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New Data Privacy Regulations

When Mark Zuckerberg testified before both the House and the Senate last month, it became immediately obvious that few US lawmakers had any appetite to regulate the pervasive surveillance taking place on the Internet.

Right now, the only way we can force these companies to take our privacy more seriously is through the market. But the market is broken. First, none of us do business directly with these data brokers. Equifax might have lost my personal data in 2017, but I can’t fire them because I’m not their customer or even their user. I could complain to the companies I do business with who sell my data to Equifax, but I don’t know who they are. Markets require voluntary exchange to work properly. If consumers don’t even know where these data brokers are getting their data from and what they’re doing with it, they can’t make intelligent buying choices.

This is starting to change, thanks to a new law in Vermont and another in Europe. And more legislation is coming.

Vermont first. At the moment, we don’t know how many data brokers collect data on Americans. Credible estimates range from 2,500 to 4,000 different companies. Last week, Vermont passed a law that will change that.

The law does several things to improve the security of Vermonters’ data, but several provisions matter to all of us. First, the law requires data brokers that trade in Vermonters’ data to register annually. And while there are many small local data brokers, the larger companies collect data nationally and even internationally. This will help us get a more accurate look at who’s in this business. The companies also have to disclose what opt-out options they offer, and how people can request to opt out. Again, this information is useful to all of us, regardless of the state we live in. And finally, the companies have to disclose the number of security breaches they’ve suffered each year, and how many individuals were affected.

Admittedly, the regulations imposed by the Vermont law are modest. Earlier drafts of the law included a provision requiring data brokers to disclose how many individuals’ data it has in its databases, what sorts of data it collects and where the data came from, but those were removed as the bill negotiated its way into law. A more comprehensive law would allow individuals to demand to exactly what information they have about them­—and maybe allow individuals to correct and even delete data. But it’s a start, and the first statewide law of its kind to be passed in the face of strong industry opposition.

Vermont isn’t the first to attempt this, though. On the other side of the country, Representative Norma Smith of Washington introduced a similar bill in both 2017 and 2018. It goes further, requiring disclosure of what kinds of data the broker collects. So far, the bill has stalled in the state’s legislature, but she believes it will have a much better chance of passing when she introduces it again in 2019. I am optimistic that this is a trend, and that many states will start passing bills forcing data brokers to be increasingly more transparent in their activities. And while their laws will be tailored to residents of those states, all of us will benefit from the information.

A 2018 California ballot initiative could help. Among its provisions, it gives consumers the right to demand exactly what information a data broker has about them. If it passes in November, once it takes effect, lots of Californians will take the list of data brokers from Vermont’s registration law and demand this information based on their own law. And again, all of us—regardless of the state we live in­—will benefit from the information.

We will also benefit from another, much more comprehensive, data privacy and security law from the European Union. The General Data Protection Regulation (GDPR) was passed in 2016 and took effect on 25 May. The details of the law are far too complex to explain here, but among other things, it mandates that personal data can only be collected and saved for specific purposes and only with the explicit consent of the user. We’ll learn who is collecting what and why, because companies that collect data are going to have to ask European users and customers for permission. And while this law only applies to EU citizens and people living in EU countries, the disclosure requirements will show all of us how these companies profit off our personal data.

It has already reaped benefits. Over the past couple of weeks, you’ve received many e-mails from companies that have you on their mailing lists. In the coming weeks and months, you’re going to see other companies disclose what they’re doing with your data. One early example is PayPal: in preparation for GDPR, it published a list of the over 600 companies it shares your personal data with. Expect a lot more like this.

Surveillance is the business model of the Internet. It’s not just the big companies like Facebook and Google watching everything we do online and selling advertising based on our behaviors; there’s also a large and largely unregulated industry of data brokers that collect, correlate and then sell intimate personal data about our behaviors. If we make the reasonable assumption that Congress is not going to regulate these companies, then we’re left with the market and consumer choice. The first step in that process is transparency. These new laws, and the ones that will follow, are slowly shining a light on this secretive industry.

This essay originally appeared in the Guardian.

