Dr. Philip Cao (aka #DrPC), EDBA, MSCS, ZTX-I, CCISO, CISM, CMSC, CCSP, CCSK, CASP, GICSP, PCSPI is a Strategist, Advisor, Educator, Contributor and Motivator. He’s also a Cyber | Zero Trust Strategist & Evangelist and Chief Trust Officer. He has 24 years’ experience in IT/Cybersecurity industry in various sectors & positions.
This week, Protiviti and ISACA issued results of the fourth annual IT Audit Benchmarking Study. The organizations surveyed 1,330 IT audit leaders across the globe, including chief audit executives, IT audit vice presidents and directors, who answered questions in five categories:
Today’s Top Technology Challenges
IT Audit in Relation to the Internal Audit Department
Assessing IT Risks
Audit Plan
Skills and Capabilities
The survey found that, although organizations have made strides in establishing best practices for the IT audit function, many are struggling to keep pace with global IT risks amid rapidly changing technology environments.
“Concerns over cybersecurity, industry disruptors and regulatory compliance have moved many organizations, and audit committees in particular, to become more engaged in the IT audit function,” said David Brand, a Protiviti managing director and the firm’s global IT audit leader. “We see some positive trends in our results, notably in the number of designated IT audit directors and their regular attendance at audit committee meetings. However, we also see significant gaps to be addressed, including the frequency with which IT audit risk assessments are conducted.”
Top Technology Challenges
The survey also revealed the top 10 technology challenges that respondents say their organizations face today:
IT security and privacy/cybersecurity
Resource/staffing/skills challenges
Emerging technology and infrastructure changes: transformation, innovation, disruption
Regulatory compliance
Budgets and controlling costs
IT governance and risk management
Big data and analytics
Vendor, third-party and outsourcing risks
Cloud computing/ virtualization
Bridging IT and the business
Establishing Organizationwide Support for IT Audit
The IT Audit Benchmarking Study found that more than half of the largest public companies surveyed have a designated IT audit director or equivalent position within their organizations, and 48 percent reported that these individuals regularly attend audit committee meetings – a number that has doubled over the past three years. Additionally, respondents indicated that their audit committees have increased their involvement in the IT risk assessment process, with 20 percent reporting significant involvement as compared to 14 percent in 2013.
The increased resources and attention to IT audit is a positive sign that companies of all sizes around the world are recognizing the significant benefits of this critical function.
Small Gains in IT Audit Risk Assessments
The ISACA/Protiviti survey also reveals a modest uptick in the number of organizations that update their IT audit risk assessment on a continual basis. However, this number still remains low—around 15 percent—for even the largest companies.
Additional Highlights
Other research findings of note include:
Globally, respondents cited COBIT as the most accepted industry framework on which the IT audit risk assessment is based, followed by COSO, ISO and SOGP. In practice, organizations may utilize a combination of these frameworks to complete their risk assessments.
Across every region and size of respondent organization, lack of resources ranks as the top reason why companies are using outside resources to augment their IT audit skills – and in fact, the percentages are very consistent. These findings are also in line with the top technology challenges outlined above.
As 2014 comes to a close, our subject matter experts check in on what they see as major topics and trends for the new year. (You can read all of our 2015 predictions content here.)
I know this is a cliché statement, but this year has flown by at the speed of light. I love looking to the future and I can’t wait to see how next year will shape up. Looking back on a few key trends in threat prevention for 2014, I can provide some insight into what awaits us in 2015. Here are three trends that stuck out as important indicators of what’s to come in the next year.
1. Attackers will use more legitimate and convoluted means to launch widespread attacks.
You’ve likely seen the word “malvertising” tossed around. This attack method has been around for a few years, and Yahoo! and AOL were both targets in September and October of this year, earning attackers thousands of dollars per day.
But the use of malvertising as an attack method is a shift from the kind of dark-corner trickery seen in spear phishing and packet sniffing to a technique that leverages a legitimate business process to do all the hard work normally involved in delivering malware. The process gives the attacker access to potentially millions of users with minimal effort. All the attacker has to do is design the malvertisement code.
