+1.800.357.1019

+1.800.357.1019

Feel free to call us toll free at +1.800.357.1019.

If you are in the area you can reach us at +1.360.359.4400.

Standard support
6:30am - 4:00pm PST, Monday - Friday, Free

Premium support
If you own Townsend Security 24x7 support and
have a production down issue outside normal
business hours, please call +1.800.349.0711
and the on-call person will be notified.

International customers, please dial +1.757.278.1926.

Townsend Security Data Privacy Blog

Privately Held Companies Think They Don’t Need to Worry About Security and Compliance

Posted by Patrick Townsend on Sep 13, 2016 9:37:33 AM

In my role at Townsend Security I engage with companies both large and small and have many conversations about data breaches and security. One pattern that I see a great deal is the belief by privately held companies that they are not subject to compliance regulations, are not a target by cybercriminals, and don’t have much to worry about. The feeling seems to be “Gee, we are not publicly traded so we don’t have to do all that security stuff. It’s hard and expensive and it doesn’t really apply to us. Besides, we are too small for hackers to bother with.” I’m sure I’ve heard exactly these comments a number of times.

For the sake of these small businesses who represent the real backbone of our economy, we need to dispel these myths. Let’s look at a few of them:

We Don’t Need to Meet PCI Compliance
Download Whitepaper on PCI Data Security Anyone who takes credit or debit cards in their business must comply with the PCI Data Security Standard (PCI-DSS). When you signed your merchant agreement you agreed to be bound by the data security standards for payment cards. This is not a government regulation - this is an agreement between you and your payment provider and they all require this compliance. It doesn’t matter if you are small or large, privately held or publicly traded on the NYSE. You have to meet PCI compliance for security. Failure to comply with PCI-DSS standards can put you a jeopardy for loss of the ability to accept credit card payments. This can be devastating for any company.

I Only Store a Small Number of Credit Cards, PCI Doesn’t Apply to Me
This is an incorrect understanding of the PCI Data Security Standard. Processing a small number of payment transactions, or a low dollar amount, may put in you a lower category for PCI compliance, but the PCI-DSS still applies to you. In the event of a data breach you may find that you have new on-site PCI audit requirements, additional liabilities, and you may have to pay a higher rate to authorize payment transactions. These effects can really hurt your business. Rest assured that if you take credit card payments the PCI-DSS requirements apply to you.

We Don’t Need to Meet HIPAA Compliance and Reporting
If you are a medical organization defined as a Covered Entity under HIPAA regulations you need to meet HIPAA data security requirements. This includes both privately held as well as publicly traded organizations. There is no exclusion for privately held organizations whether you are a country doctor with a small practice or a large HMO or hospital chain. A quick review of the compliance actions by OCR shows that privately held organizations are just as likely to be fined as larger organizations. And penalties often do not stop at monetary fines, there are often requirements for years of on-site security audits and assessments that are very costly.

We are Not Big Enough to be a Target
Many executives and members of the IT organization at privately held companies believe that they are not a target of hackers and cybercriminals simply because they are privately held and small. This falls into the category of wishful thinking. In fact, as the FBI reports, smaller private companies are increasingly the focus of cybercriminals and are experiencing significant financial losses. Here is what John Iannarelli, and FBI consultant, says:

"Time and again I have heard small business owners say they have nothing to worry about because they are too small to interest cybercriminals. Instead, small businesses are exactly who the criminals are targeting for two primary reasons. In the criminal's mind, why go after large companies directly, when easier access can be attained through small business vendor relationships. Secondly, since small businesses have less financial and IT resources, criminals know they are less 'compromise ready' and tend to be less resilient."

We Don’t have to Report a Data Breach
Many smaller privately held companies are under the mistaken impression that compliance laws do not require them to report a data breach. This is incorrect - state and federal laws that require data breach notification require small businesses and privately held companies to report data breaches. Being small or privately held does not exclude you from data breach notification.

Compliance Regulations Don’t Apply to Us
It is true that if you are a private company the Sarbanes-Oxley compliance regulations certainly do not apply to you, those regulations only apply to publicly traded companies. And the Federal Information Security Management Act (FISMA) does not apply to you because it only applies to US government federal agencies. You are, however, covered by state privacy law, PCI Data Security Standards (if you accept credit or debit cards), HIPAA if you are a Covered Entity in the medical segment or if you process patient data for a Covered Entity, and the Federal Trade Commission (FTC).

We are Not Under FTC Rules About Data Privacy
The Federal Trade Commission has a broad charter to protect consumers and this includes enforcement for consumer privacy. From large companies like Google, Facebook and Twitter to small companies like an auto dealership, the FTC has taken enforcement actions that include private companies. The enforcement actions can include fines, mandatory audits that last for many years, and other penalties. Private companies do fall under FTC jurisdiction. You can read more about the FTC and data privacy here.

In summary, smaller privately held companies are the target of cybercriminals, are less prepared to deal with an attack, and have fewer resources to recover from an attack. No competent executive in a privately held company would forgo general liability insurance for their business, but are much more likely to suffer a loss from a cyber attack. It is not good business sense to ignore real threats.

Some last thoughts from the FBI:

The criminal then either creates another account or directly initiates a funds transfer masquerading as the legitimate user. The stolen funds are often then transferred overseas. Victims of this type of scheme have included small and medium-sized business, local governments, school districts, and health care service providers.

The potential economic consequences are severe. The sting of a cyber crime is not felt equally across the board. A small company may not be able to survive even one significant cyber attack.

From a Washington Post interview with the FBI:

Federal agents notified more than 3,000 U.S. companies last year that their computer systems had been hacked, White House officials have told industry executives, marking the first time the government has revealed how often it tipped off the private sector to cyberintrusions.

The alerts went to firms large and small, from local banks to major defense contractors to national retailers such as Target, which suffered a breach last fall that led to the theft of tens of millions of Americans’ credit card and personal data, according to government and industry officials.

“Three thousand companies is astounding,” said James A. Lewis, a senior fellow and cyberpolicy expert at the Center for Strategic and International Studies. “The problem is as big or bigger than we thought.”

Others notified by the Secret Service last year included a major U.S. media organization, a large U.S. bank, a major software provider, and numerous small and medium-size retailers, restaurants and hotels, officials said.