Posted on June 8, 2018 at 6:48 AMView Comments

An Example of Deterrence in Cyberspace

In 2016, the US was successfully deterred from attacking Russia in cyberspace because of fears of Russian capabilities against the US.

I have two citations for this. The first is from the book Russian Roulette: The Inside Story of Putin’s War on America and the Election of Donald Trump, by Michael Isikoff and David Corn. Here’s the quote:

The principals did discuss cyber responses. The prospect of hitting back with cyber caused trepidation within the deputies and principals meetings. The United States was telling Russia this sort of meddling was unacceptable. If Washington engaged in the same type of covert combat, some of the principals believed, Washington’s demand would mean nothing, and there could be an escalation in cyber warfare. There were concerns that the United States would have more to lose in all-out cyberwar.

“If we got into a tit-for-tat on cyber with the Russians, it would not be to our advantage,” a participant later remarked. “They could do more to damage us in a cyber war or have a greater impact.” In one of the meetings, Clapper said he was worried that Russia might respond with cyberattacks against America’s critical infrastructure­—and possibly shut down the electrical grid.

The second is from the book The World as It Is, by President Obama’s deputy national security advisor Ben Rhodes. Here’s the New York Times writing about the book.

Mr. Rhodes writes he did not learn about the F.B.I. investigation until after leaving office, and then from the news media. Mr. Obama did not impose sanctions on Russia in retaliation for the meddling before the election because he believed it might prompt Moscow into hacking into Election Day vote tabulations. Mr. Obama did impose sanctions after the election but Mr. Rhodes’s suggestion that the targets include President Vladimir V. Putin was rebuffed on the theory that such a move would go too far.

When people try to claim that there’s no such thing as deterrence in cyberspace, this serves as a counterexample.

EDITED TO ADD: Remember the blog rules. Comments that are not about the narrow topic of deterrence in cyberspace will be deleted. Please take broader discussions of the 2016 US election elsewhere.

Posted on June 7, 2018 at 5:56 AMView Comments

Regulating Bitcoin

Ross Anderson has a new paper on cryptocurrency exchanges. From his blog:

Bitcoin Redux explains what’s going wrong in the world of cryptocurrencies. The bitcoin exchanges are developing into a shadow banking system, which do not give their customers actual bitcoin but rather display a “balance” and allow them to transact with others. However if Alice sends Bob a bitcoin, and they’re both customers of the same exchange, it just adjusts their balances rather than doing anything on the blockchain. This is an e-money service, according to European law, but is the law enforced? Not where it matters. We’ve been looking at the details.

The paper.

Posted on June 5, 2018 at 6:32 AMView Comments

E-Mail Vulnerabilities and Disclosure

Last week, researchers disclosed vulnerabilities in a large number of encrypted e-mail clients: specifically, those that use OpenPGP and S/MIME, including Thunderbird and AppleMail. These are serious vulnerabilities: An attacker who can alter mail sent to a vulnerable client can trick that client into sending a copy of the plaintext to a web server controlled by that attacker. The story of these vulnerabilities and the tale of how they were disclosed illustrate some important lessons about security vulnerabilities in general and e-mail security in particular.

But first, if you use PGP or S/MIME to encrypt e-mail, you need to check the list on this page and see if you are vulnerable. If you are, check with the vendor to see if they’ve fixed the vulnerability. (Note that some early patches turned out not to fix the vulnerability.) If not, stop using the encrypted e-mail program entirely until it’s fixed. Or, if you know how to do it, turn off your e-mail client’s ability to process HTML e-mail or—even better—stop decrypting e-mails from within the client. There’s even more complex advice for more sophisticated users, but if you’re one of those, you don’t need me to explain this to you.

Consider your encrypted e-mail insecure until this is fixed.

All software contains security vulnerabilities, and one of the primary ways we all improve our security is by researchers discovering those vulnerabilities and vendors patching them. It’s a weird system: Corporate researchers are motivated by publicity, academic researchers by publication credentials, and just about everyone by individual fame and the small bug-bounties paid by some vendors.

