550,000-strong army of Mac zombies spreads across world

The Mac-specific Flashback Trojan created a zombie army of 550,000 Mac machines by exploiting a Java hole that Apple only patched on Tuesday, six weeks after Microsoft plugged it up on Windows machines.

This is according to Russian anti-virus firm Dr Web, which arrived at the figure after it successfully managed to sinkhole one of the command-and-control servers used to control Mac machines hit by the latest attack. The legions of compromised zombies were mostly located in the US (56.6 per cent, or 303,449 infected hosts), Canada (19.8 per cent, or 106,379 infected computers) and the UK (12.8 per cent or 68,577 cases of infection).

The Flashback malware was capable of installing itself on unprotected Mac machines without user interaction, a factor that goes a long way in explaining the success of its spread. Users become infected simply by visiting a site loaded with exploit code, in drive-by-download-style attacks.

“Systems get infected with BackDoor.Flashback.39 after a user is redirected to a bogus site from a compromised resource or via a traffic distribution system. JavaScript code is used to load a Java-applet containing an exploit,” Dr Web explains.

The malware establishes a back door on compromised systems for the subsequent download of additional cyber-bugs.

Additional payloads downloaded by the malware included a data-stealing Trojan that attempts to lift passwords and banking information from Safari as well as a search-hijacking tool.

The later utility was probably designed to power click-fraud scams or to redirect victims towards scareware portals, net security firm Sophos notes.

Attackers first began to exploit two earlier Java vulnerabilities (CVE-2011-3544 and CVE-2008-5353) to spread malware in February 2012, before switching to another exploit (CVE-2012-0507) on 16 March – to devastating effect. ®

Article source: http://go.theregister.com/feed/www.theregister.co.uk/2012/04/05/flashback_trojan_botnet/

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INSIDE GCHQ: Welcome to Cheltenham’s cottage industry

GCHQ Benhall doughnut aerial view

Geek’s Guide to Britain For staff at the Government Communications Headquarters (GCHQ) in Cheltenham, there’s an air of Fight Club about the place. The first rule about GCHQ is you don’t talk about GCHQ.

It’s a well observed tradition, even though there are road signs and a bus route directing you to this highly secret establishment, the nerve centre of Britain’s communications surveillance operations.

GCHQ Benhall … does a doughnut keep better secrets? Source: Bing Maps/Digital Globe

The design of the doughnut-shaped building at Benhall has attracted a fair share of attention since its completion in late 2003. Indeed, if you take a look at the site from Google Earth, you might wonder if it inspired Steve Jobs’ plans for a new circular Apple building – a company that also likes to keep secrets.

Benhall is now the primary home of GCHQ and the majority of the service’s 5,300 employees are based here. The organisation’s own website describes itself as “one of the three UK Intelligence Agencies and forms a crucial part of the UK’s National Intelligence and Security machinery”. The other two are the Security Service (MI5) and the Secret Intelligence Service (MI6).

In years gone by, GCHQ in Cheltenham was spread over two sites a few miles apart: Oakley and Benhall. The Oakley site has largely given way to a housing development although some buildings remain with the barbed wire fence rather menacingly separating it from a kids’ play area on the new estate. While undoubtedly unintentional, this incongruousness does appear strangely Soviet – it’s perhaps fitting given Cold War concerns became GCHQ’s raison d’être in the 1950s.

GCHQ Oakley … recreation and razor wire live side by side these days

I was born into a GCHQ family as my parents met there. As I write, it now occurs to me that if GCHQ didn’t exist, neither would I. Spooky. I lived in a GCHQ house, too – purpose built to accommodate the growing workforce – and I could see Benhall’s satellite dishes from my bedroom window.

I worked there too, and before I tread further along this telecommunications taboo tightrope I should mention to our colonial cousins that what we have here is the equivalent of America’s National Security Agency (NSA). For me, this association came in handy when applying for a US visa to visit a GCHQ colleague working for that ultra-hush-hush outfit. Mentioning those three initials at the US Embassy had my passport visa stamp in seconds.

Incidentally, I did ask the GCHQ press office if there was any chance of a tour of the building or even some publicity pictures of the interior. Admittedly, there was a bit of wishful thinking behind the former – there were employee family tours when the building was complete – but the answer was no. The polite response to the latter request was that pictures would be considered on condition the article could be viewed before publication. That’s against our editorial policy, but chances are they’ve done that already.