“Within hours of us coming up with information that we can provide, we would go to a victim,’’ said Edward Lowery, Secret Service special agent in charge of the criminal investigative division. “The reaction would be just like when you’re told you’re the victim of any crime. There’s disbelief, there’s anger, all those stages, because there’s a lot at stake here.”

Yes, Indeed. There is a lot at stake.

download the Whitepaper: Meet the Challenges of PCI Compliance

Topics: Compliance, PCI DSS

IBM i, PCI DSS 3.2, and Multi-Factor Authentication

Posted by Luke Probasco on Aug 16, 2016 10:48:05 AM

With the recent update to the Payment Card Industry Data Security Standard (PCI DSS) regarding multi-factor authentication (also known as Two Factor Authentication or 2FA), IBM i administrators are finding themselves faced with the requirement of deploying an authentication solution within their cardholder data environments (CDE). Prior to version 3.2 of PCI DSS, remote users were required to use two factor authentication for access to all systems processing, transmitting, or storing credit card data. With version 3.2 this is now extended to include ALL local users performing administrative functions in the CDE.

Here is an excerpt from section 8.3: (emphasis added)

8.3 Secure all individual non-console administrative access and all remote access to the cardholder data environment (CDE) using multi-factor authentication.

IBM i, PCI DSS, & Multi-Factor Authentication I recently was able to sit down with Patrick Townsend, Founder & CEO of Townsend Security, and talk with him about PCI DSS 3.2, what it means for IBM i users, and what IBM i users can do to meet the latest version of PCI DSS.

Thanks for taking some time to sit down with me, Patrick. Can you recap the new PCI-DSS version 3.2 multi-factor authentication requirement? This new requirement seems to be generating a lot of concern.

Well, I think the biggest change in PCI DSS 3.2 is the requirement for multi-factor authentication for all administrators in the cardholder data environment (CDE).  Prior to 3.2, remote users like contractors and third party administrators, had to use multi-factor authentication to login to the network.  This update extends the requirement of multi-factor authentication for ALL local, non-console users.  We are seeing businesses deploy multi-factor authentication at the following levels:

  •      Network Level - When you first access the network
  •      System Level – When you access a server or any system with the CDE
  •      Application Level – Within your payment application

The requirement for expanded multi-factor authentication is a big change and is going to be disruptive for many merchants and processors to implement.

Yeah, sounds like this is going to be a big challenge.  What does this mean for your IBM i customers?

There are definitely some aspects of this PCI-DSS update that will be a bigger challenge on the IBM i compared to Windows or Linux.  First, we tend to run more applications on the IBM i.  In a Windows or Linux environment you might have one application per server.  On the IBM i platform, it is not uncommon to run dozens of applications.  What this means is, you have more users who have administrative privileges to authenticate – on average there can be 60 or more who can sometimes be a challenge to identify!  When merchants and processors look at their IBM i platforms, they will be surprised at the number of administrators they will discover.

Additionally, the IBM i typically has many network services exposed (FTP, ODBC, Operations Navigator, etc).  The challenge of identifying all the entry points is greater for an IBM i customer.

You say it is harder to identify an administrative user, why is that?

On the IBM i platform, there are some really easy and some really difficult administrative users to identify.  For example, it is really easy to find users with QSECOFR (similar to a Windows Administrator or Linux Root User) privileges.  But it starts to get a little more difficult when you need to identify users, for example, who have all object (*ALLOBJ) authority.  These users have almost the equivalent authority of QSECOFR.  Finding, identifying, and properly inventorying users as administrators can be a challenge.

Additionally, with a user profile, there is the notion of a group profile.  It is possible for a standard user, who may not be an administrator, to have an administrative group profile.  To make it even more complex, there are supplemental groups that can also adopt elevated authority.  Just pause for a minute and think of the complex nature of user profiles and how people implement them on the IBM i platform.  And don’t forget, you may have users on your system who are not highly privileged directly through their user profile, but may be performing administrative tasks related to the CDE.  Identifying everyone with administrative access is a big challenge.

Townsend Security has a multi-factor authentication solution for the IBM i.  How are you helping customers deal with identifying administrators?

From the beginning, we realized this would be a problem and we have taken some additional steps, specifically related to PCI DSS 3.2 to help IBM i customers identify administrators.  We made it possible to build a list of all users who have administrative access and then require them to use multi-factor authentication when logging on.  We have done a lot to help the IBM i security administrator identify highly privileged users and enroll them into a two factor authentication solution, and then periodically monitor/update/audit the list.

What are some of the other multi-factor authentication challenges that IBM i customers face?

Some of them are pretty obvious.  If you don’t have a multi-factor authentication solution in place, there is the effort of evaluating and deploying something on the IBM i server.  You’ll find users who may already have a multi-factor authentication solution in place for their Windows or Linux environments, but haven’t extended it to their IBM i.  Even if they aren’t processing credit card numbers on the IBM i, if it is in the CDE, it still falls within the scope of PCI DSS.

Aside from deploying a solution, there is going to be administrative work involved.  For example, managing the new software, developing new procedures, and putting governance around multi-factor authentication.  Further, if you adopt a hardware-based solution with key FOBs, you have to have processes in place to distribute and replace them, as well as manage the back-end hardware.  It has been really great seeing organizations move to mobile-based authentication solutions based on SMS text messages where there isn’t any hardware of FOBs to manage.  Townsend Security’s Alliance Two Factor Authentication went that route.

Let’s get back to PCI DSS.  As they have done in the past, they announced the updated requirements, but businesses still have a period of time to get compliant.  When does PCI DSS 3.2 actually go into effect?

The PCI SSC always gives merchants and processors time to implement new requirements.  The actual deadline to meet compliance is February 1, 2018.  However, what we are finding is that most merchants are moving rapidly to adopt the requirements now.  When an organization has an upcoming audit or Self Assessment Questionnaire (SAQ) scheduled, they generally will want to meet the compliance requirements for PCI DSS 3.2.  It never is a good idea to wait until the last minute to try and deploy new technology in order to meet compliance.

You mentioned earlier that you have a multi-factor authentication solution.  Tell me a little bit about it.