We’ll be seeing a lot more of these types of malware delivery methods. Not just malvertising campaigns, but also the use of bona fide business procedures to deliver malware and amplify results. Widely-used business channels with little to no security are tempting targets for attackers; they provide a constant stream of unsuspecting targets and feature lots of moving parts that make it impossible to track down the attackers. It will require careful coordination to make these channels more secure.
2. Application security is getting better all the time. However, we will continue to see a steady stream of zero-days, mostly related to legacy code.
Secure coding practices have become a part of the software developer’s everyday life. In the past few years, we’ve seen more application security and development teams turn to static and dynamic analysis to catch code and business logic vulnerabilities and fix them before the application is released or updates are pushed.
Customers are starting to build time-to-fix clauses with monetary penalties into their contracts with vendors. If anything is clear in the B2B universe, it’s that vulnerabilities affect application integrity, which affects customer trust, which affects revenue. It’s easier and much cheaper to fix vulnerabilities during the early development cycle than once an application has reached production or even QA.
However, this also means that legacy code is much more expensive to fix, even if a vulnerability has not yet been exploited in the wild. Along with the fact that black hat hackers are continuing to get more creative, this is the reason why the number of CVEs in 2015 will remain at least equal to if not greater than the number reported in 2014.
3. IPS functionality and firewall functionality will meld more than it already has.
As the enterprise market sees the benefits of a true platform-based approach to security, I suspect we’ll see more vendors phasing out stand-alone and UTM security solutions. What better way to truly bolster the way IPS handles security than by including other defensive techniques like decryption, decompression, application-ID, user-ID, data-loss prevention, and sandboxing?
The market’s move from traditional IPS to Next-Generation IPS to NGFW + NGIPS already started, but there’s more innovating to be done to supply security that keeps up with what the bad guys are doing. There’ll be more appeal than ever for a single, integrated platform that “does it all,” doesn’t require users to take a performance hit, and can be used anywhere from data centers to the cloud.
So, who else is excited for 2015?
Threat prevention is among many focus topics at Ignite 2015, where you will tackle your toughest security challenges, get your hands dirty in one of our workshops, and expand your threat IQ. Register now to join us March 30-April 1, 2015 in Las Vegas — the best security conference you’ll attend all year.
It is hard to imagine a world in which we didn’t use the Internet at work. 15 years ago, it was a luxury. Today, Internet use at work is mission-critical. We’ve evolved from casually getting online to search for basic information about a company to doing such critical things as accessing webmail, posting to and monitoring social media and transferring and storing files in the cloud.
Unfettered Internet access at work has empowered us to defy geographical and time constraints to communicate with colleagues, vendors and customers located around the globe, develop content and code, and share real-time 24 x 7. It also allows us to shop, gamble, chat with friends, check bank balances and pay bills at work and generally “cyber loaf” on the company network, to the tune of US $178 billion in lost productivity annually, according to U.S. security company Websense. According to IDC, 30 to 40% of Internet access is now spent on non-work related browsing, and 60% of all online purchases are made during working hours.
The prevalence of smartphones and social media and our evolution into an “always on” society have further blurred the lines between personal and professional lives, bringing our privacy into question and leaving lawmakers dumbfounded as to how to govern personal privacy in light of these changes.
Absent legislation that helps companies navigate this new reality, in an effort to curb employees’ increasing amount of personal time they spend online at work, some companies have implemented monitoring systems that leave employees feeling watched and mistrusted, without really solving the problem of protecting the company network.
The good news is that incorporating individual protection into your risk management strategy can actually make your organizationMORE secure. By championing employee privacy, you can empower individuals to become personally accountable for their decisions online and engage them in protecting the organization. You can achieve this by separating personal and work assets and providing employees a private portal to conduct their personal online business at work. By isolating personal browsing from the corporate network, employees can surf and communicate freely and securely, while corporate assets are shielded from employee activity.
In this latest of our lightboard sessions, Warby Warburton shows how the seamless integration between VMware NSX and our VM-Series virtualized Next-Generation Firewalls allows you to automate security provisioning, inclusive of firewall services and associated security policies, as a means of segmenting your virtual machines using Zero Trust principles.
Watch below to better understand next-generation security that will keep pace with your virtualized data center:
For more on Palo Alto Networks integration with VMware
The Cybersecurity Canon is official, and you can now see our website here. We modeled it after the Baseball or Rock & Roll Hall-of-Fame, except for cybersecurity books. We have 20 books on the initial candidate list but we are soliciting help from the cybersecurity community to increase the number to be much more than that. Please write a review and nominate your favorite.