Official Secrets Act warning

and that’s just the car park

I decided to take some photos myself, which are no more intrusive than those found on Google Streetview. It was only later that I spotted a “no photographs” sign, but as I was some distance away, I didn’t notice it at first. I doubt I’d notice if I’m now being followed or having my communications tampered with as a result, but it would seem like a waste of time and of public money.

If you do go on a tour of ‘Nam, taking pics aplenty up to the wire wouldn’t be a very good idea. The security staff, many of which are ex-servicemen, take a dim view of this sort of thing.

Choosing Cheltenham

As part of my research for this piece, I dug up Peter Freeman’s 34-page booklet titled How GCHQ came to Cheltenham, which lays out a longer story than I’d anticipated. Freeman details the early years and the decision-making process that saw this sleepy Cotswold town – that for 75 years up to 1945 had a static population of 50,000 – undergo significant changes when GCHQ became operational. The population swelled by 20 per cent in the 1950s with a housing programme in place to support Cheltenham’s new cottage industry: intelligence gathering.

Freeman remarks that the Ministry of Health’s initial views were that “Cheltenham did not want civil servants and already had plenty of local employment”. The Ministry of Works leaned on the Ministry of Health and consequently the town now breeds civil servants.

Early GCHQ history by staffer Peter Freeman

I was reading an exclusive edition of Freeman’s work which features various handwritten corrections and additional detail courtesy of my mother, and she would know being on the 1950s-era Foreign Office recruitment team based above the Ministry of Food bureau in Clarence Street, Cheltenham (rationing was still in operation in post-war Britain). Their task was to find the right stuff to staff Oakley and Benhall.

Yet how GCHQ came to Cheltenham owes more to what the Americans left behind after World War II than any strategic importance to the spa town’s location. The Oakley and Benhall sites were purchased by the Ministry of Works in 1939 and building works began for the purpose of housing government departments if an evacuation from London’s Whitehall became necessary. During the Blitz, some ministries had to move fast and ended up arriving before work on the temporary office blocks was complete. Each site had six of these utilitarian, single storey, 12-spur buildings that, in total, clocked up over 400,000sq ft of office space.

With the Blitz over, various departments returned to London, and the Americans, now involved in the war, found themselves at these two sites running a major HQ. The US SOS (Services of Support) dealt with logistics for the European Theatre of Operations, US Army (ETOUSA), and the buildings were used as offices for this communications hub. According to Freeman, the Americans arrived in secret and those coming from London had exclusive trains laid on to keep their movements under wraps. The railway staff at Paddington weren’t so clued up though, and slapped up signs on the platform saying “US Forces To Cheltenham”. As the Yanks dug in at ‘Nam, they consequently installed a substantial network of landlines which remained after the war.

US Forces in covert UK transportation ops … lucky they kept this quiet

Source: HyperWar

The clincher was when Cheltenham was visited by a staffer from GCHQ – then based at Bletchley Park near Milton Keynes – who knew of the site at Benhall, which was where the Ministry of Pensions had taken residence prior to an eventual move to Blackpool. Posing as an Admiralty official on a pensions fact-finding mission, he was granted a tour of the site and wrote up a favourable report of the place. Although there would be numerous inter-departmental and financial wrangles to follow, GCHQ eventually made its home in Cheltenham in the early 1950s.

Next page: The great British code warriors

Article source: http://go.theregister.com/feed/www.theregister.co.uk/2013/05/24/geeks_guide_gchq/

Did Kim Dotcom invent 2-factor authentication? Er, not exactly…

Twitter is the latest major web service to beef up its security two-factor authentication (2FA). The security feature is a pretty simple and effective approach – and one the notorious Mega kingpin Kim Dotcom claims today to have invented back in the ’90s.

Two-factor auth is a simple process for verifying that the user accessing a service is legitimate. A random code is sent from the web service (via SMS) to the person’s phone, and the user then types the code into an authentication dialog on a web page.

But did Dotcom really invent 2FA for remote authentication? In short, it appears he did not.

In 1996, the then-Kim Schmitz filed for a patent entitled “Method for authorizing in data transmission systems”. The patent has a priority date of 29 April 1997, and it does indeed describe a two-factor authentication system. The user logs into a service, triggers a secondary authentication request, and this is fulfilled by SMS.