Sure. Alliance Two Factor Authentication is a mature, cost-effective solution that delivers PINs to your mobile device (or voice phone), rather than through an expensive key FOB system. IBM i customers can significantly improve the security of their IBM i systems through implementation of proven two factor authentication.  Our solution is based on a non-hardware, non-disruptive approach.  Additionally, we audit every successful or failed authentication attempt and log it in the security audit journal (QAUDJRN).  One thing that IBM i customers might also be interested in, is in some cases, we can even extend their existing multi-factor authentication solution to the IBM i with Alliance Two Factor Authentication.  Then they can benefit from the auditing and services that we supply for the IBM i platform.  Our goal was to create a solution that was very cost-effective, rapid to deploy, meets compliance regulations, and doesn’t tip over the IT budget.

Download a podcast of my complete conversation here and learn more about what PCI DSS 3.2 means for IBM i administrators, how to identify administrative users, challenges IBM I customers are facing, and how Townsend Security is helping organizations meet PCI DSS 3.2.

Podcast: IBM i, PCI DSS, and Multi-Factor Authentication

 

Topics: 2FA, IBM i, PCI DSS

Data Protection in the Cloud & PCI DSS - Logs and Log Monitoring (Part 3)

Posted by Patrick Townsend on Mar 18, 2015 9:16:00 AM

This is the third part in our series looking at recent announcements by Amazon, Microsoft and other cloud service providers regarding new encryption and key management services. Let’s talk about log collection and active monitoring as a security best practice, and as a requirement to meet PCI DSS security requirements. Since the PCI DSS guidelines implement common security best practices, they are a good starting point for evaluating the security of any application and platform that processes sensitive data. Following the practice of the first part of this series we will use the PCI document “PCI DSS Cloud Computing Guidelines, Version 2.0” as our reference point, and add in some other sources of security best practices. Even if you don’t have to meet PCI data security requirements, this should be helpful when evaluating your security posture in the cloud.

Download Whitepaper on PCI Data Security

Collecting system logs and actively monitoring them is a core component of every cyber security recommendation. Cybercriminals often gain access to IT systems and go undetected for weeks or months. This gives them the ability to work on compromising systems and stealing data over time. Active monitoring is important in the attempt to detect and thwart this compromise.

Here is what PCI says about active monitoring in Section 10 of the PCI DSS (emphasis added):

Review logs and security events for all system components to identify anomalies or suspicious activity.

Many breaches occur over days or months before being detected. Checking logs daily minimizes the amount of time and exposure of a potential breach. Regular log reviews by personnel or automated means can identify and proactively address unauthorized access to the cardholder data environment. The log review process does not have to be manual. The use of log harvesting, parsing, and alerting tools can help facilitate the process by identifying log events that need to be reviewed.

In recognition of the importance of ongoing, active monitoring the National Institute of Standards and Technology (NIST) provides this guidance in their Special Publication 800-137 “Information Security Continuous Monitoring (ISCM)” guidance:

The Risk Management Framework (RMF) developed by NIST, describes a disciplined and structured process that integrates information security and risk management activities into the system development life cycle. Ongoing monitoring is a critical part of that risk management process. In addition, an organization’s overall security architecture and accompanying security program are monitored to ensure that organization-wide operations remain within an acceptable level of risk, despite any changes that occur. Timely, relevant, and accurate information is vital, particularly when resources are limited and agencies must prioritize their efforts.

And active monitoring is a component of the SANS Top 20 security recommendations:

Collect, manage, and analyze audit logs of events that could help detect, understand, or recover from an attack.

Deficiencies in security logging and analysis allow attackers to hide their location, malicious software, and activities on victim machines. Even if the victims know that their systems have been compromised, without protected and complete logging records they are blind to the details of the attack and to subsequent actions taken by the attackers. Without solid audit logs, an attack may go unnoticed indefinitely and the particular damages done may be irreversible.

Because of poor or nonexistent log analysis processes, attackers sometimes control victim machines for months or years without anyone in the target organization knowing, even though the evidence of the attack has been recorded in unexamined log files.

Deploy a SIEM (Security Incident and Event Management) or log analytic tools for log aggregation and consolidation from multiple machines and for log correlation and analysis.

This is why actively collecting and monitoring system and application logs is critical for your security strategy.

Implementing this critical security control in a cloud environment presents some special challenges. Here is what the PCI cloud guidance says:

Additionally, the ability to maintain an accurate and complete audit trail may require logs from all levels of the infrastructure, requiring involvement from both the CSP and the client. For example, the CSP could manage system-level, operating-system, and hypervisor logs, while the client configures logging for their own VMs and applications. In this scenario, the ability to associate various log files into meaningful events would require correlation of client-controlled logs and those controlled by the CSP.

It is not enough to collect logs from a few selected points in your cloud application environment. You need to collect all of the logs from all of the components that you deploy and use in your cloud application. This is because the effectiveness of active monitoring depends on the correlation of events across your entire application, database, and network and this includes the cloud providers systems and infrastructure. Here is what ISACA says about security event correlation:

Correlation of event data is critical to uncover security breaches because security incidents are made up of a series of events that occur at various touch points throughout a network--a many-to-one process. Unlike network management, which typically is exception-based or a one-to-one process, security management is far more complex. An attack typically touches a network at multiple points and leaves marks or breadcrumbs at each. By finding and following that breadcrumb trail, a security analyst can detect and hopefully prevent the attack.

Your encryption key management system is one of those critical system components that must be monitored and whose events should be aggregated into a unified view. Key management logs would include encryption key establishment and configuration, encryption key access and use, and operating system logs of every component of the key management service. You should be able to collect and monitor logs from all parts of your applications and cloud platform.

Unfortunately, current key management services from cloud providers only provide a very limited level of access to critical component logs. You might have access to a limited audit trail of your own access to encryption keys, but no access to the key service system logs, HSM access logs, HSM audit logs, or HSM operating system logs. Without access to the logs in these components it is not possible for you to implement an effective log collection and active monitoring strategy. You are working in the dark, and without full access to all logs on all components of your cloud key management service you can’t comply with security best practices for log collection, correlation, and active monitoring.

