Imagine you're in charge of infiltrating sleeper agents into the United States. The year is 1983, and the proliferation of identity databases is making it increasingly difficult to create fake credentials. Ten years ago, someone could have just shown up in the country and gotten a driver's license, Social Security card and bank account -- possibly using the identity of someone roughly the same age who died as a young child -- but it's getting harder. And you know that trend will only continue. So you decide to grow your own identities.

Call it "identity farming." You invent a handful of infants. You apply for Social Security numbers for them. Eventually, you open bank accounts for them, file tax returns for them, register them to vote, and apply for credit cards in their name. And now, 25 years later, you have a handful of identities ready and waiting for some real people to step into them.

There are some complications, of course. Maybe you need people to sign their name as parents -- or, at least, mothers. Maybe you need to doctors to fill out birth certificates. Maybe you need to fill out paperwork certifying that you're home-schooling these children. You'll certainly want to exercise their financial identity: depositing money into their bank accounts and withdrawing it from ATMs, using their credit cards and paying the bills, and so on. And you'll need to establish some sort of addresses for them, even if it is just a mail drop.

You won't be able to get driver's licenses or photo IDs on their name. That isn't critical, though; in the U.S., more than 20 million adult citizens don't have photo IDs. But other than that, I can't think of any reason why identity farming wouldn't work.

Here's the real question: Do you actually have to show up for any part of your life?

Again, I made this all up. I have no evidence that anyone is actually doing this. It's not something a criminal organization is likely to do; twenty-five years is too distant a payoff horizon. The same logic holds true for terrorist organizations; it's not worth it. It might have been worth it to the KGB -- although perhaps harder to justify after the Soviet Union broke up in 1991 -- and might be an attractive option to existing intelligence adversaries like China.

Immortals could also use this trick to self-perpetuate themselves, inventing their own children and gradually assuming their identity, then killing their parents off. They could even show up for their own driver's license photos, wearing a beard as the father and blue spiked hair as the son. I’m told this is a common idea in Highlander fan fiction.

The point isn't to create another movie plot threat, but to point out the central role that data has taken on in our lives. Previously, I've said that we all have a data shadow that follows us around, and that more and more institutions interact with our data shadows instead of with us. We only intersect with our data shadows once in a while -- when we apply for a driver's license or passport, for example -- and those interactions are authenticated by older, less-secure interactions. The rest of the world assumes that our photo IDs glue us to our data shadows, ignoring the rather flimsy connection between us and our plastic cards. (And, no, REAL-ID won't help.)

It seems to me that our data shadows are becoming increasingly distinct from us, almost with a life of their own. What's important now is our shadows; we're secondary. And as our society relies more and more on these shadows, we might even become unnecessary.

Our data shadows can live a perfectly normal life without us.

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Bruce Schneier is Chief Security Technology Officer of BT, and author of Beyond Fear: Thinking Sensibly About Security in an Uncertain World.

Examples include:

• GSM mobile phones have an identifier for the phone (separate from the identifier for the user) that can be blacklisted when the phone is stolen.
• Some car radios will stop working when the battery is disconnected, and only start working again when a numeric code is entered. This is intended to deter theft of the radio.
• In Windows Vista, Bitlocker can be used to encrypt files. One of the intended applications for this is that if someone steals your laptop, it will be difficult for them to gain access to your encrypted files.

Ross told a story of what happened when he needed to disconnect the battery on his car: the radio stopped working, and the code he had been given to reactivate it didn’t work - it was the wrong code.
Ross argues that these reactivation codes are unecessary, because other measures taken by the car manufacturers - such as making radios non-standard sizes, and hence not refittable in other car models - have made them redundant.

I described how the motherboard on a laptop had needed to be replaced recently. The motherboard contains the TPM chip, which contains the encryption keys needed to decrypt files protected with Bitlocker. If you replace the motherboard, the files on your hard disk will become unreadable, even if the disk is physically OK. Domain-joined Vista machines can be configured so that a sysadmin somewhere within your organization is able to recover the keys when this happens.

