Chapter

13
Security and Ethical Challenges

McGraw-Hill/Irwin

Copyright 2008, The McGraw-Hill Companies, Inc. All rights reserved.

Learning Objectives
Identify several ethical issues in how the use
of information technologies in business affects

Employment
Individuality
Working conditions
Privacy
Crime
Health
Solutions to societal problems

13-2

Learning Objectives
Identify several types of security management
strategies and defenses, and explain how they
can be used to ensure the security of business
applications of information technology

Propose several ways that business managers

and professionals can help to lessen the harmful
effects and increase the beneficial effects of the
use of information technology

13-3

Case 1: Cyberscams and Cybercriminals

Cyberscams are todays fastest-growing
criminal niche
87 percent of companies surveyed reported
a security incident
The U.S. Federal Trade Commission says
identity theft is its top complaint
eBay has 60 people combating fraud;
Microsoft has 65
Stolen credit card account numbers are
regularly sold online
13-4

Case Study Questions

What are several reasons why cyberscams
are todays fastest-growing criminal niche?
Explain why the reasons you give contribute
to the growth of cyberscams

What are several security measures that could

be implemented to combat the spread of
cyberscams?
Explain why your suggestions would be
effective in limiting the spread of cyberscams

13-5

Case Study Questions

Which one or two of the four top cybercriminals
described in this case poses the greatest threat to
businesses? To consumers?
Explain the reasons for your choices, and how
businesses and consumers can protect themselves
from these cyberscammers

13-6

IT Security, Ethics, and Society

13-7

IT Security, Ethics, and Society

Information technology has both beneficial
and detrimental effects on society and people
Manage work activities to minimize the
detrimental effects of information technology
Optimize the beneficial effects

13-8

Business Ethics
Ethics questions that managers confront as part
of their daily business decision making include

Equity
Rights
Honesty
Exercise of corporate power

13-9

Categories of Ethical Business Issues

13-10

Corporate Social Responsibility Theories

Stockholder Theory
Managers are agents of the stockholders
Their only ethical responsibility is to increase
the profits of the business without violating the
law or engaging in fraudulent practices

Social Contract Theory

Companies have ethical responsibilities to all
members of society, who allow corporations
to exist

13-11

Corporate Social Responsibility Theories

Stakeholder Theory
Managers have an ethical responsibility to
manage a firm for the benefit of all its
stakeholders
Stakeholders are all individuals and groups
that have a stake in, or claim on, a company

13-12

Principles of Technology Ethics

Proportionality
The good achieved by the technology must
outweigh the harm or risk; there must be no
alternative that achieves the same or
comparable benefits with less harm or risk

Informed Consent
Those affected by the technology should
understand and accept the risks

13-13

Principles of Technology Ethics

Justice
The benefits and burdens of the technology
should be distributed fairly.
Those who benefit should bear their fair share
of the risks, and those who do not benefit should
not suffer a significant increase in risk

Minimized Risk
Even if judged acceptable by the other three
guidelines, the technology must be implemented
so as to avoid all unnecessary risk
13-14

AITP Standards of Professional Conduct

13-15

Responsible Professional Guidelines

A responsible professional

Acts with integrity

Increases personal competence
Sets high standards of personal performance
Accepts responsibility for his/her work
Advances the health, privacy, and general
welfare of the public

13-16

Computer Crime
Computer crime includes
Unauthorized use, access, modification, or
destruction of hardware, software, data, or
network resources
The unauthorized release of information
The unauthorized copying of software
Denying an end user access to his/her own
hardware, software, data, or network resources
Using or conspiring to use computer or network
resources illegally to obtain information or
tangible property
13-17

Cybercrime Protection Measures

13-18

Hacking
Hacking is
The obsessive use of computers
The unauthorized access and use of networked
computer systems

Electronic Breaking and Entering

Hacking into a computer system and reading
files, but neither stealing nor damaging anything

Cracker
A malicious or criminal hacker who maintains
knowledge of the vulnerabilities found for
private advantage
13-19

Common Hacking Tactics

Denial of Service
Hammering a websites equipment with too
many requests for information
Clogging the system, slowing performance,
or crashing the site

Scans
Widespread probes of the Internet to determine
types of computers, services, and connections
Looking for weaknesses

13-20

Common Hacking Tactics

Sniffer
Programs that search individual packets of
data as they pass through the Internet
Capturing passwords or entire contents

Spoofing
Faking an e-mail address or Web page to trick
users into passing along critical information
like passwords or credit card numbers

13-21

Common Hacking Tactics

Trojan House
A program that, unknown to the user, contains
instructions that exploit a known vulnerability
in some software