Since key management systems are always in scope for PCI audit and are extensions of your application environment it is difficult to see how these new cloud key management services can meet PCI DSS requirements for log collection and monitoring as currently implemented.

Does this mean you can’t implement security best practices for key management in the cloud? I don’t think so. There are multiple vendors, including us (see below), who offer cloud key management solutions that provide full access to key management, configuration, key usage, application, and operating system logs.  You can deploy a key management service that fully supports security best practices for log collection and monitoring.

In part 4 of this series we’ll look at the topic of key custody and multi-tenancy and how it affects the security of your key management solution in the cloud.

Patrick


Resources

Alliance Key Manager for AWS

Alliance Key Manager for Azure

Alliance Key Manager for VMware and vCloud

Alliance Key Manager for Drupal

 

Alliance Key Manager for IBM Power Sysems

Alliance Key Manager Colud

download the Whitepaper: Meet the Challenges of PCI Compliance

Topics: PCI DSS, Amazon Web Services (AWS), logging, cloud, Microsoft Azure

Data Protection in the Cloud & PCI DSS - Segmentation (Part 2)

Posted by Patrick Townsend on Mar 9, 2015 2:53:00 PM

This is the second part in our series looking at recent announcements by Amazon, Microsoft and others regarding new encryption and key management services. Let’s talk about the concept of segmentation as a security best practice, and as a strong recommendation by PCI DSS security standards. Since the PCI DSS guidelines implement common security best practices they are a good jumping off point for evaluating the security of any application and platform. Following the practice of the first part of this series we will use the PCI document “PCI DSS Cloud Computing Guidelines, Version 2.0” as our reference point. Even if you don’t have to meet PCI data security requirements, this should be helpful when evaluating your security posture in the cloud.

Download Whitepaper on PCI Data Security

Segmentation as a security concept is very simple and very fundamental. Better security can be achieved by not mixing trusted and untrusted applications, data, and networks. This concept of trusted and untrusted applications extends to the value of the data assets – when applications process highly sensitive and valuable data assets they need to be separated into trusted and secure environments. We expend more effort and resources to protect what is valuable from criminals. Conversely, when there are no valuable data assets in an environment there is no need to take the same level of effort to secure them.

This is the core reason that PCI DSS recommends segmentation of applications that process payments from non-payment applications. Here is what PCI says about non-cloud applications:

Outside of a cloud environment, individual client environments would normally be physically, organizationally, and administratively separate from each other.

So, how do the PCI DSS security requirements relate to cloud platforms? Here is what PCI says (emphasis added):

Segmentation on a cloud-computing infrastructure must provide an equivalent level of isolation as that achievable through physical network separation. Mechanisms to ensure appropriate isolation may be required at the network, operating system, and application layers; and most importantly, there should be guaranteed isolation of data that is stored.

Proper segmentation is difficult to achieve even when you have complete control over all aspects of your environment. When you add the inherently shared and multi-tenant architecture of cloud platforms this becomes a high hurdle to get over. Here is what PCI says about this challenge:

Client environments must be isolated from each other such that they can be considered separately managed entities with no connectivity between them. Any systems or components shared by the client environments, including the hypervisor and underlying systems, must not provide an access path between environments. Any shared infrastructure used to house an in-scope client environment would be in scope for that client’s PCI DSS assessment.

This brings us exactly to the concern about new cloud key management services in Azure and AWS. These new services are inherently multi-tenant in both the key management services down to the hardware security modules (HSMs) that provide the ultimate security for encryption keys. You have no idea who you are sharing the service with.

The PCI guidance tells us what this segmentation looks like in a cloud environment:

A segmented cloud environment exists when the CSP enforces isolation between client environments. Examples of how segmentation may be provided in shared cloud environments include, but are not limited to: 

  • Traditional Application Service Provider (ASP) model, where physically separate servers are provided for each client’s cardholder data environment.
  • Virtualized servers that are individually dedicated to a particular client, including any virtualized disks such as SAN, NAS or virtual database servers.
  • Environments where clients run their applications in separate logical partitions using separate database management system images and do not share disk storage or other resources.

There is no cloud service provider implementation of key management services that meet these basic requirements.

The PCI DSS guidance takes a pretty strong view about inadequate segmentation in cloud environments:

If adequate segmentation is not in place or cannot be verified, the entire cloud environment would be in-scope for any one client’s assessment. Examples of “non-segmented” cloud environments include but are not limited to:

  • Environments where organizations use the same application image on the same server and are only separated by the access control system of the operating system or the application.
  • Environments where organizations use different images of an application on the same server and are only separated by the access control system of the operating system or the application.
  • Environments where organizations’ data is stored in the same instance of the database management system’s data store.

Since key management systems are always in scope for PCI audit and are extensions of your application environment and depend entirely on the access control system of the cloud provider, it is difficult to see how these new cloud key management services can meet PCI DSS requirements as currently implemented.

Here’s the last comment by PCI on segmentation in cloud environments:

Without adequate segmentation, all clients of the shared infrastructure, as well as the CSP, would need to be verified as being PCI DSS compliant in order for any one client to be assured of the compliance of the environment. This will likely make compliance validation unachievable for the CSP or any of their clients.

Does this mean you can’t implement security best practices for key management in the cloud? I don’t think so. There are multiple vendors including us (see below) who offer cloud key management solutions that we believe can be effectively isolated and segmented on cloud platforms, or even hosted outside of the cloud.

In our part 3 of this series we’ll look at the topic of logging and active monitoring and how it affects the security of your key management solution in the cloud.

Patrick


Resources

Alliance Key Manager for AWS

Alliance Key Manager for Azure

Alliance Key Manager for VMware and vCloud

Alliance Key Manager for Drupal

Alliance Key Manager for IBM Power Systems

Alliance Key Manager Cloud HSM

download the Whitepaper: Meet the Challenges of PCI Compliance


Topics: PCI DSS, Encryption Key Management, cloud

PCI Compliance and the Assessment Process

Posted by Michelle Larson on Dec 4, 2014 1:30:00 PM

Understanding PCI Merchant Levels and how an assessment can help your business

If your business takes credit cards for payment, then you are subject to the Payment Card Industry – Data Security Standards (PCI-DSS).