But Ericsson filed a patent titled “User authentication method and apparatus” with a priority date of 24 June 1994 that also covered 2FA using a pager or phone. A later patent filed by Nokia ["Method for obtaining at least one item of user authentication data"] with a priority date of 23 February 1996 resembles even more closely the 2FA approach used on the web today.

Kim Dotcom’s patent through the European Patent Office was cancelled in 2011 after opposition from Ericsson.

Kim Dotcom’s US patent remains in force. Whether the US Patent Office or the United States District Court of Texas would confirm the validity of the patent is an interesting question.

On his Twitter page, Kim Schmitz/Dotcom describes himself an “innovator”. To earn the title, you’ve got to introduce something new. Kim Schmitz/Dotcom – in this case at least – doesn’t appear to have done so.®

Article source: http://go.theregister.com/feed/www.theregister.co.uk/2013/05/24/kim_dotcom_2fa_no/

Microsoft exposes green users’ privates in web quiz snafu

Microsoft has plugged a flaw in its Greener IT Challenge website that leaked the names and email addresses of users who took a quiz on the site.

Users who passed the quiz by demonstrating their knowledge of buying environmentally sensitive PCs, choosing minimal power use options for new computers and how to dispose of obsolete IT kit safely were given a certificate.


The certificate is displayed at the end of the multiple-choice test, at which point a PDF version can be downloaded for printing.

However some “bad form” web-design meant that these PDF versions of the certificates were allocated in numerical order, on an unencrypted website open to world+dog. It would have been a simple matter for spammers or other miscreants to run a script and harvest hundreds of email addresses. The information might then be usable in spam runs or (worse) phishing campaigns.

In a statement, Microsoft told El Reg that the problem was “fully resolved”.

“We have now resolved this issue so all users are anonymous and their information is private,” it said.

In fairness to Microsoft we’re only talking about email addresses and names here, and not highly sensitive information like credit card numbers. Nonetheless, people are entitled to hold Microsoft to high standards in web design; something it (or a third-party agency acting in its name) failed to live up to on this occasion. ®

Bootnote

A hat tip to Reg reader Marc for his “quick tip on some ‘bad form’ web-design,” as he put it.

Article source: http://go.theregister.com/feed/www.theregister.co.uk/2013/05/24/ms_greener_it_test_spam_snafu/

Feds slam hacker-friendly backdoors in jalopy, grub factories

Security researchers have uncovered hard-coded user accounts that could act as backdoors into food, car, and agricultural production systems across the world.

The flaw, which allows attackers to launch remote exploits, was found in a pair of industrial control devices.


The security hole was found in the BL20 and BL67 Programmable Gateways made by German firm Turck. The kit is used across many industries – including agriculture and food, automotive and manufacturing – to control industrial plant equipment in the United States, Europe and Asia.

Left unresolved, the flaw might be used by hackers to shut down production lines or otherwise create havoc on systems managed with the vulnerable controllers.

The Industrial Control Systems Cyber Emergency Response Team (ICS-CERT) published an advisory notice providing links to updated firmware from Turck that mitigates against possible attacks.

The firmware update removes the hard-coded accounts accessible by the FTP service, thus preventing attackers from remotely accessing the device by using hard-coded credentials.

No known public exploits specifically target the vulnerability. However attackers with only minimal skill could potentially carry out an attack, ICS-CERT warns.

The flaws were uncovered by IOActive Labs, whose advisory (PDF) explains that the security snafu created a ready means to plant malware on insecure kit.

This vulnerability allows an attacker to remotely access the device, via its embedded FTP server, by using the undocumented hard-coded credentials. Thus, the attacker can install a trojanized firmware to control communications and processes.

This malicious code may create false communication between remote I/Os, PLCs, or DCS systems in order to compromise additional devices, disrupt legitimate services, or alter industrial processes.

Ruben Santamarta, the IOActive security consultant who unearthed the bugs, explained that the unaddressed flaw left the devices wide open to hackers who happened to know the default login credentials for the kit.

“These hard-coded user accounts pose a significant threat to organisations that have deployed the vulnerable Turck devices,” he said. “Any attacker with knowledge of the credentials can effectively remotely control the devices and reap havoc on the network – easily disrupting or shutting down critical production lines.”

“Affected organisations should immediately apply the updated firmware from Turck to remove these backdoors,” he added.

Santamarta added that the presence of the backdoors in industrial control kit is sadly typical of insecure product development across the sector.