The Cybersecurity Canon is a real thing for our community. We have designed it so that you can directly participate in the process. Please do so!
Book Review: Spam Nation: The Inside Story of Organized Cybercrime from Global Epidemic to Your Front Door (2014) by Brian Krebs
Executive Summary
In Spam Nation, Brian Krebs covers a key portion of our cybersecurity and cyber crime history: 2007–2013, that period when we started to learn about the Russian Business Network, bulletproof-hosting providers, fast-flux obfuscation, criminal best business practices, underground cyber crime forums, and strange-sounding botnet names like Conficker, Rustock, Storm, and Waledac.
This period just happens to coincide with Krebs’s rise in popularity as one of the leading cybersecurity journalists in the industry. His relationship with two competitive pharmaceutical spammers—Pavel Vrublevsky and Dimitry Nechvolod—is a big bag of crazy and is the key storyline throughout the book. The competition between Vrublevsky and Nechvolod escalated into something that Krebs calls the Pharma Wars and Krebs gives us a bird’s-eye view into the details of that escalation that eventually destroyed both men and the industry they helped to create. Krebs’s weird symbiotic relationship with Vrublevsky is worth the read by itself. Spam Nation is definitely a Cybersecurity Canon candidate. It’s just out today, so I won’t say you should have read this by now – but get on it as soon as you can.
Introduction
I have been a fan of Brian Krebs for many years. His blog, Krebs on Security, has been a mainstay of my reading list since he started it in 2010, and even before when he was writing forThe Washington Post. Since he struck out on his own, he has carved out a new kind of journalism that many reporters are watching to see how they might duplicate it themselves as journalism transitions from dead-tree printing to new media, and the idea that the author is the brand. Krebs’s beat is cybersecurity, and he is the leading journalistic authority on the underbelly of cyber crime. Spam Nation is a retelling — with more detail and more color — of some of the stories he covered from 2007 until about 2013 on a very specific sub-element of the cyber crime industry called pharmaceutical spam.
Many security practitioners will hear the phrase “pharmaceutical spam” and immediately start to nod off. Of all the problems they encounter on a daily basis, pharmaceutical spam is pretty low on the priority list. While that may be true, this subset of cyber crime is responsible for starting and maturing many of the trappings that we associate with cyber crime in general: botnet engines, fast-flux obfuscation, spamming, underground forums, cyber crime markets, good service as a distinguisher of criminal support services, and bulletproof-hosting providers.
The Story
The story really begins with Krebs’s weird symbiotic relationship with Vrublevsky (a.k.a. RedEye and Despduck). Vrublevsky was a Russian businessman, and cofounder and former CEO of ChronoPay, the infamous credit card processing company that initially got started in the rogue anti-virus industry. I think it is safe to say that in his heyday, Vrublevsky was a bit of an extrovert. He followed Krebs’s blog religiously and would instigate long conversations with Krebs on stories that were fantastical, true, and everything in between. Vrublevsky would feed Krebs half-truths about what was going on in the industry and left it to Krebs to sort it out. Vrublevsky’s downfall was his deteriorating relationship with his former partner, Dimitry Nechvolod (a.k.a. Gugle).
Vrublevsky and Nechvolod founded ChronoPay together in 2003, but by 2006, Nechvolod had left the company to pursue his own interests. He started two pharmacy spam operations called GlavMed and SpamIT. Because of the competition between these two men, the situation escalated out of control, to something that Krebs calls the Pharma Wars, which ultimately scuttled the entire pharmaceutical spam industry, not just Vrublevsky and Nechvolod’s operations, but everybody else’s, too.
Krebs’s main sources of information for this book came from leaked customer and operational databases from these two men. Although Vrublevsky and Nechvolod never admitted it, they both stole the other’s data and leaked it to Krebs. Krebs had many conversations with both Vrublevsky and Nechvolod about their side of the story, and Krebs even traveled to Moscow to interview Vrublevsky personally. From these conversations and other research done by Krebs, we get an inside view of how cyber crime operates in the real world.
Krebs set himself seven research questions:
Who is buying the stuff advertised in spam and why?