Companies of all sizes must comply with PCI DSS to ensure that their customers' data is protected during the processing and transmission of credit or debit card transactions and securely stored within any internal databases. PCI categorizes businesses into different classification levels based on the number of transactions and dollar amounts they processes each year.

Download Whitepaper on PCI Data Security

Level 1 – All merchants processing more than 6 million card transactions annually

Level 2 – All merchants processing between 1 million and 6 million card transactions annually

Level 3 – All merchants processing between 20,000 and 1 million card-not-present only transactions annually

Level 4 – All other merchants

Level 1 companies are most likely well versed in the annual PCI audit process as they have a certified onsite audit annually with a Qualified Security Assessor (QSA). Level 2, 3, 4 merchants are not required to hire an onsite QSA, but can have a certified Internal Security Assessor (ISA) do the PCI self assessment annually. However, a small business preparing a self-assessment to participate in their first PCI review may find it a little daunting. If you're feeling that the PCI assessment process is overwhelming and complicated, understanding this process may be the first step toward putting your mind at ease. If you are a Level 1 merchant, the PCI assessment is a process carried out by a QSA to establish whether or not a business is compliant with security standards relating to the processing of transactions made via a credit or debit card (payment card). PCI compliance assesses your business point of sale system, payment applications, and all interconnecting systems with these goals in mind: (1) to examine your system, (2) to identify vulnerabilities, and (3) to prevent data from being compromised.

It’s not a matter of “IF”, but “WHEN”

If you have already suffered a data breach, working closely to review your assessment and put data security best practices into place will provide you with a roadmap to help avoid future losses. If you have not yet been breached, undergoing an assessment and reviewing your risk tolerance can still be stressful. Understanding the process may alleviate some of that stress and help you to maximize your use of the information in the PCI DSS assessment report

How can a PCI audit help my business?

PCI compliance auditing helps businesses to ensure they are providing the most secure environment for their customers to process payments and ensures that transactions are less likely to result in a compromise in the customers' data.

Ensuring that you meet PCI compliance and have a solid infrastructure for managing data security will increase customer confidence in your business and ensure that you're not exposed to security breaches that could have been avoided. 

To learn more about meeting PCI compliance requirements, download the whitepaper Meet the Challenges of PCI Compliance and find the answers to the following questions (and more):

  • What will my auditor look for?

  • How can I ensure my customers' data is secure?
  • What is the difference between tokenization and encryption?
  • What is encryption key management and why are auditors looking at this?

  download the Whitepaper: Meet the Challenges of PCI Compliance

 


Topics: Compliance, Data Security, PCI DSS, Best Practices, Encryption Key Management, White Paper

How To Meet PCI DSS Compliance With VMware

Posted by Michelle Larson on Sep 25, 2014 3:12:00 PM

Take the right steps to meet compliance in a virtualized environment

VMware encryption key management With executives looking to conserve resources by moving their organizations databases and IT environments to virtualized platforms and to the cloud, there are concerns around virtualized environments. Security best practices and compliance regulations call for sensitive data to be protected with encryption and that data-encrypting keys (DEK) be physically or logically separated from the sensitive data and protected with strong key-encrypting keys (KEK). Depending on what type of information is being stored and what industry guidance your project/company falls under, compliance regulations in addition to PCI DSS may apply.

The Payment Card Industry Data Security Standard (PCI DSS) is one of the most rigorous and specific set of standards established to date and is used by many organizations as a standard to secure their systems. PCI DSS applies to all organizations that store, process, or transmit cardholder data, regardless of volume. This includes merchants, service providers, payment gateways, data centers, and outsourced service providers.

Here is a high level look at all twelve items that must be met in order to be compliant, with three new requirements in PCI DSS 3.0 (**) that warrant mentioning as being most relevant to the use of VMware and cloud technologies in a PCI-regulated infrastructure:

Build and Maintain a Secure Network and Systems
Requirement 1: Install and maintain a firewall configuration to protect cardholder data


(3.0) **Req. 1.1.3: "[Maintain a] current diagram that shows all cardholder data flows across systems and networks."

Requirement 2: Do Not use vendor-supplied defaults for system passwords and other security parameters

(3.0)** Req. 2.4: "Maintain an inventory of system components that are in scope for PCI DSS."

Protect Cardholder Data

Requirement 3: Protect stored cardholder data*


* Requirement 3 specifically addresses the need for encryption and key management, stating:

“Protection methods such as encryption, truncation, masking, and hashing are critical components of cardholder data protection. If an intruder circumvents other security controls and gains access to encrypted data, without the proper cryptographic keys, the data is unreadable and unusable to that person. Other effective methods of protecting stored data should also be considered as potential risk mitigation opportunities. For example, methods for minimizing risk include not storing cardholder data unless absolutely necessary, truncating cardholder data if full PAN is not needed, and not sending unprotected PANs using end-user messaging technologies, such as e-mail and instant messaging.”

Requirement 4: Encrypt transmission of cardholder data across open, public networks

Maintain a Vulnerability Management Program

Requirement 5: Protect all systems against malware and regularly update anti-virus software or programs


Requirement 6: Develop and maintain secure systems and applications

Implement Strong Access Control Measures

Requirement 7: Restrict access to cardholder data by business need-to-know


Requirement 8: Identify and authenticate access to system components


Requirement 9: Restrict physical access to cardholder data

Regularly Monitor and Test Networks

Requirement 10: Track and monitor all access to network resources and cardholder data


Requirement 11: Regularly test security systems and processes

Maintain an Information Security Policy

Requirement 12: Maintain a policy that address information security for all personnel

(3.0) ** Req. 12.8.5: "Maintain information about which PCI DSS requirements are managed by each service provider and which are managed by the entity."

It can seem overwhelming at first, but the PCI Security Standards Council (PCI SSC) website contains this documentation along with a number of additional resources to assist organizations with their PCI DSS assessments and validations. Within the latest documentation by the PCI Security Standards Council (v3.0 released November 2013) specific testing procedures and guidance is given for Requirement 3 on pages 34-43.

