Real-Time Keyloggers
The NY Times has a story and a blog backgrounder focusing on a weapon now being wielded by bad guys (most likely in Eastern Europe, according to the Times): Trojan horse keyloggers that report back in real-time. The capability came to light in a court filing (PDF) by Project Honey Pot against "John Doe" thieves. The case was filed in order to compel the banks — which are almost as secretive as the cyber-crooks — to reveal information such as IP addresses that could lead back to the miscreants. Or at least allow victims to be notified. Real-time keyloggers were first discovered in the wild last year, but the court filing and the Times article should bring new attention to the threat. The technique menaces the 2-factor authentication that some banks have instituted: "By going real time, hackers now can get around some of the roadblocks that companies have put in their way. Most significantly, they are now undeterred by systems that create temporary passwords, such as RSA's SecurID system, which involves a small gadget that displays a six-digit number that changes every minute based on a complex formula. If [your] computer is infected, the Trojan zaps your temporary password back to the waiting hacker who immediately uses it to log onto your account. Sometimes, the hacker logs on from his own computer, probably using tricks to hide its location. Other times, the Trojan allows the hacker to control your computer, opening a browser session that you can't see."
That doesn't stop them from blocking your login such that they are the only ones using the password/id. They log the keystrokes prior to it being sent over the wire to the bank, block the post to login.cgi, and login for themselves.
I.O.U One Sig.
No need to execute them. No need to punish them severely at all. We just need to catch them. Given a 50% risk of being caught a one year prison sentence would provide more than adequate deterrence. Given the present one in 100 million risk of being caught an 18th century hanging would offer no significant deterrence.
This applies to crime in general as well.
Warning: this article may contain humor, sarcasm, parody, and perhaps even irony. Read at your own risk.
They log the keystrokes prior to it being sent over the wire to the bank, block the post to login.cgi, and login for themselves.
If they are smart they can even provide a fake error page once they've acquired the credentials that tells the user that the site is "experiencing technical difficulties" and that they should please try again in 15 minutes. 99.99% of users won't think a thing of it.
When information is power, privacy is freedom.
I work for RSA and you are absolutely correct. Attempting to authenticate twice with the same tokencode will automatically yield a rejection.
I believe the idea of this "real-time application" is that they see you typing in your passcode and zap that code into the authentication system before you do. The success of this hack is predicated on the notion that they are watching with baited anticipation, ready to spring into action the exact moment you sign into your online bank.
The chance of this actually occurring is highly remote, to say the least. The technique of racing ahead of a potential 2-factor authentication is compelling in theory, but of little practical use. If they're going to get into your bank, it has nothing to do with "defeating" Securid (or any other one-time display mechanism).
Suffice to say, this story is bunk.