Back Doors
A hidden point of entry to be used in case the
original entry point is detected or blocked

Malicious Applets
Tiny Java programs that misuse your computers
resources, modify files on the hard disk, send
fake email, or steal passwords
13-22

Common Hacking Tactics

War Dialing
Programs that automatically dial thousands of
telephone numbers in search of a way in through
a modem connection

Logic Bombs
An instruction in a computer program that
triggers a malicious act

Buffer Overflow
Crashing or gaining control of a computer by
sending too much data to buffer memory
13-23

Common Hacking Tactics

Password Crackers
Software that can guess passwords

Social Engineering
Gaining access to computer systems by talking
unsuspecting company employees out of
valuable information, such as passwords

Dumpster Diving
Sifting through a companys garbage to find
information to help break into their computers

13-24

Cyber Theft
Many computer crimes involve the theft of
money
The majority are inside jobs that involve
unauthorized network entry and alternation
of computer databases to cover the tracks
of the employees involved
Many attacks occur through the Internet
Most companies dont reveal that they have
been targets or victims of cybercrime
13-25

Unauthorized Use at Work

Unauthorized use of computer systems and
networks is time and resource theft

Doing private consulting

Doing personal finances
Playing video games
Unauthorized use of the Internet or company
networks

Sniffers
Used to monitor network traffic or capacity
Find evidence of improper use
13-26

Internet Abuses in the Workplace

General email abuses

Unauthorized usage and access
Copyright infringement/plagiarism
Newsgroup postings
Transmission of confidential data
Pornography
Hacking
Non-work-related download/upload
Leisure use of the Internet
Use of external ISPs
Moonlighting
13-27

Software Piracy
Software Piracy
Unauthorized copying of computer programs

Licensing
Purchasing software is really a payment
for a license for fair use
Site license allows a certain number of copies
A third of the software
industrys revenues are
lost to piracy

13-28

Theft of Intellectual Property

Intellectual Property
Copyrighted material
Includes such things as music, videos, images,
articles, books, and software

Copyright Infringement is Illegal

Peer-to-peer networking techniques have made
it easy to trade pirated intellectual property

Publishers Offer Inexpensive Online Music

Illegal downloading of music and video is
down and continues to drop
13-29

Viruses and Worms

A virus is a program that cannot work without
being inserted into another program
A worm can run unaided

These programs copy annoying or destructive

routines into networked computers
Copy routines spread the virus

Commonly transmitted through

The Internet and online services

Email and file attachments
Disks from contaminated computers
Shareware
13-30

Top Five Virus Families of all Time

My Doom, 2004
Spread via email and over Kazaa file-sharing
network
Installs a back door on infected computers
Infected email poses as returned message or one
that cant be opened correctly, urging recipient
to click on attachment
Opens up TCP ports that stay open even after
termination of the worm
Upon execution, a copy of Notepad is opened,
filled with nonsense characters
13-31

Top Five Virus Families of all Time

Netsky, 2004
Mass-mailing worm that spreads by emailing
itself to all email addresses found on infected
computers
Tries to spread via peer-to-peer file sharing
by copying itself into the shared folder
It renames itself to pose as one of 26 other
common files along the way

13-32

Top Five Virus Families of all Time

SoBig, 2004
Mass-mailing email worm that arrives as
an attachment
Examples: Movie_0074.mpg.pif, Document003.pif

Scans all .WAB, .WBX, .HTML, .EML, and

.TXT files looking for email addresses to
which it can send itself
Also attempts to download updates for itself

13-33

Top Five Virus Families of all Time

Klez, 2002
A mass-mailing email worm that arrives
with a randomly named attachment
Exploits a known vulnerability in MS
Outlook to auto-execute on unpatched clients
Tries to disable virus scanners and then copy
itself to all local and networked drives with a
random file name
Deletes all files on the infected machine and
any mapped network drives on the 13th of all
even-numbered months
13-34

Top Five Virus Families of all Time

Sasser, 2004
Exploits a Microsoft vulnerability to spread
from computer to computer with no user
intervention
Spawns multiple threads that scan local subnets
for vulnerabilities

13-35

The Cost of Viruses, Trojans, Worms

Cost of the top five virus families
Nearly 115 million computers in 200 countries
were infected in 2004
Up to 11 million computers are believed to
be permanently infected
In 2004, total economic damage from virus
proliferation was $166 to $202 billion
Average damage per computer is between
$277 and $366

13-36

Adware and Spyware

Adware
Software that purports to serve a useful purpose,
and often does
Allows advertisers to display pop-up and banner
ads without the consent of the computer users