Fortunately, there are also standards and published guidance on running payment applications in a virtualized environment:

Payment Card Industry Data Security Standard: Virtualization Guidelines and Cloud Computing Guidelines

NIST SP 800-144: Guidelines on Security and Privacy in Cloud Computing

Cloud Security Alliance: Security Guidance for Critical Areas of Focus in Cloud Computing

While virtual technology is not limited to VMware, it is one of the most commonly used and supported architectures by many cloud service providers. In addition to the PCI compliance and cloud guidelines above, VMware worked with CoalFire, a QSA auditing firm, to create guidance on how to specifically deploy payment applications in a VMware environment. You can access the CoalFire document from the VMware website here.

As platform virtualization becomes a more popular solution, executives need to remain vigilant with their data security and meeting compliance requirements. We can help make the transition to VMware easy with our Alliance Key Manager for VMware solution, which meets the PCI recommendations when deployed properly in a VMware environment. We are committed to helping businesses protect sensitive data with industry standard NIST compliant AES encryption and FIPS 140-2 compliant encryption key management solutions.


To learn more about enterprise key management for VMware and vCloud, download our podcast "Virtualized Encryption Key Management".

Podcast: Virtualized Encryption Key Management
 

Topics: Alliance Key Manager, PCI DSS, Encryption Key Management, VMware, Virtualized Encryption Key Management, Podcast, PCI, Cloud Security

PCI DSS Compliance = Encryption & Key Management

Posted by Michelle Larson on Jul 1, 2014 2:13:00 PM

Many compliance regulations and security best practices require the encryption of sensitive data and the protection of encryption keys with proper key management.

Security best practices and PCI DSS compliance regulations call for sensitive data to be protected with encryption and that data-encrypting keys (DEK) be physically or logically separated from the sensitive data and protected with strong key-encrypting keys (KEK). Anyone who needs to protect sensitive data in their database, needs to know that storing the encryption keys within the same location puts data at risk for a breach.  Depending on what type of information is being stored and what industry guidance your project/company falls under, compliance regulations in addition to PCI DSS may apply.


PCI Compliance Regulations require encryption and key management

For any company that accepts credit card payments, the Payment Card Industry Data Security Standards (PCI DSS) issues 12 requirements that must be met in order to be compliant. It can seem overwhelming at first, but the PCI council that issues PCI DSS also provides detailed reference guides and instructions on each requirement.

Let’s take a brief look at all twelve items:

Build and Maintain a Secure Network and Systems

Requirement 1: Install and maintain a firewall configuration to protect cardholder data

Requirement 2: Do Not use vendor-supplied defaults for system passwords and other security parameters

Protect Cardholder Data

Requirement 3: Protect stored cardholder data*

Requirement 4: Encrypt transmission of cardholder data across open, public networks

Maintain a Vulnerability Management Program

Requirement 5: Protect all systems against malware and regularly update anti-virus software or programs

Requirement 6: Develop and maintain secure systems and applications

Implement Strong Access Control Measures

Requirement 7: Restrict access to cardholder data by business need-to-know

Requirement 8: Identify and authenticate access to system components

Requirement 9: Restrict physical access to cardholder data

Regularly Monitor and Test Networks

Requirement 10: Track and monitor all access to network resources and cardholder data

Requirement 11: Regularly test security systems and processes

Maintain an Information Security Policy

Requirement 12: Maintain a policy that address information security for all personnel


Within the latest documentation by the PCI Security Standards Council (v3.0 released November 2013) specific testing procedures and guidance is given for Requirement 3 on pages 34-43. The PCI Security Standards Council (PCI SSC) website (http://www.pcisecuritystandards.org) contains this documentation along with a number of additional resources to assist organizations with their PCI DSS assessments and validations.

* Requirement 3 addresses the need for encryption and key management, stating:

Protection methods such as encryption, truncation, masking, and hashing are critical components of cardholder data protection. If an intruder circumvents other security controls and gains access to encrypted data, without the proper cryptographic keys, the data is unreadable and unusable to that person. Other effective methods of protecting stored data should also be considered as potential risk mitigation opportunities. For example, methods for minimizing risk include not storing cardholder data unless absolutely necessary, truncating cardholder data if full PAN is not needed, and not sending unprotected PANs using end-user messaging technologies, such as e-mail and instant messaging.”


The PCI Security Standards Council also issues their Cloud Computing Guidelines (https://www.pcisecuritystandards.org/pdfs/PCI_DSS_v2_Cloud_Guidelines.pdf) and additional information around virtualization of data protection solutions so you can be PCI compliant with a cloud-based solution for encryption and key management.


Other compliance requirements for protecting information go beyond cardholder data (PCI focuses on PAN or the Primary Account Number specifically) and also require that personally identifiable information (PII) such as names, birthdates, email address, zip codes, usernames, or passwords be protected properly with encryption and key management. To meet the growing need for NIST validated and FIPS 140-2 compliant solutions, the data security experts at Townsend Security provide a certified key management system (Alliance Key Manager) which provides secure key storage and retrieval options for a variety of Enterprise and open source platforms.  Now sensitive information can easily be encrypted and the encryption keys properly managed. 

For more information on encryption, download the latest eBook, The Encryption Guide:

The Encryption Guide eBook

Topics: Compliance, Encryption, eBook, PCI DSS, Encryption Key Management

Drupal CMS and PCI DSS Compliance

Posted by Michelle Larson on Apr 2, 2014 11:14:00 AM

Securing data with encryption and protecting the encryption keys with proper key management is addressed in many compliance regulations and security best practices.

Download Whitepaper on PCI Data Security For Drupal developers who need to protect sensitive data in their (or their clients) content management system (CMS), storing the encryption keys within the Drupal CMS puts that data at risk for a breach. Security best practices and PCI DSS compliance regulations call for sensitive data to be protected with encryption and that data-encrypting keys (DEK) be physically or logically separated from the sensitive data and protected with strong key-encrypting keys (KEK).  Depending on what type of information is being stored and what industry guidance your project/company falls under, compliance regulations in addition to PCI DSS may apply.