Are the drugs real or fake?
Who profits?
Why does the legitimate pharmaceutical industry seem powerless to stop it?
Why is it easy to pay for the drugs with credit cards?
Do customers have their credit card accounts hacked after buying?
What can consumers, policy makers, and law enforcement do [about this cybercrime]?
For the most part, he answers all these questions in the book. I will not spill the answers here, but I will tell you that I was surprised by every single one. I thought I knew this stuff, but Krebs provides the insight and research to make you re-evaluate what you think you know about illegal pharmaceutical spam operations.
Spam Nation is about the Brian Krebs story, too. Traditional journalists reading this book are going to hate the fact the he plays a key role in most everything that he talks about in this book, but it seems inevitable given that Krebs is himself a journalistic brand now. His original reporting on bulletproof-hosting providers operating in the US and elsewhere — the Russian Business Network (RBN), Atrivo, and McColo — became that catalyst that eventually got them shut down. This got him noticed by Vrublevsky and started that weird relationship that ultimately led to Krebs receiving the databases from Vrublevsky and Nechvolod. It also led him to leave The Washington Post and to start Krebs on Security.
In the background, Krebs introduces us to the key players involved in the development and operations of some of the most infamous botnets that have hit the Internet community in recent history:
Conficker worm (author: Severa; infected 9-15 million computers)
Cutwail botnet (authors: Dimitry Nechvolod (Gugle) and Igor Vishnevsky; 125,000 infected computers; spewed 16 billion spam messages a day)
Grum botnet (author: GeRA; spewed 18 billion e-mails a day)
Festi botnet (operators: Artimovich brothers; delivered one-third of the total amount of worldwide spam)
From my reading, Krebs’s unintentional hero of his story is Microsoft. While Vrublevsky and Nechvolod were tearing each other apart and Krebs was trying to sift through what was true and what was not, Microsoft and other commercial, academic, and government organizations were quietly dismantling the infrastructure that these and other illicit operations depended on:
June 2009: 15,000 illicit websites go dark at 3FN after the Federal Trade Commission convinced a northern California judge that 3FN was a black-hat service provider. NASA did the forensics work.
November 2009: FireEye takes down the Mega-D botnet.
January 2010: Neustar takes control of the Lethic spam botnet.
March 2010: Microsoft takes down the Waledac botnet.
October 2010: Armenian authorities take down the Bredolab botnet.
March 2011: Microsoft takes down the Rustock botnet.
July 2011: Microsoft offers a $250,000 reward for information leading to the arrest and conviction of the Rustock botmaster.
July 2012: FireEye and Spamhaus take down the Grum botnet.
July 2013: Microsoft and the FBI take down 1,400 botnets using the Citadel malware to control infected PCs.
December 2013: Microsoft and the FBI take down the ZeroAccess botnet.
June 2014: The FBI takes down of the Gameover Zeus botnet.
One takedown masterstroke came out of academia. George Mason University, the International Computer Science Institute, the University of California, San Diego, and Microsoft determined that 95 percent of all spam credit card processing was handled by three financial firms: one in Azerbaijan, one in Denmark, and one in Nevis (West Indies). They also pointed out that these financial firms were in violation of Visa’s own Global Brand Protection Program contract that required fines of $25,000 for transactions supporting the sale of Viagra, Cialis, and Levitra. Once Visa started levying fines, the financial firms stopped processing the transactions. The beauty of this takedown was that this was not a legal maneuver through the courts and law enforcement. It merely encouraged Visa to follow its own policy.
Cyber Crime Business Operations
For me, one of the most enjoyable parts of Spam Nation is the insight on how these criminal organizations operate. For example, Krebs highlights why pharmaceutical operations have great customer support: they want to avoid the penalty fees associated with a transaction when a buyer of illicit pills charges them with fraud. These are called chargebacks, and pharmaceutical customer support operations avoid them like the plague. These support operations require teams of software developers and technical support staff to be available 24/7.
Pharmaceutical operations have mature anti-fraud measures — equivalent to any legitimate bank’s anti-fraud measures — because they need to keep law enforcement and security researchers out of their business.
Most spammers do not make a lot of money. The top five do, but not everybody else. Krebs points out that it takes a multibillion-dollar security industry to defend against a collection of criminals who do this to make a living wage.