“It is both surprising and disappointing that hard-coded user accounts like these continue to crop up in Industrial Control Systems. Vendors and purchasers of such critical technologies should take great care to ensure that similar vulnerabilities do not affect future product lines. The industry as a whole still has a long way to go in implementing secure development lifecycle principles,” he added. ®

Article source: http://go.theregister.com/feed/www.theregister.co.uk/2013/05/24/turck_industrial_control_backdoor/

Google to double encryption key lengths for SSL certs by year’s end

Google is about to start the first upgrade to its SSL certification system in recent memory, and will move to 2048-bit encryption keys by the end of 2013. The first tranche of changes is planned for August 1.

The new requirements are laid out in a blog post and a FAQ on the topic. The upgrade, based on the guidelines from National Institute of Standards and Technology (NIST), will also see Google’s root certificate for signing all of its SSL certificates getting an upgrade from a 1024-bit key.


“There aren’t immediate concerns about these certificates being cracked,” a Google spokesman told El Reg, “but updating them now provides much better defense against any future risks.”

The upgrade is required because NIST thinks it’s technically possible that the standard could be broken pretty soon. The first reported factorization of a 768-bit RSA modulus came in December 2009, when an international team of computer scientists and cryptographers spent two-and-a-half years dedicating themselves to the task.

“A 1024-bit RSA modulus is still about one thousand times harder to factor than a 768-bit one,” the researchers reported. “If we are optimistic, it may be possible to factor a 1024-bit RSA modulus within the next decade.

“We can confidently say that if we restrict ourselves to an open community, academic effort as ours and unless something dramatic happens in factoring, we will not be able to factor a 1024-bit RSA modulus within the next five years. After that, all bets are off.”

NIST estimates it would take six or seven years for any attempt to have a realistic chance of success at breaking 1,024-bit keys, based on the speed of processor development and improvements in factoring computation.

That said, it’s still an estimate, and NIST had wanted to get the changeover done faster, with 2010 picked as the original transition date. But because the 1,024-bit standard was so ubiquitous, the schedule was pushed back until the end of this year.

It’s the first time anyone can remember the SSL encryption keys getting changed at Google, and it’s a measure of the power and sophistication of computer processors that the update is needed. Barring some breakthrough in quantum computing or coding practice, it should be some years before another upgrade is required. ®

Article source: http://go.theregister.com/feed/www.theregister.co.uk/2013/05/23/google_upgrade_ssl_certificates_schedule/

Brit spooks bugged Edward VIII’s phones, records reveal

Journalist's telegram about Edward VIII's abdication

Intelligence files kept hidden for nearly 80 years have shown that the British government was bugging King Edward VIII’s phones in the days leading up to his abdication.

Neil Forbes Grant’s telegram confirming the King’s abdication.

Government officials were clearly panicking about what Edward would do and how the news would be received, so they monitored calls from Buckingham Palace and the King’s Windsor residence Fort Belvedere, as well as stopping telegrams leaking the news of his abdication and intimidating journalists to keep a lid on the news.

The London editor of the Cape Times, Neil Forbes Grant, was dragged in to face Home Secretary Sir John Simon after sending a telegram to South Africa on 6 December, 1936 saying that the King was going to give up the throne. The missive was one of two the General Post Office had intercepted with the leaked news.

Sir John lambasted Grant, reminding him that a false rumour that the country had lost the Battle of Waterloo in 1815 caused a financial crisis and ruined many people, and tried to pressure him to reveal his “highly placed source”.

“I asked him if he did not realise that his responsibilities as a journalist and an Englishman made the sending of such a message without definite authority as to its truth very improper and reckless,” Simon wrote.

Grant refused to give up his source and Simon relented, asking him to keep the interview “absolutely secret and between ourselves”. He also told Grant that there was “no truth” to the abdication rumour.

Edward abdicated at Fort Belvedere four days after Grant sent the telegram.

The papers come from a pile of documents deemed too sensitive and “difficult” to be stored in the classified section of the National Archives. Instead they were kept in a locked vault under the Cabinet Office.

Released through the National Archives, the collection shows the government’s frantic attempts to control the situation as Edward prepared to give up his throne to marry Mrs Wallis Simpson, an American divorcee and socialite. Edward, as head of the Church of England, could not marry Wallis while her former husband still lived – but he refused to give her up. In response, Sir John asked the GPO to monitor the King’s phone calls from 5 December, 1936.

