A serious problem in adequate disclosure could represent a bigger exposure than the massive ongoing attacks in the report

Rob Enderle, Contributor

August 8, 2011

3 Min Read

McAfee released a report last week detailing its penetration of a remote-access tool, and its analysis revealed two types of public and private organizations: those that knew they were penetrated and those that hadn’t figured it out.

But there are some pretty strict disclosure rules regarding compromised political and financial data, and this report would indicate that disclosures that should have been made were likely avoided. This might make the real dirty rat in this story the public and private organizations that aren’t in compliance with disclosure rules.

The big problem with disclosure is that it is both embarrassing and could actually result in the very problems that disclosure is supposed to avoid -- problems like getting fired, being fined, having to pay penalties, and facing ongoing invasive scrutiny. In other words, while concealing a problem is risky, and certainly if that concealment is discovered, likely career-ending, but the career-ending part might happen even if the disclosure is done properly as the company looks for someone below the CEO to scapegoat. The discovery of breaches tends to happen down in the bowels of a company, not at the executive level, placing decision-making power with folks who don’t have the full perspective of what can happen to the company if a cover-up is disclosed. This tends to put the people who are mostly likely to be penalized (CEO, CFO, CIO) outside of the decision loop, and given they are the ones often taking the primary risk even if they aren’t aware of it, this decoupling of risk and decision contributes strongly to this problem. This suggests more effort than is generally being taken needs to go into mitigating the risk, starting with a reminder that executive management must be in the loop for any decision surrounding a penetration because criminal charges could result. And training for employees to better identify the kind of attack, spearfishing, that apparently is in most common use is also crucial.

McAfee recommended additional security processes, from email scans to detect spearfishing messages, to networking scans to detect unpatched hardware or unusual traffic patterns. But the message is clear: This is not an exposure you can ignore.

The report implies that many companies are covering up breaches. That is a serious problem because the world economy is at a breaking point, and a major disclosure of a covered-up national or international breach could be the spark that ignites a collapse.

As people looked for scapegoats, those who cover up an attack will be the low-hanging fruit; this suggests the financial and personal risks of the alleged problem could outweigh significantly the problem itself.

The recommendation is to quickly determine which kind of company you are, mitigate the attack, and disclose before the lack of disclosure is discovered and you are implicated by it. This is War Room-level stuff, however, and if the penetrations are as deep as McAfee alleges, even your board should likely be involved.

The worst rat I smell is the decision to cover up problems like this, and the real risk that this tendency could cause another economic collapse or worsen the one we are now in.

Rob Enderle is president and founder of The Enderle Group. Special to Dark Reading

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