Ecommerce: Security and Control

James Vickers, Boston College

http://www.jamesvickers.com/jamie@boston.ac.uk

Overview

Why are modern day information systems so vulnerable to destruction, error, abuse, and system quality problems?

What types of controls are available for ecommerce systems?

What special measures must be taken to ensure the reliability, availability and security of electronic commerce and digital business processes?

Why are auditing ecommerce systems and safeguarding data quality so important?

The business predicament

Do we design systems that over-controlled, and therefore not functional, or unrestricted and under-controlled?

How do we applying quality assurance standards in large ecommerce systems projects

The business predicament

The major concerns for businesses Disaster

• The possible destruction of computer hardware, programs, data files, and other equipment

Security• Preventing unauthorized access, alteration, theft, or

physical damage to equipment Errors

• Computer actions that may disrupt or destroy organization’s record-keeping and operations

Bugs• Program code defects or errors

Maintenance Nightmare• Maintenance costs high due to organizational change,

software complexity, and faulty system analysis and design

The general processing model

Unfortunately, all of these stages can contain elements of failure, unless a strategy is implemented, and software quality assurance standards are implemented

Figure 1

The cost of poor design

Figure 2

The business predicament

Control What is needed?

• Methods, policies, and procedures

Why is it needed?• Ecommerce systems may provide (limited) access to

a business central infrastructure• Ensures protection of organization’s assets• Ensures accuracy and reliability of records, and

operational adherence to management standards

When should this occur?• From the ideas inception, to the completion of the

ecommerce system

Controlling our ecommerce plan At a business level:

Market research into user needs, and identified areas for business expansion

A business and financial plan for forecasting frequency of use, and suspected revenue turnover

A strategy on how to implement this plan, alongside our current business plan (if we are expanding a “brick and mortar” business that is).

A review of our internal technical skills – are our staff competent enough to implement this, or should we outsource.

Controlling our ecommerce plan General controls

Establish framework for controlling design, security, and use of computer programs

Include software, hardware, computer operations, data security, implementation, and administrative controls. These may include:

• Personnel controls: Ensuring that only authorised personal undertake elements of the project

• Customer controls: Ensuring that protection is provided from the global customer layer of the ecommerce system, to the business infrastructure layer of business operations

Controlling our ecommerce plan Protecting our company

On-line transaction processing: Transactions entered online are immediately processed by computer, and recorded for audit

Fault-tolerant computer systems: Contain extra hardware, software, and power supply components in case of element failure

High-availability computing: Tools and technologies enabling system to recover from a crash, or power cut

Disaster recovery plan: Plan of action in case of ecommerce system failure. Ask yourself the question, if we trade online and the “shop front” is gone, how do we trade?

Load balancing: Heavy traffic will need distribution over a large servers

Controlling our ecommerce plan Protecting our company

Mirroring: Duplicating all processes and transactions of ecommerce on backup server to prevent any interruption

Clustering: Linking two computers together so that a second computer can act as a backup to the primary computer or speed up processing

Firewalls: For prevent unauthorised users from accessing a private internal network, or accessing private data. Don’t forget this covered under the data protection act.

Intrusion Detection Systems or Personnel to monitor vulnerable points in the network to detect or deter unauthorized intruders

Controlling our ecommerce plan How many of you have assumed that security of

ecommerce systems is an Internet threat only? I would bet the majority of you…..

Now we need to forget that we have planned for ecommerce systems, and consider in depth our security issues

We shall look at security in terms of the whole networked community, not just ecommerce.

Why? Because security is more often than not overlooked at a local level, never mind at a global level!

Security is a major concern, not just at a global interface level, but at an internal business level too…

Security

This raises big questions…..

What is security?

What constitutes security?

What examples can we provide of security?

Security needs

Who says we need security?: Data Protection Acts 1984 & 98 Telecommunications (Lawful Business Practice)

(Interception of Communications) Regulations 2000• Allows employers to monitor or record communications

without consent• to establish the existence of facts relevant to the business• to ascertain compliance with regulations• to ascertain standards which ought to be achieved by staff• to detect unauthorised use

Information Security

Reformed: Two major reforms

over last several decades

• Computer Security• Network Security

Widespread use of data processing

Security previously handled by:

• Physical means: Filing cabinet and lock

• Administrative means: Personnel

Computers Introduction meant

that new regulations had to be imposed by organisations to secure data

Shared systems, were worse because of sending / retrieving data of numerous systems

Information Security

Routing Services

Security Office

Server Protection

Why the reforms?

Computer Security: Evolved with the

need to protect data

Needed to prevent hackers

Needed to abide by data protection act

Network Security: Heightened by the

need for distributed systems

Heightened by the need for secure networks and communications

Need to protect data during transmission

Ensure data is authentic

Local Information Security

Various methods available: DVD-RAM Drive SAN’s RAID Arrays Most efficient (and common) method:

• DAT / DLT Data security is big business!

• Storage “off-site”

• Storage in safes• Fireproof!

• Bombproof!

Security Requirements

Classified in three ways: Confidentiality:

• Authorised parties can read the data• Disclosure of data to relevant source

Integrity:• Authorised parties can modify the data• Changes status of the data by relevant

source Availability:

• Authorised parties can access the data

What next?

We have planned…. We have designed…. We have restricted access…. We have investigated our needs….

We then sit back and wait while our systems are attacked….

Network Attacks!

Passive: “Eavesdropping” “Release of message contents”:

• Extracting information from mail messages, telephone conversations etc

“Traffic Analysis”:• Analysis of message lengths, Tx & Rx, to guess the

types of information being Tx & Rx.

Network Attacks

Active Attacks: “Masquerade”:

• One node pretends to be another node. • Tx is fooled into thinking that Rx has received message.