The papers also show that the King himself asked the police to guard Simpson’s residence overlooking Regent’s Park a few months before his abdication. Edward asked Chief Inspector Storries to help make Simpson’s house “burglar proof” and to take steps to stop her from being “annoyed by pressmen, press photographers and other curious persons”. He also asked Storries to keep the instructions to himself.

A sketch of Chf Insp Storries’ security arrangements around Wallis Simpson’s house

Among the documents was a handwritten diagram of the stepped-up patrol around Simpson’s house, which police later had to deny the existence of when questioned by American newspapermen.

Other papers released by the Cabinet Office outline a drunken night during Winston Churchill’s August 1942 mission to Moscow and his first face-to-face meeting with Soviet dictator Josef Stalin. Sir Alexander Cadogan, permanent under-secretary at the Foreign Office, was along for the trip and later wrote to Viscount Halifax that things weren’t going that well until Churchill got Stalin alone.

“Nothing can be imagined more awful than a Kremlin banquet, but it has to be endured. Unfortunately, Winston didn’t suffer it gladly. However, next morning, he was determined to fire his last bolt, and asked for a private talk, alone, with Stalin,” he wrote.

At around 1am, Cadogan was called to Stalin’s private rooms and found the war leaders a little worse for wear.

“There I found Winston and Stalin, and Molotov who has joined them, sitting with a heavily-laden board between them: food of all kinds crowned by a sucking [sic] pig, and innumerable bottles,” he said.

“What Stalin made me drink seemed pretty savage: Winston, who by that time was complaining of a slight headache, seemed wisely to be confining himself to a comparatively innocuous effervescent Caucasian red wine. Everyone seemed to be as merry as a marriage bell.

“I think the two great men really made contact and got on terms, Certainly, Winston was impressed and I think that feeling was reciprocated … Anyhow, conditions have been established in which messages exchanged between the two will mean twice as much, or more, than they did before.” ®

Article source: http://go.theregister.com/feed/www.theregister.co.uk/2013/05/23/british_government_spied_on_own_king_cabinet_office_papers/

New York cop in alleged love-polyhedron email hack spree

A New York detective allegedly hired hackers to spy on 19 fellow cops and at least 11 others – apparently in a bid to discover if any of them were sleeping with his ex.

Edwin Vargas, a 42-year-old Bronx investigator, is accused of spending $4,050 on an email-hacking service to obtain the usernames and passwords for 43 message inboxes in, it is believed, an obsessive quest to keep tabs on his former girlfriend.


He was arrested on Tuesday and appeared before a magistrate judge charged with conspiracy to commit computer hacking.

The detective, of Bronxville, New York, it is claimed, had suspected his ex-lover, with whom he had split after they had a child together, had started a new relationship with a fellow officer. The veteran cop of 20 years handed over between $50 and $250 to unnamed hackers for the login details of each inbox, it is claimed.

Vargas accessed at least one of his fellow cops’ accounts, the Feds said. He is also charged with unlawfully accessing the National Crime Information Center (NCIC) database by allegedly running unauthorised checks on two serving officers.

The prosecution also accused Vargas of paying hackers to snoop on the records of a mobile phone account belonging to one of his targets, as an FBI statement on the case explained:

After receiving the log-in credentials he had purchased from the e-mail hacking services, Vargas accessed at least one personal e-mail account belonging to a current NYPD officer. He also accessed an online cellular telephone account belonging to another victim. Vargas paid a total of more than $4,000 to entities associated with the e-mail hacking services.

An examination of the contents of the hard drive from Vargas’ NYPD computer revealed, among other things, that the Contacts section of his Gmail account included a list of at least 20 e-mail addresses, along with what appear to be telephone numbers, home addresses, and vehicle information corresponding to those e-mail addresses, as well as what appear to be the passwords for those e-mail addresses.

Vargas was released on bail after posting a $50,000 bond. Each of the two charges against him, allegedly committed between March 2011 and October 2012, carries a maximum sentence of one year in prison if he is convicted. “The charges contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty,” the Feds added in their joint statement with Manhattan’s US attorney.

At this stage, the officials omitted any mention of a motive for Vargas’ alleged wrongdoing but the New York Daily News, like the New York Times, claimed the suspect was motivated by a desire to spy of the mother of his three-year-old son. ®

Article source: http://go.theregister.com/feed/www.theregister.co.uk/2013/05/23/nypd_black_hat/

Tipsters exposed after South Africa’s national police force hacked

The identities of more than 15,000 South Africans who reported crimes or provided tip-offs to the police have been exposed following an attack on a SAPS (South African Police Service) website.