Software vendors, on the other hand, are motivated to fix vulnerabilities by the threat of public disclosure. Without the threat of eventual publication, vendors are likely to ignore researchers and delay patching. This happened a lot in the 1990s, and even today, vendors often use legal tactics to try to block publication. It makes sense; they look bad when their products are pronounced insecure.

Over the past few years, researchers have started to choreograph vulnerability announcements to make a big press splash. Clever names—the e-mail vulnerability is called “Efail“—websites, and cute logos are now common. Key reporters are given advance information about the vulnerabilities. Sometimes advance teasers are released. Vendors are now part of this process, trying to announce their patches at the same time the vulnerabilities are announced.

This simultaneous announcement is best for security. While it’s always possible that some organization—either government or criminal—has independently discovered and is using the vulnerability before the researchers go public, use of the vulnerability is essentially guaranteed after the announcement. The time period between announcement and patching is the most dangerous, and everyone except would-be attackers wants to minimize it.

Things get much more complicated when multiple vendors are involved. In this case, Efail isn’t a vulnerability in a particular product; it’s a vulnerability in a standard that is used in dozens of different products. As such, the researchers had to ensure both that everyone knew about the vulnerability in time to fix it and that no one leaked the vulnerability to the public during that time. As you can imagine, that’s close to impossible.

Efail was discovered sometime last year, and the researchers alerted dozens of different companies between last October and March. Some companies took the news more seriously than others. Most patched. Amazingly, news about the vulnerability didn’t leak until the day before the scheduled announcement date. Two days before the scheduled release, the researchers unveiled a teaser—honestly, a really bad idea—which resulted in details leaking.

After the leak, the Electronic Frontier Foundation posted a notice about the vulnerability without details. The organization has been criticized for its announcement, but I am hard-pressed to find fault with its advice. (Note: I am a board member at EFF.) Then, the researchers published—and lots of press followed.

All of this speaks to the difficulty of coordinating vulnerability disclosure when it involves a large number of companies or—even more problematic—communities without clear ownership. And that’s what we have with OpenPGP. It’s even worse when the bug involves the interaction between different parts of a system. In this case, there’s nothing wrong with PGP or S/MIME in and of themselves. Rather, the vulnerability occurs because of the way many e-mail programs handle encrypted e-mail. GnuPG, an implementation of OpenPGP, decided that the bug wasn’t its fault and did nothing about it. This is arguably true, but irrelevant. They should fix it.

Expect more of these kinds of problems in the future. The Internet is shifting from a set of systems we deliberately use—our phones and computers—to a fully immersive Internet-of-things world that we live in 24/7. And like this e-mail vulnerability, vulnerabilities will emerge through the interactions of different systems. Sometimes it will be obvious who should fix the problem. Sometimes it won’t be. Sometimes it’ll be two secure systems that, when they interact in a particular way, cause an insecurity. In April, I wrote about a vulnerability that arose because Google and Netflix make different assumptions about e-mail addresses. I don’t even know who to blame for that one.

It gets even worse. Our system of disclosure and patching assumes that vendors have the expertise and ability to patch their systems, but that simply isn’t true for many of the embedded and low-cost Internet of things software packages. They’re designed at a much lower cost, often by offshore teams that come together, create the software, and then disband; as a result, there simply isn’t anyone left around to receive vulnerability alerts from researchers and write patches. Even worse, many of these devices aren’t patchable at all. Right now, if you own a digital video recorder that’s vulnerable to being recruited for a botnet—remember Mirai from 2016?—the only way to patch it is to throw it away and buy a new one.

Patching is starting to fail, which means that we’re losing the best mechanism we have for improving software security at exactly the same time that software is gaining autonomy and physical agency. Many researchers and organizations, including myself, have proposed government regulations enforcing minimal security standards for Internet-of-things devices, including standards around vulnerability disclosure and patching. This would be expensive, but it’s hard to see any other viable alternative.

