Attacks/Breaches
10/10/2014
06:10 PM
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Dairy Queen Breach Shines Light On Impact Of 3rd-Party Breaches

Yet another retail chain confirms a data breach of customer payment information via a third-party vendor, and Kmart tosses its hat into the breached ring today.

Lowe's, Goodwill Industries International, Jimmy John's, and Dairy Queen have little in common at first glance. But they share one thing in common that they probably wish they didn't: All three have been in the news for security incidents that began with a breach at a third-party vendor.

They are far from alone in this. According to the Ponemon Institute's 2014 data breach cost study, third party involvement in a breach increased the global average of data breach by an average of $14.80 per record.

Whether they are unsuspecting portals for cyberattackers or the originators of the attack, vendors and subcontractors are a growing and often ignored threat for organizations of all sizes, Armond Caglar, senior threat specialist at TSC Advantage, says. A regular security assessment of the entire organization -- including vendor network analysis -- is highly recommended, and can give a company the opportunity to catalogue its supplier and vendor ecosystem and identify third-parties that maintain access paths to corporate networks, says Caglar.

In addition, it offers organizations a chance to modify existing service level agreements (SLAs) to ensure basic data security measures are being followed, he adds.

Dairy Queen confirmed today that a third-party vendor's compromised account credentials were used to access at some locations. As a result, the attackers were ultimately able to infect point-of-sale devices with the Backoff malware and steal data. The malware has since been contained, but is believed to have affected nearly 400 Dairy Queen locations and one Orange Julius store.

"We are committed to working with and supporting our affected DQ and Orange Julius franchise owners to address this incident," says John Gainor, president and CEO of International Dairy Queen, in a statement. "Our customers continue to be our top priority."

Meanwhile, Kmart late today reported that it was investigating a data breach, exposing customer payment card data. 

While the investigation into the Dairy Queen breach continues, however, there are numerous things for businesses to consider as they take a look at their own security posture.

"First and foremost, any service-level agreement [SLA] or contract with a vendor should specifically include a clause allowing a company the right to terminate the relationship if a breach occurs and it is severe enough," says Caglar.

Second, he adds, companies should ensure baseline technical controls are in place in their SLAs to cover aspects such as access control and data layer controls, he says.

"Specifically, security requirements a company should mandate for a vendor SLA can be... a requirement for multi-factor authentication, high encryption standards and legacy endpoint measures such as firewalls and AV, consistent audit schedule, and a thorough understanding of vendor's HR protocols, such as hiring and termination policies and procedures to determine vulnerabilities and possible insider threat propensity," he says.

Joe Schumacher, senior security consultant at Neohapsis, recommends business departments work with IT operations to ensure that only necessary accounts have access to business resources. IT should do their part by putting strong authentication controls in place for accessing those services as well, including enforcing use of strong passwords, he says.

Supply change management and/or third party business service assessments are critical for businesses in today's ever connected world, he adds.

"These assessments should look at items of data access, means of remote access, credential management, and general IT security controls. Businesses must also look internally at their business operations and enforce strong security controls to their business partners," Schumacher says.

"These third-party vendor breaches continue because enterprise security teams are only using defensive tools to protect a network at the point of a breach, the shortest point of the attack chain. Enterprises can take major strides towards mitigating these attacks by monitoring all users’ activity and behavior within a network," says Nir Polak, CEO and co-founder of Exabeam. "This helps identify suspicious users who may be attempting to steal data through the use of stolen credentials."

Brian Prince is a freelance writer for a number of IT security-focused publications. Prior to becoming a freelance reporter, he worked at eWEEK for five years covering not only security, but also a variety of other subjects in the tech industry. Before that, he worked as a ... View Full Bio

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tjgkg
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tjgkg,
User Rank: Apprentice
11/24/2014 | 10:35:30 AM
Re: Data Breach
It might be something to watch but you can be sure theives will be watching as well. Apple better make sure this system is bullet proof or there will be major problems for them.
tjgkg
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tjgkg,
User Rank: Apprentice
11/24/2014 | 10:26:19 AM
Re: Data Breach
True! But i cannot imagine cash ever going away even if Denmark has decided to try that route. These epayment schemes are another way for companies to shave off a % for themselves. They are much like the thieves who used to clip coins long ago.
Robert McDougal
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50%
Robert McDougal,
User Rank: Ninja
10/17/2014 | 11:09:43 AM
Re: Data Breach
The problem with the payment industry as it currently stands is that every retailer has already purchased the hardware to scan magnetic strips.  Upgrading POS systems to allow NFC or other methods has a cost attached and who knows how fast retailers will upgrade.
bmoore201
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50%
bmoore201,
User Rank: Apprentice
10/15/2014 | 7:42:04 AM
Risk Management
Brian, great article. Difficulty exists for large and small companies or retailers to balance cybersecurity needs of the customer and business with those of an organization that is so dispersed....a balancing act faced by everyone to include the individual consumer conducting e-transactions or banking on-line. Articles like yours help to highlight the issues but we need to counter with recommendations on approaches to fixes.  This sort of places 3rd party vendors in a bad light and I am certain not all 3rd parties are knowingly negligent or want to be the subject of someone's next breach article. You do provide recommendation that the company/retailer spend more time reviewing SLAs and vendor cybersecurity hygiene...but there is a lot more to do. 
Marilyn Cohodas
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Marilyn Cohodas,
User Rank: Strategist
10/13/2014 | 9:10:29 AM
Re: Data Breach
Apple Wallet is definitely a payments technology to watch. AppleInsider last week reported on Apple's application for "Methods for Adjusting Near Field Communications Circuitry during Mobile Payment Transactions" to the U.S. Patent and Trademark Office. In includes some technical details about how the payment system works with NFC protocols and the hardware, and software safeguards required to perform secure transactions without physical connection. You can check the AppleInsider piece here.
Ariella
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50%
Ariella,
User Rank: Apprentice
10/11/2014 | 8:19:30 PM
Re: Data Breach
I'm sure a lot more people are planning to pay for their ice cream with cash now. 
tjgkg
50%
50%
tjgkg,
User Rank: Apprentice
10/11/2014 | 4:31:40 PM
Data Breach
You sort of wonder how these types of leaks are going to affect the use of Apple Wallet once that gets up and running. I do not use payment apps on my phone or even allow companies to store my credit card info on online accounts so I have been lucky so far but you just never know how intrusive these theives are.
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