Both of these situations suffer from classic usability problems: the recovery procedures are invoked rarely (so users may not know what they’re supposed to do), and, if your system is configured incorrectly, you only find out when it is too late: you key in the code to your radio and it remains a doorstop; the admin you hoped was escrowing your keys turns out not to have the private key corresponding to the public key you were encrypting under (or, more subtly: the person with the authority to ask for your laptop’s key to be recovered is not you, because the appropriate admin has the wrong name for the laptop’s owner in their database).

I also described what happens when an XBox 360 is stolen. When you buy XBox downloadable content, you buy two licenses: one that’s valid on any XBox, as long as you’re logged in to XBox live; and one that’s valid on just your XBox, regardless of who’s logged in. If a burglar steals your Xbox, and you buy a new one, you need to get another license of the second type (for all the other people in your household who make use of it). The software makes this awkward, because it knows that you already have a license of the first type, and assumes that you couldn’t possibly want to buy it again. The work-around is to get a new email address, a new Microsoft Live Account, and a new Gamer Tag, and use these to repurchase the license. You can’t just change the gamertag, because XBox live doesn’t let the same Microsoft Live account have two gamertags. And yes, I know, your buddies in the MMORPG you were playing know you by your gamertag, so you don’t want to change it.

The Consumerist has the story:

WaMu’s crack fraud department is at it again, according to reader Kristin. Someone broke into her iTunes account and bought a couple hundred dollars worth of iTunes gift cards with her debit card information. She disputed the charge and WaMu told her not to worry — they’d take care of it. Two months later, while on a trip to Chicago, WaMu reversed the credits, causing Kristin to become severely overdrawn. No amount of protesting will convince WaMu that she wasn’t lying about the iTunes break-in. Why? Because she never responded to some mail they sent to her old address.

Yuck. Read the customer’s full account, and more information about the credit card fraud laws, in the full article.

I am currently without a phone and would appreciate a speedy reply.

I have been a Verizon Wireless customer for over 5 years and my monthly bill easily averages over $200 during that time frame.  While I love your network, I have been completely unsatisfied by your selection of phones.  It is a stretch to say that my last phone worked—it had a feature called a battery that allowed me to switch from the car charger to my office charger without dying.  And I waited—under duress—until I was allowed to purchase a new phone with the discount.

My current phone has a wonderful battery life, but this is the 4th time the charger has snapped off in the phone.  The phone is fine, but I keep paying $30 for new chargers.  I refuse to purchase another or wait until February when I will be eligible for a new phone.  You sold a phone with a design flaw, and I’m not even asking for a refund or a free phone.  Just allow me to take a chance on a new one at the 2 year contract renewal rate. 

If not, I will gladly pay the early termination fee and leave Verizon.  On general principle, I will spend more money canceling my account with you than I would likely receive as a discount on a new phone.  As a customer, I consider it unacceptable that you sell inferior phones and leave me with no recourse.

The first time I waited haplessly to become eligible for a new phone.  I will not suffer a second time.  If you don’t like the fact that you will end up losing money by allowing me to purchase a new phone early, I suggest you take it up your vendors who supply you with awful products.  I can promise you that we will both lose more money if you don’t.

Sincerely,

Eric Marvets

Complicating factors is the impact (or lack thereof) of incidents on stock price.  Many researchers who identify themselves with the New School of Information Security (yours truly included) want to immediately look at stock price as a bell-weather metric for incident impact.  I think this stems from our days of slinging FUD, back when we could scream “Buy a firewall or we’ll have an incident and you’ll be on the front page of the paper and the stock price will go down!”  But these days notable incidents seem to suggest that the impact on stock price for an incident is short lived.  With qualifications, of course.

So what would/should we make of this from Money.co.uk?

