NBA Ref Scandal Warns of Single Points of Failure
Sports referees are supposed to be fair and impartial. They're not supposed to favor one team over another. And they're most certainly not supposed to have a financial interest in the outcome of a game.
Tim Donaghy, referee for the National Basketball Association, has been accused of both betting on basketball games and fixing games for the mob. He has confessed to far less -- gambling in general, and selling inside information on players, referees and coaches to a big-time professional gambler named James "Sheep" Battista. But the investigation continues, and the whole scandal is an enormous black eye for the sport. Fans like to think that the game is fair and that the winning team really is the winning team.
What sorts of systems -- IT, financial, NBA games or whatever -- are most at risk of being manipulated? The ones where the smallest change can have the greatest impact, and the ones where trusted insiders can make that change.
Of all major sports, basketball is the most vulnerable to manipulation. There are only five players on the court per team, fewer than in other professional team sports; thus, a single player can have a much greater effect on a basketball game than he can in the other sports. Star players like Michael Jordan, Kobe Bryant and LeBron James can carry an entire team on their shoulders. Even baseball great Alex Rodriguez can't do that.
Because individual players matter so much, a single referee can affect a basketball game more than he can in any other sport. Referees call fouls. Contact occurs on nearly every play, any of which could be called as a foul. They're called "touch fouls," and they are mostly, but not always, ignored. The refs get to decide which ones to call.
Even more drastically, a ref can put a star player in foul trouble immediately -- and cause the coach to bench him longer throughout the game -- if he wants the other side to win. He can set the pace of the game, low-scoring or high-scoring, based on how he calls fouls. He can decide to invalidate a basket by calling an offensive foul on the play, or give a team the potential for some extra points by calling a defensive foul. There's no formal instant replay. There's no second opinion. A ref's word is law -- there are only three of them -- and a crooked ref has enormous power to control the game.
It's not just that basketball referees are single points of failure, it's that they're both trusted insiders and single points of catastrophic failure.
These sorts of vulnerabilities exist in many systems. Consider what a terrorist-sympathizing Transportation Security Administration screener could do to airport security. Or what a criminal CFO could embezzle. Or what a dishonest computer-repair technician could do to your computer or network. The same goes for a corrupt judge, police officer, customs inspector, border-control officer, food-safety inspector and so on.
The best way to catch corrupt trusted insiders is through audit. The particular components of a system that have the greatest influence on the performance of that system need to be monitored and audited, even if the probability of compromise is low. It's after the fact, but if the likelihood of detection is high and the penalties (fines, jail time, public disgrace) are severe, it's a pretty strong deterrent. Of course, the counterattack is to target the auditing system. Hackers routinely try to erase audit logs that contain evidence of their intrusions.
Even so, audit is the reason we want open-source code reviews and verifiable paper trails in voting machines; otherwise, a single crooked programmer could single-handedly change an election. It's also why the Securities and Exchange Commission closely monitors trades by brokers: They are in an ideal position to get away with insider trading. The NBA claims it monitors referees for patterns that might indicate abuse; there's still no answer to why it didn't detect Donaghy.
Most companies focus the bulk of their IT-security monitoring on external threats, but they should be paying more attention to internal threats. While a company may inherently trust its employees, those trusted employees have far greater power to affect corporate systems and are often single points of failure. And trusted employees can also be compromised by external elements, as Tom Donaghy was by Battista and possibly the Mafia.
All systems have trusted insiders. All systems have catastrophic points of failure. The key is recognizing them, and building monitoring and audit systems to secure them.