The names and personal details of whistleblowers and crime victims were lifted from www.saps.gov.za and uploaded to a bullet-proof hosting site.


Names, phone numbers, email addresses and ID numbers of people who thought they had been providing information in confidence and anonymously have been spaffed on the net.

The data dump includes information on 15,700 individuals who used the website from 2005, according to eNews Channel Africa, the local news service that broke the story of the leak. Usernames and passwords of around 40 SAPS personnel were also leaked.

The South African cops initially denied anything was amiss before confirming the breach after eNCA reporters had spoken to a number of individuals named in the data dump.

“Complaints range from rape cases opened in Durban to police brutality in Port Elizabeth,” the news service reports.

“Also on the list are ordinary South Africans asking for help in cases involving vehicle theft and illegal shebeens*. People have also complimented police on their work, including speedy responses to emergencies and help in cases.”

Safety concerns

One tipster – who had made a complaint about police brutality – expressed concerns about her safety in the wake of the breach. Daily newspaper The Star also spoke to someone who had complained to the police about a lack of apparent progress in the investigation of the rape of a 14 year-old girl. The complainant, who remained anonymous in The Star report, is clearly concerned about the safety of the victim.

A previous obscure hacker crew called @DomainerAnon, which claims an affiliation with loosely knit hacktivist collective Anonymous, claimed responsibility for the attack, which it said was pulled off using a SQL injection attack.

The group tweeted: “A message to SAP: You are responsible for the data you hold…. we have merely shown that you do not live up to your own Code of Conduct!”

Payback… but who’s paying?

The attack was apparently motivated by a protest against the death of 34 people when police opened fire on striking miners at the Marikana platinum mine last August.

The potential for collateral damage from @DomainerAnon’s actions is obvious, but the self-declared lone wolf group dismissed suggestions that it was potentially putting the lives of innocents and whistleblower on the line to further its political agenda in exchanges on Twitter (here and here).

In an interview with MyBroadband, a member of DomainerAnon attempting to justify the decision to release the stolen data said. “I laughed when I was accused of ‘blowing’ covers of so-called whistle-blowers,” Domainer said. “I read one email which complained to the police of their lack of service. Another mail reported their missing cat!”

It’s not the first time hacktivists have published personal details of private citizens from leaked websites to “embarrass the authorities”.

In June 2011, LulzSec released a number of documents pertaining to the Arizona Department of Public Safety.

Leaked data including email addresses and passwords of immigrants, as well as potentially sensitive police documents was dumped online in a protest against Arizona laws requiring those immigrants to carry documents at all times. Police officials at the time expressed concerns that leaked information on how Arizona cops combat gangs – as well as lists of some of the officers’ identities – put the lives of police at risk. ®

* Makeshift drinking taverns where often illegally brewed alcohol is consumed.

Article source: http://go.theregister.com/feed/www.theregister.co.uk/2013/05/23/saps_anon_hack/

Spam and the Byzantine Empire: How Bitcoin tech REALLY works

Analysis Why does Bitcoin work? Fraudsters should have left it in cinders years ago, and might have done, if it wasn’t for two things: spam and the Byzantine Empire.

A Bitcoin is basically an entry in a ledger that is distributed across a network of computers. Bitcoins are transferred between parties by noting the transaction in the ledger. This might sound just like any other banking system except there’s a crucial difference: no one is in charge of the ledger.

It’s held across a network of computers and anyone can add their computer to the network when they wish – or leave when they wish. This may seem crazy, and an easy way for fraudsters to join the network and get their computer to update the ledger to give themselves new Bitcoins.

In 1997, a British cryptographer called Adam Back proposed an anti-spam approach called Hashcash. The basic idea was to make an email message contain proof that a computationally difficult problem, specific to the contents of the message, had been solved. Any email that didn’t contain this proof would be discarded by the recipient’s email server.

Ordinary users of email wouldn’t be inconvenienced because the amount of work for one email message would be tolerable, but spammers would be deterred because it would add up to a huge amount of money, in the form of the huge electricity bill run up by all the computers they’d need to buy to solve the mathematical problems.

