bank customer's computers.
The bank in question is known to have one-time passwords (OTP) printed on a plastic card (with the size of a credit card). The OTPs are hidden behind the same kind of layer as scratch lottery tickets uses. To log in the user enters his username and password, scratches and enters the number that shows. The trojan (said to be based on Haxdoor) captured username, password and OTP, then it intercepted the transmission to the bank. Thus the trojan acted as a Mallory and not only as an Eve, see earlier post. By compromising the user's computer the two-factor authentication were circumvented. It is a known problem with security tokens like this and it was not even news to the bank itself. Even the digital variants like RSA SecurID has the same vulnerability, although in that case the 30-60 second timeframe makes it a little harder for the attacker.
Now with OTP
My bank recently improved their security by adding OTPs. Before they used username, password (pin code actually) and a client certificate. Really convenient but apparently not secure enough anymore. The OTPs they have provided their customers with is delivered as a numbered list of 50 OTPs on a piece of paper.
Could they be attacked in the same way as the other bank? If the trojan not already has the capability to copy client certificates I am convinced that it will be capable to do so in the future and then the same attack could be used.
A bold statement
What if there was a really simple way for a bank using this kind of login procedure to be several times more secure? While logging in to my bank a couple of weeks ago I suddenly realized that the bank knows something about my security token (the OTP list) that a trojan does not and that by using that information they could render the attack described above almost useless.
A simple proposal
It's all really simple and I have no intention to claim being the inventor of the scheme. If the procedure has a name other than random challenge of OTP then please inform me.
1. Ask for username+pin code
2. Challenge the user to enter OTP number n where n is a randomly chosen OTP of those that the user has left.
2.1 Even if the user does not enter an OTP it should be considered used up.
The trojan could of course present the user with a false page and challenge the user to enter OTP n but when the trojan then tries to use this OTP it's only one in 50 that it got the right one.
Sign my bills
I would also recommend any bank using OTPs to ask for one a second time for signing purposes. Let's say the customer has made a list of all the bills he is about to pay that month. If the bank then asks the customer for another randomly chosen OTP the attack above would really be rendered almost completely useless.
Not good enough?
The method of asking the user for a specified OTP is an easy enhancement for a paper based OTP numbered list. It does not need any new hardware or infrastructure but only a simple software change. Easy for both the bank and the customer. But what if you want to be even more secure?
A digital security token that lets you sign both account numbers and values of transactions is very secure, the downside is that it's also a lot more cumbersome for the user. A couple of banks in Sweden use these. Of course they are only secure as long as the algorithms involved aren't totally cracked but if they are you will hear about it.
I've been interested in computer security for a long time. Maybe watching War games and coding Commodore 64 made an impact on me as a boy. A couple of years later the annoying boot sector viruses on the Amiga kept my interest going.
In late 1995 I was involved in starting up a local Internet Service Provider. Me and a friend (a colleague at our day job) were the technicians. Our server ran Slackware Linux. Fast forward to late 1996. My collegue was sitting in our "office" and happened to notice some strange processes and activity on our server. He pulled the network plug immidiately. We had been hacked!
A couple of days later we got an email from an investigator in the US Airforce. Not that I really thought that it wasn't real but I still wanted more confirmation, so I asked him to call me. I will always remember his opening line "Hello, this is Special Agent Brian...". He asked if he could get some excerpts from certain logs and as far as I remember we provided them to him. He also told us that people like those breaking in into our system usually are very good at removing traces of their visit in the logs. My friends gut feeling and fast network disconnect made us keep the logs.
All that said I'm not working as a computer security specialist. I've been working as DBA, sysop, teacher, software developer, project manager and systems integrator. I like to think of myself as a software engineer with some social skills. Also I might have a little more focus and feel for computer security than the next guy.
So who's Alice? If you found this blog because of your interest in computer security it's a good chance that you already knew that in cryptography Alice, Bob and Mallory are often used as placeholders for common actors in different scenarios. I guess it's simpler to remember Alice and Bob than "The sender A wants to identify itself to receiver B" and alike. Alice usually wants to send data to Bob. If there exists an eavesdropper she is often called Eve. Mallory is a more dangerous animal than Eve because he has control over Alice's messages in such a way that he can change or resend then.
The first posting I had in mind for this blog involved Alice, Bob and Mallory and suddenly the blog had a name.
That "article" isn't quite finished yet. Now it is.