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11/5/2009
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Securing The Cyber Supply Chain

Many parties touch your organization's systems and software, potentially exposing them to malware, breaches, or worse. A new end-to-end approach is required to minimize the risks.

Target: Financial Systems

In the private sector, financial systems are being targeted, says Paul Kocher, president and chief scientist of Cryptography Research, which advises companies on cybersecurity, designs tamper-resistant chips, and licenses technology to protect against "differential power analysis," an advanced technique where an attacker analyzes power consumption of, say, smart cards to determine cryptographic keys.

"Someone will target an individual or organization and invest a nontrivial effort to get that data," he says. For example, cybercriminals have surreptitiously inserted their own router into a company's network and "started pulling out information for fraudulent purposes," Kocher says.

The Financial Sector Information Sharing and Analysis Center, an industry organization, recently created a working group to address IT supply chain integrity. Its members include Goldman Sachs, Depository Trust and Clearing Corp., Citigroup, Morgan Stanley, the Bank of New York Mellon, J.P. Morgan, Bank of America, and NYSE/Euronext.

"We face organized cyberenemies who are hell-bent on positioning themselves to bring down the entire U.S. financial services system," said Donald Donahue, CEO of Depository Trust and Clearing Corp., a holding company that processes many of the nation's capital market transactions, at a financial services industry conference in May. "Their intent to penetrate the supply chain exploiting whatever vulnerabilities that may exist is very clear."

Point-of-sale systems and ATMs are among the most commonly attacked financial systems, says Cryptography Research's Kocher. Among the techniques that have been employed: ATMs have been delivered with malicious code pre-installed, hackers have created fake endpoints on ATM networks, and the people servicing machines have turned out to be fraudsters, says Kocher.

Security and IT managers need to develop strategies for dealing with the IT supply chain threat in a comprehensive way. Measures for minimizing the risks include buying only from trusted vendors, disconnecting critical machines from outside networks, and educating users on the threat and protective measures they can take.

Depository Trust and Clearing Corp. has implemented governance for vulnerability management throughout its supply chain and looks at IT security along "the entire life cycle," Donahue said. That includes where software was coded and hardware manufactured, access controls throughout software development and delivery, and security within DTCC itself.

The first step in any cyber supply chain action plan should be to categorize and catalog the risks, says Lewis from the Center for Strategic and International Studies. For the most critical functions at the highest security levels--systems used for nuclear weapons testing, for instance--an organization might need to use a "100% reliable" supply chain, though that gets prohibitively expensive very quickly. That level of reliability would require fully documented software development and hardware by trusted partners in controlled environments.

SAIC and the University of Maryland's School of Business have developed a cyber supply chain "assurance model" to help organizations tackle the issue in a methodical way. The model is the result of an 8-month study that included an assessment of the state of the art in supply chain management and cybersecurity, interviews, and focus groups. "Everybody viewed themselves as the terminus in the supply chain, even though when people procure IT these days it's often for their customer or their customer's customer," says SAIC's Rossman. "Most organizations don't have good visibility into their tier 1 supply chain providers, much less their lower-tier suppliers."

The cyber supply chain assurance model is comprised, visually, of nested circles (see chart, p. 46). At the center is governance, managed by a supply chain orchestrator. Beyond that are systems integration and shared services; it's here that the model introduces the concept of an "enforcer" of supply chain custody. The outside circle, or "field layer," addresses cybersecurity in software code, IT hardware, enterprise applications, networks, and people.

The report authors cite the need for a "chain of custody," including real-time documentation of systems development practices, among participants in the supply chain. They point to the quality-control measures used in the pharmaceuticals industry, with extensive online documentation and product tracking, as a model for cyber supply chains.

chart: Cyber Supply Chain Assurance Model

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