Spyware
Adware that uses an Internet connection in the
background, without the users permission
or knowledge
Captures information about the user and sends
it over the Internet
13-37

Spyware Problems
Spyware can steal private information and also

Add advertising links to Web pages

Redirect affiliate payments
Change a users home page and search settings
Make a modem randomly call premium-rate
phone numbers
Leave security holes that let Trojans in
Degrade system performance

Removal programs are often not completely

successful in eliminating spyware
13-38

Privacy Issues
The power of information technology to store
and retrieve information can have a negative
effect on every individuals right to privacy
Personal information is collected with every
visit to a Web site
Confidential information stored by credit
bureaus, credit card companies, and the
government has been stolen or misused

13-39

Opt-in Versus Opt-out

Opt-In
You explicitly consent to allow data to be
compiled about you
This is the default in Europe

Opt-Out
Data can be compiled about you unless you
specifically request it not be
This is the default in the U.S.

13-40

Privacy Issues
Violation of Privacy
Accessing individuals private email
conversations and computer records
Collecting and sharing information about
individuals gained from their visits to
Internet websites

Computer Monitoring
Always knowing where a person is
Mobile and paging services are becoming more
closely associated with people than with places
13-41

Privacy Issues
Computer Matching
Using customer information gained from many
sources to market additional business services

Unauthorized Access of Personal Files

Collecting telephone numbers, email addresses,
credit card numbers, and other information to
build customer profiles

13-42

Protecting Your Privacy on the Internet

There are multiple ways to protect your privacy
Encrypt email
Send newsgroup postings through anonymous
remailers
Ask your ISP not to sell your name and
information to mailing list providers and
other marketers
Dont reveal personal data and interests on
online service and website user profiles

13-43

Privacy Laws
Electronic Communications Privacy Act
and Computer Fraud and Abuse Act
Prohibit intercepting data communications
messages, stealing or destroying data, or
trespassing in federal-related computer systems

U.S. Computer Matching and Privacy Act

Regulates the matching of data held in
federal agency files to verify eligibility
for federal programs

13-44

Privacy Laws
Other laws impacting privacy and how
much a company spends on compliance
Sarbanes-Oxley
Health Insurance Portability and
Accountability Act (HIPAA)
Gramm-Leach-Bliley
USA Patriot Act
California Security Breach Law
Securities and Exchange Commission rule 17a-4

13-45

Computer Libel and Censorship

The opposite side of the privacy debate
Freedom of information, speech, and press

Biggest battlegrounds
Bulletin boards
Email boxes
Online files of Internet and public networks

Weapons used in this battle

Spamming
Flame mail
Libel laws
Censorship
13-46

Computer Libel and Censorship

Spamming
Indiscriminate sending of unsolicited email
messages to many Internet users

Flaming
Sending extremely critical, derogatory, and often
vulgar email messages or newsgroup posting to
other users on the Internet or online services
Especially prevalent on special-interest
newsgroups

13-47

Cyberlaw
Laws intended to regulate activities over
the Internet or via electronic communication
devices
Encompasses a wide variety of legal and
political issues
Includes intellectual property, privacy,
freedom of expression, and jurisdiction

13-48

Cyberlaw
The intersection of technology and the law
is controversial
Some feel the Internet should not be regulated
Encryption and cryptography make traditional
form of regulation difficult
The Internet treats censorship as damage and
simply routes around it

Cyberlaw only began to emerge in 1996

Debate continues regarding the applicability
of legal principles derived from issues that
had nothing to do with cyberspace
13-49

Other Challenges
Employment
IT creates new jobs and increases productivity
It can also cause significant reductions in job
opportunities, as well as requiring new job skills

Computer Monitoring
Using computers to monitor the productivity
and behavior of employees as they work
Criticized as unethical because it monitors
individuals, not just work, and is done constantly
Criticized as invasion of privacy because many
employees do not know they are being monitored
13-50

Other Challenges
Working Conditions
IT has eliminated monotonous or obnoxious tasks
However, some skilled craftsperson jobs have
been replaced by jobs requiring routine,
repetitive tasks or standby roles

Individuality
Dehumanizes and depersonalizes activities
because computers eliminate human relationships
Inflexible systems

13-51

Health Issues
Cumulative Trauma Disorders (CTDs)
Disorders suffered by people who sit at a
PC or terminal and do fast-paced repetitive
keystroke jobs

Carpal Tunnel Syndrome

Painful, crippling ailment of the hand
and wrist
Typically requires surgery to cure