Getting back to e-mail, the truth is that it’s incredibly difficult to secure well. Not because the cryptography is hard, but because we expect e-mail to do so many things. We use it for correspondence, for conversations, for scheduling, and for record-keeping. I regularly search my 20-year e-mail archive. The PGP and S/MIME security protocols are outdated, needlessly complicated and have been difficult to properly use the whole time. If we could start again, we would design something better and more user friendly­but the huge number of legacy applications that use the existing standards mean that we can’t. I tell people that if they want to communicate securely with someone, to use one of the secure messaging systems: Signal, Off-the-Record, or—if having one of those two on your system is itself suspicious—WhatsApp. Of course they’re not perfect, as last week’s announcement of a vulnerability (patched within hours) in Signal illustrates. And they’re not as flexible as e-mail, but that makes them easier to secure.

This essay previously appeared on Lawfare.com.

Posted on June 4, 2018 at 6:33 AMView Comments

Friday Squid Blogging: Do Cephalopods Contain Alien DNA?

Maybe not DNA, but biological somethings.

Cause of Cambrian explosion—Terrestrial or Cosmic?“:

Abstract: We review the salient evidence consistent with or predicted by the Hoyle-Wickramasinghe (H-W) thesis of Cometary (Cosmic) Biology. Much of this physical and biological evidence is multifactorial. One particular focus are the recent studies which date the emergence of the complex retroviruses of vertebrate lines at or just before the Cambrian Explosion of ~500 Ma. Such viruses are known to be plausibly associated with major evolutionary genomic processes. We believe this coincidence is not fortuitous but is consistent with a key prediction of H-W theory whereby major extinction-diversification evolutionary boundaries coincide with virus-bearing cometary-bolide bombardment events. A second focus is the remarkable evolution of intelligent complexity (Cephalopods) culminating in the emergence of the Octopus. A third focus concerns the micro-organism fossil evidence contained within meteorites as well as the detection in the upper atmosphere of apparent incoming life-bearing particles from space. In our view the totality of the multifactorial data and critical analyses assembled by Fred Hoyle, Chandra Wickramasinghe and their many colleagues since the 1960s leads to a very plausible conclusion—life may have been seeded here on Earth by life-bearing comets as soon as conditions on Earth allowed it to flourish (about or just before 4.1 Billion years ago); and living organisms such as space-resistant and space-hardy bacteria, viruses, more complex eukaryotic cells, fertilised ova and seeds have been continuously delivered ever since to Earth so being one important driver of further terrestrial evolution which has resulted in considerable genetic diversity and which has led to the emergence of mankind.

Two commentaries.

This is almost certainly not true.

As usual, you can also use this squid post to talk about the security stories in the news that I haven’t covered.

Read my blog posting guidelines here.

Posted on June 1, 2018 at 4:24 PMView Comments

1834: The First Cyberattack

Tom Standage has a great story of the first cyberattack against a telegraph network.

The Blanc brothers traded government bonds at the exchange in the city of Bordeaux, where information about market movements took several days to arrive from Paris by mail coach. Accordingly, traders who could get the information more quickly could make money by anticipating these movements. Some tried using messengers and carrier pigeons, but the Blanc brothers found a way to use the telegraph line instead. They bribed the telegraph operator in the city of Tours to introduce deliberate errors into routine government messages being sent over the network.

The telegraph’s encoding system included a “backspace” symbol that instructed the transcriber to ignore the previous character. The addition of a spurious character indicating the direction of the previous day’s market movement, followed by a backspace, meant the text of the message being sent was unaffected when it was written out for delivery at the end of the line. But this extra character could be seen by another accomplice: a former telegraph operator who observed the telegraph tower outside Bordeaux with a telescope, and then passed on the news to the Blancs. The scam was only uncovered in 1836, when the crooked operator in Tours fell ill and revealed all to a friend, who he hoped would take his place. The Blanc brothers were put on trial, though they could not be convicted because there was no law against misuse of data networks. But the Blancs’ pioneering misuse of the French network qualifies as the world’s first cyber-attack.

EDITED TO ADD (6/13): More details.

Posted on May 31, 2018 at 1:23 PMView Comments

Sidebar photo of Bruce Schneier by Joe MacInnis.