For any company that accepts credit card payments, the Payment Card Industry Data Security Standards (PCI DSS) issues 12 requirements that must be met in order to be compliant. It can seem overwhelming at first, but the PCI council that issues PCI DSS also provides detailed reference guides and instructions on each requirement. Let’s take a high level look at all twelve items:

Build and Maintain a Secure Network and Systems

Requirement 1: Install and maintain a firewall configuration to protect cardholder data
Requirement 2: Do Not use vendor-supplied defaults for system passwords and other security parameters

Protect Cardholder Data

Requirement 3: Protect stored cardholder data*
Requirement 4: Encrypt transmission of cardholder data across open, public networks

Maintain a Vulnerability Management Program

Requirement 5: Protect all systems against malware and regularly update anti-virus software or programs
Requirement 6: Develop and maintain secure systems and applications

Implement Strong Access Control Measures

Requirement 7: Restrict access to cardholder data by business need-to-know
Requirement 8: Identify and authenticate access to system components
Requirement 9: Restrict physical access to cardholder data

Regularly Monitor and Test Networks

Requirement 10: Track and monitor all access to network resources and cardholder data
Requirement 11: Regularly test security systems and processes

Maintain an Information Security Policy

Requirement 12: Maintain a policy that address information security for all personnel

Within the latest documentation by the PCI Security Standards Council (v3.0 released November 2013) specific testing procedures and guidance is given for Requirement 3 on pages 34-43. The PCI Security Standards Council (PCI SSC) website contains this documentation along with a number of additional resources to assist organizations with their PCI DSS assessments and validations. PCI SSC also issues Cloud Computing Guidelines and additional information around virtualization of data protection solutions so you can be PCI compliant with a cloud-based solution for encryption and key management.

Requirement 3 addresses the need for encryption and key management, stating:

PCI requirement 3:Protect stored cardholder data

“Protection methods such as encryption, truncation, masking, and hashing are critical components of cardholder data protection. If an intruder circumvents other security controls and gains access to encrypted data, without the proper cryptographic keys, the data is unreadable and unusable to that person. Other effective methods of protecting stored data should also be considered as potential risk mitigation opportunities. For example, methods for minimizing risk include not storing cardholder data unless absolutely necessary, truncating cardholder data if full PAN is not needed, and not sending unprotected PANs using end-user messaging technologies, such as e-mail and instant messaging.”

In order to address PCI DSS Requirement 3: Protect stored cardholder data; the security experts at Townsend Security partnered with Chris Teitzel, CEO of Cellar Door Media and Drupal developer to create Key Connection for Drupal in connection with the existing Drupal Encrypt module. In order to provide secure key storage and retrieval options, Key Connection for Drupal provides a secure key management system (Alliance Key Manager) outside of the Drupal installation. Now when cardholder information is collected or stored in a database it can easily be encrypted and the encryption keys properly managed. Key Connection for Drupal allows developers and users to choose whether they need to retrieve a key and encrypt/decrypt locally or to send the data to Alliance Key Manager to perform on board encryption.

Other compliance requirements for protecting information go beyond cardholder data (PCI focuses on PAN or the Primary Account Number specifically) and also require that personally identifiable information (PII) such as names, birthdates, email address, zip codes, usernames, or passwords be protected with encryption and key management. Check back as future blogs will cover additional data privacy compliance regulations and security best practices that impact developers and users of the Drupal CMS open source platform in regards to protected health information (PHI).

For more information on PCI Compliance, download the Whitepaper: "Meet the Challenges of PCI Compliance"

download the Whitepaper: Meet the Challenges of PCI Compliance

Topics: Compliance, PCI DSS, Encryption Key Management, White Paper, Drupal

Authentication Called For By PCI DSS, HIPAA/HITECH, and GLBA/FFIEC

Posted by Michelle Larson on Mar 24, 2014 2:13:00 PM

Two Factor Authentication (2FA) and a look at the compliance regulations that require identity verification for remote access.

Request the Two Factor Authentication Resource Kit Now!

The use of two factor authentication provides an added layer of security beyond just a username and password. Because passwords can be guessed, stolen, hacked, or given away, they are a weak layer of security if used alone. Since frequent access happens from outside of the network, remote login is considered high-risk and requires additional steps to confirm user identity. Protecting access with two factor authentication adds identity assurance and significantly reduces risk of unauthorized access in the retail, healthcare, and financial industries.

Payment Card Industry Data Security Standards (PCI DSS)

The PCI Security Standards Council has stated that they will continue to change and evolve compliance regulations over time as attacks change. In PCI DSS section 8.3 the requirement states that organizations must “incorporate two factor authentication for remote access (network-level access originating from outside the network) to the network by employees, administrators, and third parties.”  The objective of this requirement is to ensure that merchants implement strong access control measures so that authorized individuals with network and computer access can be identified, monitored, and traced.

Requirement 8: Assign a unique ID to each person with computer access. Assigning a unique identification (ID) to each person with access ensures that each individual is uniquely accountable for his or her actions. When such accountability is in place, actions taken on critical data and systems are performed by, and can be traced to, known and authorized users.

Note: These requirements are applicable for all accounts, including point-of-sale accounts, with administrative capabilities and all accounts used to view or access cardholder data or to access systems with cardholder data.

Requirement 8.3: Incorporate two factor authentication for remote access (network-level access originating from outside the network) to the network by employees, administrators, and third parties.

Note: Two factor authentication requires that two of the three authentication methods (something you know - something you have - something you are) be used for authentication. Using one factor twice (for example, using two separate passwords) is not considered two factor authentication.

Health Insurance Portability and Accountability Act (HIPAA) and the Health Information Technology for Economic and Clinical Health (HITECH) Act

HIPAA was an act signed in 1996 by President Bill Clinton, meant to improve the efficiency of the healthcare system by encouraging the use of Electronic Data Interchange (EDI) when accessing Protected Health Information (PHI). Covered entities must develop and implement policies and procedures for authorizing PHI access in accordance with the HIPAA Security Rule Administrative Safeguards 164.308(a)(4) [Information Access Management: Access Authorization] and Technical Safeguards 164.312(d) [Person or Entity Authentication] and the HIPAA Privacy Rule at §164.508 [Uses and disclosures for which an authorization is required].

The HIPAA Security Rule requirements have most recently been expanded via the HITECH Act, which establishes mandatory federal security breach reporting requirements with expanded criminal and civil penalties for non-compliance. To remain HIPAA compliant and avoid fines for HITECH Act non-compliance, strict control over access to patient records must be demonstrated.

