Ameritrade Security Audit Finds Privacy-Busting Back Door

RalphTheWonderLlama writes "In recent months, online stock brokers have apparently been upset by the sale of their email addresses to spammers. Today TD Ameritrade released details of their investigation into the matter (along with a video message from the CEO and special FAQ). It seems some 'unauthorized code' had exposed client email addresses and possibly other sensitive information from an internal database. 'TD Ameritrade tracked down the break-in while doing an internal investigation into stock-related spam. The company called in forensic investigators and they discovered "unauthorized code" in their system that provided access for the hacker or hackers. According to the advisory, the code has been eliminated from the system. Moglia, speaking in an online video-taped message to customers, said he is "confident" that they have figured out how the information was taken.'"

Comments

confidant[sic] they deleted the bad code

[PitaBred]

Great. How did that "bad code" get there? Did they close THAT loophole? Because if not, it's just a matter of time.

Re:confidant[sic] they deleted the bad code

[ErroneousBee]

More likely, start by playing the "Guess the Webserver" game.

Compare with the likes of Bank of India, Monster.com, USAjobs.gov, myspace.com and other recent security incidents.

Do you see a pattern emerging?

no evidence?

[Anonymous Coward]

"there is no evidence that our clients' Social Security numbers were taken" == "there is no evidence that our clients' Social Security numbers were not taken" == "we don't know if our clients' Social Security numbers were taken" == "our clients should probably assume that their SSNs, DOBs, and everything else needed to ruin their lives were taken."

Unacceptable

[mkraft]

As a TD Ameritrade account holder I find this unacceptable. Not only do they have unauthorized code running on their local systems with access to customers social security numbers and the like, but they don't even tell their customers when this happens other than issuing a generic press release in which they say they think the hackers only got email addresses despite the fact that the data base the hackers had access to also had birth dates, social security numbers and everything else necessary to steal account holders' identities.

How does unauthorized code even get into a financial institutions systems? The banking systems should never be accessible via public networks, only private ones, so this should never have happened.

What exactly is TD Ameritrade doing about this? TD Ameritrade should at least give it's customers free credit monitoring.

Re:Unacceptable

[klenwell]

I'm a TD Ameritrade account holder, too, and contacted them last month after I noticed I got some penny-stock spam addressed to me with a TD Ameritrade subject line right after I got my monthly email statement. This was the response:

Thank you for taking the time to address your concerns to Executive Management. I very much appreciate your concern and would like you to know we are conducting an internal investigation regarding the complaints you have disclosed in your email regarding the SPAM. While I will not be able to relay any specifics or update you on the findings, I wanted you to know that we are aware of the situation and are making the necessary corrective actions to remedy the issue.

Citing your inquiry regarding account safety, your assets held with our company are protected by our Asset Protection Guarantee. This safeguards your account from any loss due to fraudulent activity. If you have any further questions regarding this policy please contact our Client Service Representatives at 800-669-3900. They are available 24 hours a day, 7 days a week, excluding market holidays.

Warm regards,

Adam Triplett
atriplett@tdameritrade.com
Senior Research Analyst
Office of the President
Private Client Division
TD AMERITRADE Holding Corporation

At least, it wasn't a bald-faced denial.

It's reached the point that I just assume that sooner rather than later all my private information will be stolen, loss, and compromised -- if it hasn't already. (As a UC graduate, I think I've been party to two other well-publicized identity-theft cases.)

Luckily, I have several different internet identities. So as soon as one is stolen, I move on to the next one. (If only it were that easy...)

Re:Unacceptable

[Technician]

How does unauthorized code even get into a financial institutions systems?

http://www.darkreading.com/document.asp?doc_id=113460&print=true

No. 1: The Thumb Drive Caper

In June, a penetration testing firm planted 20 infected USB drives in the bathrooms and parking lots of a busy credit union. It was a simple, non-technical exploit -- and also one of the most effective of the year. Out of the 20 drives, 15 were inserted into PCs by curious credit union employees. If the infection hadn't been benign, the entire business might have gone up in smoke.

The account of this exploit -- perpetrated by one of our own columnists, Steve Stasiukonis, vice president and founder of Secure Network Technologies Inc. -- was by far our best-read story of the year. It exposed a frequently-overlooked vulnerability in most organizations, and it brought forth a whole range of vendors and products that are now attempting to close the hole.

We figured we would try something different by baiting the same employees that were on high alert. We gathered all the worthless vendor giveaway thumb drives collected over the years and imprinted them with our own special piece of software. I had one of my guys write a Trojan that, when run, would collect passwords, logins and machine-specific information from the user's computer, and then email the findings back to us.

That was just one of many ways to do it.

Google for it..

[Dynamoo]

Do a Google search for Ameritrade spam. This isn't a new problem, it's been going on for months and even years where there's clear evidence that the data is being lifted by spammers.

You don't have to look far - this one is particularly damning, and I've seen evidence elsewhere that people set up an email address ONLY for Ameritrade and they've watched the spam come in.

Exec-lish is a weird language.

[Futurepower(R)]

Quotes, and translation:

The company called in forensic investigators and they discovered "unauthorized code" in their system that provided access for the hacker or hackers.

Moglia, speaking in an online video-taped message to customers, said he is "confidant" that they have figured out how the information was taken.