In terms of botnet management, operators rent out top-earning botnets to other operators who do not have the skill to build a botnet themselves. Renters purchase installs and seed a prearranged number of bots with an additional malicious program that sends spam for the affiliate. They pay the rent by diverting a portion of their commissions on each pill sale from spam. Sometimes, that commission is as high as 50 percent. That is why the small-timers do not make any money.
Operators launder their money in a process called factoring. They map their client transactions into accounts on behalf of previously established shell companies. They tell the banks that the shell companies are the true customers. Then the operators pay the clients out of their own pockets.
Russian law allows FSB agents (Federal Security Service, the successor to the Soviet Union’s KGB), while remaining in the service, to be assigned to work at enterprises and organizations at the consent of their directors. Twenty percent of FSB officers are engaged in this protection business called “Krusha” in Russian, which means “roof” and pharmaceutical spam operations use them as much as possible.
Partnerships, called partnerkas, between spammers and dodgy advertisers that act as an intermediary for potential sponsors are essential. In this way, sponsors keep their distance from the illicit aspects of the spam business and can unplug from one partnerka in favor of another whenever they want. Some refer to this as organized crime (think TheGodfather), but it is more like a loosely affiliated network of independent operators.
With all of these best business practices, you can see why the operators do not see themselves as criminals. They are just businesspeople trying to run a business.
The Tech
Cyber crime runs on technology. In the pharmaceutical spam business, some tech is unique, and other tech is shared with other kinds of cyber crime operations. Unique to pharmaceutical spam is a technique called black search engine optimization (Black SEO). Pharmaceutical spammers hack legitimate websites and insert hidden pages (IFrames) with loads of pharmaceutical websites links. The more links that the common search engines like Google and Bing index, the higher the pharmaceutical sites get in the priority list when normal users search for pills online.
Also unique to the pharmaceutical spam business is a good spam ecosystem. It must have the ability to keep track of how many e-mails the system delivered and how many recipients clicked the link. It must scrub e-mail addresses that are no longer active or are obvious decoys and harvest new e-mail addresses for future operations.
Not unique to pharmaceutical spam are the forums. Forums are the glue that allows the loosely affiliated network of independent operators to communicate with each other. Forums are a place that allows newbies an opportunity to establish a reputation and lowers the barriers to entry for a life of cyber crime. There are forums for every language, but most are in English. Members enforce a strict code of ethics so that members who are caught cheating other members are quickly banned. Social networking rankings give members a way to evaluate potential partners. A single negative post may cost an individual thousands of dollars. Because of that, most amicably resolve issues. Sometimes newbies get labeled as a “deer,” or members who unintentionally break one of the forum’s rules. More serious infractions might find a member in the blacklist subforum defending himself or herself from fraud allegations.
New forums start all the time, but some have been in existence for more than a decade, indicating process maturity for self-policing, networking, and rapid information sharing. New forums allow open registration, but mature forums set up various hurdles for membership that are designed to screen out law enforcement and hangers-on. Most have sub-rooms for specialization such as the following:
Spam
Cyber banking fraud
Bank account cash-out schemes
Malicious software development
ID theft
Credit card fraud
Confidence scams
Black SEO
Forums have many members (tens of thousands in some), but they exist to make money for the administrators. Admins offer additional services to improve the user experience. They offer escrow services — a small percentage of the transaction cost held until both sides agree that the other held up its end of the bargain — and stickies — ads that stay at the top of their sub-forums that range in price from $100 to $1,000 per month.
Conclusion
In Spam Nation, Brian Krebs covers a key portion of our cyber security and cyber crime history: 2007– 2013, that period when we started to learn about the Russian Business Network, bulletproof-hosting providers, fast-flux obfuscation, criminal best business practices, underground cyber crime forums, and strange-sounding botnet names like Conficker, Cutwail, Grum, Festi, Rustock, Storm, and Waledac. This period just happens to coincide with Krebs’s rise in popularity as one of the leading cybersecurity journalists in the industry. His story, and the story of two competitive pharmaceutical spammers who eventually destroyed the lucrative moneymaking scheme for all players, is a fascinating read. It is definitely a Cybersecurity Canon candidate.
