The Under Armour breach provides lessons in the do’s and don’ts of enterprise cybersecurity and compliance with the EU GDPR

Last week, athletic apparel manufacturer Under Armour announced that its popular MyFitnessPal weight loss and fitness tracking app had been hacked, compromising 150 million accounts. The Under Armour breach is the largest data breach so far this year and ranks among the top five to date. It also makes a good case study in the do’s and don’ts of enterprise cybersecurity. Let’s examine the lessons enterprises can take away from the Under Armour breach and its fallout, especially as the deadline for the EU GDPR approaches on May 25.

If a breach does happen, prompt disclosure is crucial.

The Under Armour breach was discovered on March 25 and disclosed only four days later; compare this to Equifax, which waited several weeks to notify users it had been hacked (and then chose to do so while the nation’s attention was focused on Hurricane Irma), and Uber, which waited more than a year (after attempting to cover the breach up). Prompt disclosure is going to be even more important under the GDPR, which will require organizations to report breaches within 72 hours.

Segment your data, and collect only the data you need.

The Under Armour breach involved only user names, email addresses, and encrypted passwords. The MyFitnessPal app does not collect Social Security numbers or other government identifiers, and payment information is stored separately, in a part of the system the hackers did not breach.

The GDPR requires organizations to bake data security into their products, policies, procedures, and systems from day one. While network segmentation alone does not constitute data security, it goes a long way towards demonstrating due diligence.

The GDPR will also require organizations to provide users with a plain-language explanation of what user data they are collecting and what they intend on doing with it. If you don’t absolutely need a particular piece of personal information to conduct your business, don’t collect it.

Properly encrypt and salt user passwords.

This is where Under Armour dropped the ball. The company states that while “the majority” of the compromised passwords were hashed using the robust bcrypt hashing function, at least some of the passwords were hashed using the notoriously hackable SHA-1 function. Under Armour has not disclosed why only some of the passwords were encrypted with bcrypt. It also has not specified whether the bcrypt-hashed passwords were salted for extra protection, which involves appending random data that is unique to each user and saving it along with their password.

To properly protect user passwords and fulfill the security requirements of the GDPR, make sure you are using a robust hashing function and salting user passwords. As strong as bcrypt is, it is not unbreakable; the Ashley Madison hack involved 36 million passwords hashed using bcrypt.

Do not reuse passwords.

Although the Under Armour breach yielded “only” email addresses and login credentials, not payment data or sensitive personal data like Social Security Numbers, a lot of people use the same set of login credentials on multiple sites. Armed with these credentials, hackers could attempt to use them on banking, shopping, or social media sites and to access victims’ email accounts. This underscores the importance of using a different, strong password for every system, website, and app.

If you have a MyFitnessPal account, you should log in and change your password right now. If you reused your MyFitnessPal password on any other sites, make sure to change those, too.

The cybersecurity experts at Lazarus Alliance have deep knowledge of the cybersecurity field, are continually monitoring the latest information security threats, and are committed to protecting organizations of all sizes from security breaches. Our full-service risk assessment services and Continuum GRC RegTech software will help protect your organization from data breaches, ransomware attacks, and other cyber threats.

Lazarus Alliance is proactive cybersecurity®. Call 1-888-896-7580 to discuss your organization’s cybersecurity needs and find out how we can help your organization adhere to cybersecurity regulations, maintain compliance, and secure your systems.

Mueller indictments of Russian cyber criminals put election hacking at top of mind

State officials expressed grave concerns about election hacking the day after Special Counsel Robert Mueller handed down indictments of 13 Russian nationals on charges of interfering with the 2016 presidential election. The Washington Post reports:

At a conference of state secretaries of state in Washington, several officials said the government was slow to share information about specific threats faced by states during the 2016 election. According to the Department of Homeland Security, Russian government hackers tried to gain access to voter registration files or public election sites in 21 states.

Although the hackers are not believed to have manipulated or removed data from state systems, experts worry that the attackers might be more successful this year. And state officials say reticence on the part of Homeland Security to share sensitive information about the incidents could hamper efforts to prepare for the midterms.

Granted, the Mueller indictments allege disinformation and propaganda-spreading using social media, not direct election hacking. However, taken together with the attacks on state elections systems, it is now indisputable that Russian cyber criminals used a highly sophisticated, multi-pronged approach to tamper with the 2016 election. While there have been no reported attacks on state systems since, there is no reason to believe that election hacking attempts by Russians or other foreign threat actors will simply cease; if anything, cyber criminals are likely to step up their game during the critical 2018 midterms this November.

These aren’t new issues; cybersecurity was a top issue leading up to the 2016 election. Everyone agreed then, and everyone continues to agree now, that more needs to be done to prevent election hacking. So, what’s the holdup?

One of the biggest issues in tackling election hacking is the sheer logistics of U.S. elections. The United States doesn’t have one large national “election system”; it has a patchwork of thousands of mini election systems overseen by individual states and local authorities. Some states have hundreds, even thousands of local election agencies; The Washington Post reports that Wisconsin alone has 1,800. To its credit, Wisconsin has encrypted its database and would like to implement multi-factor authentication. However, this would require election employees to have a second device, such as a cell phone, to log in – and not all of them have work-issued phones or even high-speed internet access.