It's necessary to know how to translate those statements. It looks like plain English, but it isn't. It's Exec-lish, and must be translated.

Exec-lish to English translation: "We don't actually have anyone our company that understands technical computer issues. The software was written by a low bidder to whom we awarded a contract. Since we don't have any technically knowledgeable people on staff, we had no way to understand if we should have confidence in the bidder or not."

"We don't know how many people accessed our system through the back door, or how many times, or for how long. (Actually I had never heard the term 'back door' until yesterday.) Since we don't have any technical knowledge, we can't assess whether there are other back doors. Possibly even the forensic investigators have left their own back doors."

Exec-lish is a weird language that doesn't allow the expression of negative facts. So, it is possible that, if the executive wanted to be truthful, he or she would say, "I'm not qualified to be in this job, since I don't know enough to understand the company's operations thoroughly."

I'm just guessing about that translation, but gathering from what I've seen at other companies, it is not far off.

Press Release Doesn't Tell the Whole Story

[Ethan Preston]

I am a class action attorney. My law firm and I sued Ameritrade over failing to disclose the security breach on May 31, 2007. We filed for a preliminary injunction on July 10, 2007. Part of the relief we sought for the accountholders in the preliminary injunction was a disclosure of this information.

In sum, this Motion seeks an Order from this Court against TD AMERITRADE, Inc. that: ... 8. Requires TD AMERITRADE, Inc. to prominently disclose in its Privacy Statement and in emails or other individual disclosures to its accountholders: ALERT: AMERITRADE'S INFORMATION SYSTEMS ARE NOT NECESSARILY SECURE AND WE CANNOT ASSURE THE SECURITY OF YOUR PERSONAL INFORMATION. THERE IS EVIDENCE THAT SOME ACCOUNTHOLDERS' EMAIL ADDRESSES HAVE LEAKED FROM AMERITRADE'S COMPUTER SYSTEMS TO SPAMMERS. AMERITRADE HAS AN ONGOING INVESTIGATION INTO THIS SITUATION. YOUR NAME, SOCIAL SECURITY NUMBER, AND YOUR EMAIL ADDRESS MAY HAVE BEEN LEAKED AS WELL. We recommend that you place a fraud alert on your credit file. A fraud alert tells creditors to contact you before they open any new accounts or change your existing accounts. Call any one of the three major credit bureaus. As soon as one credit bureau confirms your fraud alert, the others are notified to place fraud alerts. All three credit reports will be sent to you, free of charge, for your review. You can contact Equifax (800-685-1111), Experian (888-397-3742), or TransUnionCorp (800-680-7289). Even if you do not find any suspicious activity on your initial credit reports, the Federal Trade Commission (FTC) recommends that you check your credit reports periodically. Victim information sometimes is held for use or shared among a group of thieves at different times. Checking your credit reports periodically can help you spot problems and address them quickly. If you find suspicious activity on your credit reports or have reason to believe your information is being misused, call [insert contact information for law enforcement] and file a police report. Get a copy of the report; many creditors want the information it contains to absolve you of the fraudulent debts. You also should file a complaint with the FTC at www.consumer.gov/idtheft or at 1-877-ID-THEFT (877-438-4338). Your complaint will be added to the FTC's Identity Theft Data Clearinghouse, where it will be accessible to law enforcers for their investigations. You can obtain a copy of Take Charge: Fighting Back Against Identity Theft, a comprehensive guide from the FTC to help you guard against and deal with identity theft at: http://www.ftc.gov/bcp/edu/pubs/consumer/idtheft/idt04.htm

It's real, and very worrying.

[ballpoint]

The email addresses I used contained 'datek' and later 'ameritrade' when Datek merged with Ameritrade. You can guess that I didn't use these email addresses for anything else, yet both were spammed. At the time I thought they were leaked by someone logging traffic at an ISP.

Despite the whitewashing that's going on, AMTD is going to take a BIG hit. These issues are not to be taken lightly.

From the FAQ:

"How do you know that this sensitive information, like Social Security Numbers, hasn't been leaked or misused? After extensive investigations involving outside forensics experts, we have no evidence that this sensitive personal information was taken. That is one of the reasons why we have also hired ID Analytics. Its initial investigation has concluded that there is no evidence of identity theft as a result of this issue."

Absence of evidence is not evidence of absence.

and the rich get richer

[tidokoro]

I'm actually a TD account holder and wouldn't mind seeing them punished for this. Unfortunately, I've never been party to a class-action suit that even came to close to compensating me for the time I took to fill out whatever forms I needed to fill out much less what I had actually loss as part of the class. From the last class-action I joined:

Dear Claimant,

The Proof of Claim and Release you submitted with respect to the In re [Bankrupt Company] Securities Litigation has been processed under the terms and conditions of the Stipulations of Settlement and Second Distribution Order as approved by the United States District Court for the Easter District of New York. Please be advised such Stipulation and Order provides:

"If such Authorized Claimant is allocated less than $10.00 in value from the remaining Settlement Fund, then such Authorized Claimant shall not receive a further distribution from the Settlement Fund, and such amounts shall be re-allocated among the remaining Authorized Claimants."

Based upon these terms, we regret to inform you the proration of your share of the Settlement Fund, as approved by the Court, would amount to less than ten dollars ($10.00). Therefore you will not receive a distribution from the Settlement Fund.

Sincerely,
Claims Administrator