HIPAA/HITECH requirements regarding the transmission of health-related information include adequate encryption [164.312(e)(2)(ii) when appropriate, and 164.312(a)(2)(iv)], authentication [164.312(d)] or unique user identification [164.312(a)(2)(i)] of communication partners. By selecting Two Factor Authentication (2FA), users would be required to combine something they know, something they have, or something they are; thereby providing more secure access to PHI files. Protected Health Information can be account numbers, medical record numbers and geographic indicators among other private consumer information. It is important that only those health care workforce members who have been trained and have proper authorization are granted access to PHI.

Gramm-Leach-Bliley Act (GLBA) & Federal Financial Institutions Examination Council (FFIEC)

The Federal Financial Institutions Examination Council (FFIEC) is charged with providing specific guidelines for evaluating financial institutions for GLBA (Gramm-Leach-Bliley Act) regulations compliance. The FFIEC also provides guidance around the use of two factor authentication to strengthen systems in the financial industry and strengthen banking websites against financial fraud with the document, “Authentication in an Internet Banking Environment” (v.3). For banks offering internet-based financial services, the guidance document describes enhanced authentication methods that regulators expect banks to use when authenticating the identity of customers using online products and services, as follows:

  • Financial institutions offering internet-based products and services to their customers should use effective methods to authenticate the identity of customers using those products and services. Furthermore, the FFIEC considers single-factor authentication (as the only control mechanism) to be inadequate for high-risk transactions involving access to customer information or the movement of funds to other parties.
  • The implementation of appropriate authentication methodologies should start with an assessment of the risk posed by the institutions’ Internet banking systems. The authentication techniques employed by the financial institution should be appropriate to the risks associated with those products and services.
  • Account fraud and identity theft are frequently the result of single-factor (e.g. ID/password) authentication exploitation.
  • Where risk assessments indicate that the use of single factor authentication is inadequate, financial institutions should implement multi-factor authentication, layered security, or other controls reasonably calculated to mitigate those risks.

The FFIEC is a government agency which works with many other government agencies to unify how financial institutions should be supervised. The guideline documents recommend banks treat the FFIEC as baseline compliance for safe online authentication and transaction verification. Since all single factor authentication techniques can be easily compromised, financial institutions should not rely solely on any single control for authorizing high risk transactions, but rather institute a system of layered security with multi-factor authentication.

Although there are varying levels of enforcement, guidelines vs. laws vs. fines, it is clear that two factor authentication plays a critical security role in both compliance and following best practices. This trend will only grow within various industries and throughout the overall data security environment.

Townsend Security offers Easy to Deploy, Cost Effective Two Factor Authentication Solution for the IBM i Platform

Alliance Two Factor Authentication brings mobile SMS and voice verification to the IBM i platform. The solution was built to solve large scale problems in a cost-effective manner and appropriately addresses the concerns raised in the various guidelines and standards listed above. Remote access to networks containing critical payment, patient information, or financial records can be protected with the Alliance 2FA solution using your mobile phone to receive authentication codes.

For more information, request our 2FA Resource Kit! 

Request the Resource Kit on Two Factor Authentication

Topics: Compliance, HITECH, PCI DSS, HIPAA, Resource Kit, Alliance Two Factor Authentication, GLBA/FFIEC

What You Need to Know About PCI DSS v3.0

Posted by Liz Townsend on Jan 3, 2014 1:36:00 PM
Quote from PCI SSC

Every few years since its inception in 2006 the Payment Card Industry Security Standards Council (PCI SSC) has revised and updated the the Payment Card Industry Data Security Standards (PCI DSS) and Payment Application Data Security Standards (PA DSS) to improve security for the payment card industry worldwide. These revisions, clarifications, and new points of guidance are based on considerations and recommendations by experts in the field of data security as well as over 700 organizations that process cardholder data. At the end of their review period, the PCI SSC concluded that revisions needed to be made based on these problematic themes in the payment card industry:

  • Lack of education and awareness of how to implement and maintain PCI standards - a major problem since the improper implementation of PCI standards leads to data loss and breaches
  • Weak passwords and authentication
  • Lack of consistency of responsibility when implementing necessary third party security features
  • Slow detection of threats
  • Inconsistency of PCI assessments1

Since the release of v3.0 in November 2013, many organizations affected by PCI DSS and PA DSS are asking: Are there new revisions regarding encryption and key management in v3.0, and what do I need to do in order to meet new recommendations, regulations, and best practices? Luckily, much of version 3.0 hasn’t changed from 2.0. However, many important clarifications have been made. In section 3 of PCI DSS (the section pertaining to encryption and management of encryption keys), version 3.0 makes clarifications regarding these aspects of encryption and key management2:

  • Stricter controls around the protection and deletion of authentication data
  • Key management procedures must be both implemented and documented
  • The requirement of PAN masking
  • The critical use of dual control and split knowledge
  • The mandate that logical access for disk encryption must be managed separately and independently of the native operating system authentication and access control mechanisms, and that decryption keys must not be associated with user accounts.

Version 3.0 has also split requirement 3.5.2 into two separate requirements to emphasize the importance of both storing encryption keys in a secure location (3.5.2) as well as in the fewest possible locations (3.5.3)2

Based on the themes they found and the revisions made, it is clear that the PCI SSC is moving toward making their regulations stricter. What’s even more interesting is that in this last review, more than half of the recommendations were taken from experts and organizations outside of the United States. This is likely because the United States is farther behind other countries such as the European Union in terms of credit card data security, and since the PCI SSC sets worldwide regulations, they must set standards that meet the highest expectations.

We recommend all organizations worldwide look to the highest standards and follow best practices and recommendations (whether they are required or not) since these evolving requirements are based on current conditions and threats in the data security world and indicate future hardened regulations.

To learn more about encryption key management best practices download NIST Special Publication 800-57 “Recommendations for Key Management: Parts 1, 2 & 3” 

1 PA-DSS & PCI DSS change highlights

2 PCI DSS 3.0 summary of changes


Topics: Compliance, PCI DSS, Best Practices, PCI, PCI SSC


Subscribe to Email Updates

Posts by Topic

see all