“Replay”:• Captures data and then retransmits to fool Tx into thinking

the message was unauthorised “Modification of Message”:

• The Tx message is intercepted, and modified to the intruders benefit – e.g. Funds Balances etc.

• Message is forwarded to intended Rx “Denial of Service”

• Inhibits or hinders data communications traffic, but targeting the management and communications facilities

Network Attacks

Passive: Sniffers / Probes Difficult to detect Do not alter data Can prevent these

attacks Prevention, rather

than detection

Active: Opposite to passive Difficult to prevent

(Could be done by physical protection)

Detect, and recover Detection can also

be a prevention, as intruder is often found

Network Attacks

Passive Threats Active Threats

Release of message content

Traffic analysis Masquerade Replay Modification of message contents

Denial of service

Global Electronic Security-Encryption Automation

Automation of Tx and Rx is done through encryption This ensures authenticated and unique data Provides a security layer to the network

Encryption: We shall look at encryption in two ways:

• Symmetric Encryption

• Public-key Encryption (Asymmetric) Well known examples

• THWATE

• Comodo

• Both versions of Verisign SSL.

Encryption

Symmetric (Single Key): Pre-1970’s public key encryption standard Stallings (2000) says that the idea has been

used by such adversaries as Julius Caesar and the German U-Boot commanders

Requirements for symmetric encryption:• Strong algorithm to protect the key• Even if intruder access message, key should be

protected• Tx & Rx must obtain the secret key in a secret

fashion

Encryption

Symmetric (Single Key):Encryption is made up of 5 major areas:

• Plaintext: Original method before encryption• Encryption algorithm: Transforms plain text• Secret Key: Provides extra substitutions and

transformations to the Encryption Algorithm• Ciphertext: The new message that is created

to be sent• Decryption algorithm: The encryption &

secret key in reverse algorithm

Encryption

Symmetric:

Plain Text

Plain Text

Ciphertext

Encryption Algorithm

Decryption Algorithm

Adapted from Stallings (2000), Figure 18.2, page 653

Secret Key Secret Key

Encryption

Symmetric – Breaking the code: Cryptanalysis:

• Utilise analysis of the ciphertext to attempt to produce a secret key.

• Sometimes pairs two ciphertexts to attempt to deduce a common encoding

• If key is found, all future messages using that key are compromised

Brute-force:• Attempts to try every combination of secret keys

on the ciphertext to deduce the plain text.

Encryption

Stallings (2000) quotes the times for breaking a secret key as follows:

Key Size (bits) Number of alternative keys

Time required to decode at 1 Encryption per uS

Time required to decode at 1 million Encryption per uS

32 4.3 x 109 35.8 Minutes 2.15 milliseconds

56 7.2 x 1016 1142 years 10.01 hours

128 3.4 x 1038 5.4 x 1024 years 5.4 x 1018 years

168 3.7 x 1050 5.9 x 1036 years 5.9 x 1030 years

Encryption

Public Key: Biggest advancement in encryption in years –

because it use Mathematics to calculate the key.

Public key cryptography uses two keys, rather than one – hence, sometimes referred to asymmetric.

Symmetric encryption is still in use, and will continue to be

This is because of the computational overhead associated with public key encryption

Encryption

Asymmetric (Public Key): Encryption is made up of 5(6) major areas:

• Plaintext: Original method before encryption

• Encryption algorithm: Transforms plain text

• Public and Private Key: Pair of keys that have been selected for encryption. One is used as encryption, one as decryption.

• Ciphertext: The two new messages that are created to be sent, one by the public key, and one by the private key

• Decryption algorithm: The encryption & secret key in reverse algorithm

Encryption

In English:1. Each user generates a pair of keys for

encryption and decryption.

2. Each user places the public key in an accessible file. The companion private key is kept private.

3. If A wishes to send a message to B, A encrypts the message using B’s public key.

4. When B receives the message, B decrypts the message using it’s own private key. No one else can, because no-one else uses B’s private key

Digital Signatures

Confirming the source: Used extensively now due to the Internet When a digital signature is sent to the receiver,

the message is encoded using the senders private key

At the receiving end, the message should be able to be decoded using the senders public key.

If it can be decoded, it can be assumed that the sender must have made the message and it’s okay

If it can’t be decoded, it can be assumed that the sender couldn’t have made the message, and should be disposed of.

Protecting yourself

PortsOpen ports allow access to a variety

of problemsPort ScannerNanoprobeFinding an open port tells you what

services are available!Close down as many as necessary to

make the system secure.

Firewalls

Firewalls:Firewalls are used to limit or allow

connections through a networkFirewalls are gateways that provide thisThey can limit or allow connections based

on:• IP Address• Port Number

If you like firewalls are watchdogs for your computer’s open doors.

Firewall Sample:

Firewall Sample:

Security Challenges

Figure 3

Overview of Electronic Security Methods Encryption: Encoding and scrambling of messages to

prevent their access without specific authorization. Most commonly used when transferring sensitive data electronically across (e.g.) the Internet

Authentication: Providing secure mechanisms for accessing specific elements of the ecommerce system. Most common method is registration with the ecommerce system, and using usernames and passwords.

Digital signature: Digital code attached to electronically transmitted message to uniquely identify contents and sender. Implemented when receiver needs to be assured of author of message (adopted now in hardware and operating system drivers)

Digital certificate: Attachment to electronic message to verify the sender and to provide receiver with means to encode reply

Secure Electronic Transaction (SET): Standard for securing credit card transactions over Internet and other networks

References

Figures 1,2, 3 taken from Laudon.K., Laudon.P. 2002. Essentials of Management Information Systems. New Jersey: Prentice Hall.

Stallings. W. 2000. Data and Computer Communications. New Jersey: Prentice Hall