£12million ($24m) Wiped off Helphire Stock after Malicious Email Sent to Clients

Car hire firm Helphire have taken Google to court after a malicious email sent from a Gmail account saw their shares plummet £12million in a single day.

The Bath-based business who specialise in providing replacement cars to ‘no-fault’ drivers involved in accidents on behalf of car insurance companies, initiated legal proceedings against the search engine giant as part of their attempt to find out who is responsible for sending the defamatory mailing.

Google are now known to have complied with the court order and have controversially supplied details of the email account and ISP used by the meddler.

Written under the psudoname Peter Franks, the 1200 word email is know to have been sent from a gmail account that was opened specifically for this purpose and closed a few minutes after the damage had been done…

…The misdemeanour couldn’t have come at a worse time for the struggling firm who have undergone a £45million rights issue and seen a 75% drop in the value of their stock already this year.

That last paragraph, for me, explains some of the difficulty in tying reputation damage to stock decreases.  It’s like when you read the headlines from Bloomberg about why the days stocks (or commodity) prices are up or down.  You know, the “Oil closes $3 higher on news that a notable South American dictator has a rather unpleasant boil in a very uncomfortable area” type of headlines.  You really do have to question the causality and correlation.  So in the Helphire case above - is this new drop in stock really because of the email sent?  If so, should we view that $24mil number as an independent data point to describe this sort of attack on reputation, or is the magnitude aggravated due to the long-term trend of stock price?

Even when we have “Objective Data” (an in-joke for Adam S.) like this decline in stock price, it is really difficult to provide any sort of precise estimate or measurement - about the future, present or past.  The best we can do is use ranges, distributions, that are reasonable based on evidence and observation.

So it’s worth filing away this sort of datum for future use - while dutifully acknowledging the qualifiers we might place around it.

So the questions I ask here - what should we make of this new information, and how should we view the $24million drop - they’re not rhetorical.  I am very interested in your views and welcome your comments!

In addition to the above services, KBank offers a service that permits users to receive an SMS message that details any change in account balance and/or point-of-sale (POS) transaction with your debit card.   I really like this service and the feeling of security knowing when, where and by how much my balance changes or my debit card is used in a transaction.    The KBank POS SMS notification is so fast that when I present my card to a merchant I normally receive an SMS message detailing the transaction before the merchant returns for my signature.  (There is an unfortunate lag in the balance change notification that can run minutes to hours behind real-time, but the POS VISA debit card notification is real-time).

As the story goes,  I should have been using my KBank card and account a few weeks ago and not my US-based VISA debit dard.  Why?

My US-based VISA debit card was cloned sometime on or before August 8th.   I am really careful with this card, so I was surprised the magnetic strip was cloned at a POS merchant.   The fraudster made 7 fraudulent transactions beginning on August 8th for a total of around $2500 USD, mostly on August 11th, before I discovered the fraudulent transactions viewing my account on-line.

This would not have happened with KBank SMS-based transaction notification services.

The first transaction with my cloned VISA debit card was less than $50 USD (I assume the fraudster was “testing the water”).   If I was using my KBank card, I would have received an immediate SMS message detailing a POS transaction in Bangkok when I was physically far away from Bangkok in Chiang Mai.   I could have immediately called the bank (or logged in) and blocked the debit card, limiting potential losses to the bank or the merchant to one fraudulent transaction, not seven.

In addition, KBank offers what they call a Web-Shopping VISA card, where you can go into your on-line account (verified by SMS OTP as mentioned) and request a VISA debit card number (with expiration date, CCV etc).   You set the limit from 0 to 500,000 THB (Thai Baht) per day; and you can login to your account and change this anytime (authenticating your transaction with another SMS-based OTP). You can also block or cancel this number anytime and apply for another one.

I am amazed that in Thailand I receive much better anti-fraud prevention and detection services than with banks in the US.   I know of no bank or brokerage in the US that offers the same quality of service and security as KBank in Thailand.