In the end it didn’t work out as an anti-spam technique partly because spammers today use botnets, which are vast armies of hijacked computers. But the idea behind Hashcash was picked up and used for Bitcoin.

Coining it … how does Bitcoin stack up against national currencies?

The nitty-gritty detail of the crypto-currency

The basic idea behind Bitcoin is that blocks of transactions are chained together, each new block of transactions referring to the previous one. A block is validated by having a value computed for it that matches the hash signature of the block, with the difficulty of the matching calibrated automatically by the network. As members of the network get faster (using faster computers or entirely new generations of hardware engineered specifically for the task), the computation gets more difficult. It is designed to always take about ten minutes to match the hash.

A block cannot be altered without once again performing the computation and adding the proof-of-work to it. But crucially, this must then also be repeated for the block that was chained to it (since the proof of work for that block now will not match). It is a little like trying to alter a company’s accounts from a few years back: the balance sheet and profit-and-loss statements won’t tally forward properly, so each subsequent year will have to be changed too.

Stopping the fraudsters in their tracks

Historian William Lecky wrote in 1869 of the Byzantine Empire: “The universal verdict of history is that it constitutes, without a single exception, the most thoroughly base and despicable form that civilization has yet assumed.” Harsh, certainly. Byzantine has become a byword for treachery – and it is the basis for a classic problem in computer science: the Byzantine Generals Problem.

This challenge involves working out how to reach a valid consensus among a set of military generals when some of them are traitors and will send fraudulent messages. This is exactly the problem Bitcoins must face on the internet. The solution to the problem is voting. The Bitcoin network maintains the integrity of its ledger by the loyal members collectively outvoting traitors.

If a traitor computer tries to alter a transaction (undoing a payment to take back the money, for example) then it must also alter the transactions in blocks that came after. But because of the Hashcash approach this is computationally challenging and painfully slow, and by the time it has done this more blocks will have been chained by the rest of the network.

Thus, it is futile for a fraudster to compete with the rest of the Bitcoin network unless he can outpace it.

The wretched hive of scum and villainy on the internet generally cannot nobble the currency: even if they amassed a huge botnet of a million hijacked Windows machines it would be unlikely to exceed 6TH/s (trillion hash operations per second) yet the Bitcoin network is currently running at 58TH/s. Furthermore the performance of the Bitcoin network is set to grow quickly as dedicated chips (ASICs in other words) in Bitcoin mining rigs push PCs into obsolescence – and these rigs do not run Windows. There remains a risk that a well-funded organization (perhaps governmental) could amass the dedicated computing power required to swamp the Bitcoin network.

Defending against this risk is one of the motivations of engineers such as Yifu Guo at Avalon to get ASICs widely adopted.

Next page: Can you keep a secret? Bitcoin doesn’t

Article source: http://go.theregister.com/feed/www.theregister.co.uk/2013/05/23/bitcoin_spam_byzantine_generals/

Aha, I see you switched on your mobile Wi-Fi. YOU FOOL!

Security expert Raul Siles has warned that years after it was first identified, the Preferred Networks List (PNL) Wi-Fi bug remains unaddressed on many an iPhone, Android phone, and Windows or BlackBerry handset.

The problem itself is simple enough, reports HelpNet Security. When searching for networks, a poor Wi-Fi implementation can result in a device exposing its PNL list to eavesdroppers. This could allow an attacker to spoof one of the network that appears on the user’s list, becoming the vector for a man-in-the-middle attack.


PNL disclosure remains a problem in Android 2, 3 and 4, may occur when users add networks manually in iOS 1-6, and in BlackBerry 7, according to Siles. It has also been fixed in some versions of Windows Mobile.

Some mobile operating systems (BlackBerry, for example) give users enough control that the problem can be fixed manually – but only, Siles said, if the user knows there’s a problem and knows how to fix it.

Given the growing popularity of BYOD in the business environment, there’s the added danger of a fake preferred network being used to capture corporate logins. System administrators need to ensure that devices hide Wi-Fi network data (where this is possible), and Siles called for Android to be upgraded to allow users to hide new networks.

Siles adds:

I need to stress that these types of client attacks are commonly left unchecked and without consideration, the modern smartphone could become the ultimate digital “Trojan Horse”, allowing attacks to breach ultra-secure locations.

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Article source: http://go.theregister.com/feed/www.theregister.co.uk/2013/05/23/wifi_pnl_bug_unpatched/