Not surprisingly, funding is also a stumbling block. Even prior to the 2016 elections, cybersecurity experts were imploring states to ensure that all of their polling places were using either paper ballots with optical scanners or electronic machines capable of producing paper audit trails. However, as we head toward the midterms, five states are still using electronic machines that do not produce audit trails, and another nine have at least some precincts that still lack paper ballots or audit trails. The problem isn’t that these states don’t want to replace their antiquated systems or hire cybersecurity experts to help them; they simply don’t have the budget to do so.

Congress Must Act to Prevent Election Hacking

Several bills that would appropriate more money for states to secure their systems against election hacking are pending before Congress, including the Secure Elections Act. Congress can also release funding that was authorized by the 2002 Help America Vote Act, but never appropriated.

The integrity of our elections is the cornerstone of our nation’s democracy. Proactive cybersecurity measures can prevent election hacking, but states cannot be expected to go it alone; cyber attacks do not respect borders.

The cybersecurity experts at Lazarus Alliance have deep knowledge of the cybersecurity field, are continually monitoring the latest information security threats, and are committed to protecting organizations of all sizes from security breaches. Our full-service risk assessment services and Continuum GRC RegTech software will help protect your organization from data breaches, ransomware attacks, and other cyber threats.

Lazarus Alliance is proactive cybersecurity®. Call 1-888-896-7580 to discuss your organization’s cybersecurity needs and find out how we can help your organization adhere to cybersecurity regulations, maintain compliance, and secure your systems.

Latest FINRA Examination Findings Reveal That Firms Have Made Progress with Cybersecurity, but Problems Remain

Cyber security remains “one of the principal operational risks facing broker-dealers,” according to the FINRA 2017 Examination Findings Report, and while progress has been made, many broker-dealer firms still have work to do to protect themselves against hackers.

Firms More Aware of Cybersecurity Risks

FINRA noted a significant uptick in firms’ awareness of cybersecurity risks, noting a substantial increase in “attention to cybersecurity challenges over the past two years, including at the executive management level.” Most of the firms FINRA examined had already established or were in the process of establishing risk management programs to address security issues. FINRA noted that firms with the most effective cybersecurity programs tended to have:

• Strong, risk-based governance structures and processes
• Conducted regular risk assessments and followed up to address areas of concern
• Conducted regular vulnerability and penetration tests
• Conducted regular employee cybersecurity training
• Conducted comprehensive cybersecurity reviews of any branch offices

But Better Risk Management & Data Governance Needed

FINRA noted that the quality of firms’ cyber risk management programs varied widely, not only from firm to firm but also within the same organization. By far, the biggest security vulnerability was firms’ own people; the most common threats observed in 2016 and 2017 were all rooted in social engineering: phishing and spearphishing schemes, ransomware (which usually begins with a phishing email), and fraudulent third-party wires (again, usually involving phishing schemes).

The agency highlighted a number of frequent problem areas:

• Access Management – Some firms didn’t adhere to basic procedures such as terminating system access for former employees and monitoring systems for anomalies, such as logins from unusual locations or privileged users granting themselves additional, unwarranted system privileges.
• Risk Assessments – Despite the importance of regular risk assessments, some firms still aren’t doing them; even worse, the firms “could not effectively identify their critical assets and the potential risks to those assets.”
• Vendor Management – Third-party vendor hacks are a serious problem, but some broker-dealers are still not properly vetting their business associates’ cybersecurity preparedness or sufficiently documenting vendors’ responsibilities in service level agreements.
• Branch Offices – Branch offices tended to have less robust cybersecurity than home offices; FINRA noted problems with password management, software updates, removable storage device security, data encryption, and reporting incidents.
• Segregation of Duties – Some small and medium-sized firms are not properly segregating responsibilities for cybersecurity rules and systems changes; for example, at some firms, network engineers are performing cybersecurity functions without any supervision from cybersecurity experts.
• Data Loss Prevention – Many firms need stronger DLP protocols, such as applying the same rules that currently protect clients’ Social Security Numbers to other sensitive data, such as account numbers.

Since cyber attacks represent such a serious threat to the U.S. and global financial systems, both FINRA and the SEC, NFA have indicated that cybersecurity will be of high priority throughout 2018. Firms that run afoul of SEC, NFA and FINRA standards – or, worse yet, suffer a breach – can face millions of dollars in fines. The good news is that a data-centric, integrated risk management approach to cybersecurity will head off all of the problem areas FINRA discusses in its report.

The cybersecurity experts at Lazarus Alliance have deep knowledge of the cybersecurity field, are continually monitoring the latest information security threats, and are committed to protecting organizations of all sizes from security breaches. Our full-service risk assessment services and Continuum GRC RegTech software will help protect your organization from data breaches, ransomware attacks, and other cyber threats.

Lazarus Alliance is proactive cybersecurity®. Call 1-888-896-7580 to discuss your organization’s cybersecurity needs and find out how we can help your organization adhere to cybersecurity regulations, maintain compliance, and secure your systems.