13-52

Ergonomics
Designing healthy work environments
Safe, comfortable, and pleasant for people
to work in
Increases employee morale and productivity
Also called human factors engineering

13-53

Ergonomics Factors

13-54

Societal Solutions
Using information technologies to solve
human and social problems

Medical diagnosis
Computer-assisted instruction
Governmental program planning
Environmental quality control
Law enforcement
Job placement

13-55

Societal Solutions
The detrimental effects of
information technology
Often caused by individuals
or organizations not
accepting ethical
responsibility for
their actions

13-56

Security Management of IT
The Internet was developed for inter-operability,
not impenetrability
Business managers and professionals alike
are responsible for the security, quality, and
performance of business information systems
Hardware, software, networks, and data
resources must be protected by a variety
of security measures

13-57

Case 2: Data Security Failures

Security Breach Headlines
Identity thieves stole information on 145,000
people from ChoicePoint
Bank of America lost backup tapes that held
data on over 1 million credit card holders
DSW had its stores credit card data breached;
over 1 million had been accessed

Corporate America is finally owning up to

a long-held secret
It cant safeguard its most valuable data
13-58

Case Study Questions

Why have there been so many recent incidents
of data security breaches and loss of customer
data by reputable companies?
What security safeguards must companies have
to deter electronic break-ins into their computer
networks, business applications, and data
resources like the incident at Lowes?

13-59

Case Study Questions

What security safeguards would have deterred
the loss of customer data at
TCI
Bank of America
ChoicePoint?

13-60

Security Management
The goal of security
management is the
accuracy, integrity,
and safety of all
information system
processes and resources

13-61

Internetworked Security Defenses

Encryption
Data is transmitted in scrambled form
It is unscrambled by computer systems for
authorized users only
The most widely used method uses a pair of
public and private keys unique to each individual

13-62

Public/Private Key Encryption

13-63

Internetworked Security Defenses

Firewalls
A gatekeeper system that protects a companys
intranets and other computer networks from
intrusion
Provides a filter and safe transfer point for
access to/from the Internet and other networks
Important for individuals who connect to the
Internet with DSL or cable modems
Can deter hacking, but cannot prevent it

13-64

Internet and Intranet Firewalls

13-65

Denial of Service Attacks

Denial of service attacks depend on three
layers of networked computer systems
The victims website
The victims Internet service provider
Zombie or slave computers that have been
commandeered by the cybercriminals

13-66

Defending Against Denial of Service

At Zombie Machines
Set and enforce security policies
Scan for vulnerabilities

At the ISP
Monitor and block traffic spikes

At the Victims Website

Create backup servers and network connections

13-67

Internetworked Security Defenses

Email Monitoring
Use of content monitoring software that scans
for troublesome words that might compromise
corporate security

Virus Defenses
Centralize the updating and distribution of
antivirus software
Use a security suite that integrates virus
protection with firewalls, Web security,
and content blocking features
13-68

Other Security Measures

Security Codes
Multilevel password system
Encrypted passwords
Smart cards with microprocessors

Backup Files
Duplicate files of data or programs

Security Monitors
Monitor the use of computers and networks
Protects them from unauthorized use, fraud,
and destruction
13-69

Other Security Measures

Biometrics
Computer devices measure physical traits
that make each individual unique
Voice recognition, fingerprints, retina scan

Computer Failure Controls

Prevents computer failures or minimizes
its effects
Preventive maintenance
Arrange backups with a disaster recovery
organization
13-70

Other Security Measures

In the event of a system failure, fault-tolerant
systems have redundant processors, peripherals,
and software that provide
Fail-over capability: shifts to back up
components
Fail-save capability: the system continues
to operate at the same level
Fail-soft capability: the system continues
to operate at a reduced but acceptable level

13-71

Other Security Measures

A disaster recovery plan contains formalized
procedures to follow in the event of a disaster
Which employees will participate
What their duties will be
What hardware, software, and facilities
will be used
Priority of applications that will be processed
Use of alternative facilities
Offsite storage of databases

13-72

Information System Controls

Methods and devices that attempt to ensure the
accuracy, validity, and propriety of information
system activities

13-73

Auditing IT Security
IT Security Audits
Performed by internal or external auditors
Review and evaluation of security measures
and management policies
Goal is to ensure that that proper and adequate
measures and policies are in place

13-74

Protecting Yourself from Cybercrime

13-75

Case 3: Managing Information Security

OCTAVE Security Process Methodology
Risk Evaluation

Self-direction by people in the organization

Adaptable measures that can change with technology
A defined process and standard evaluation procedures
A foundation for a continual process that improves
security over time

Risk Management
A forward-looking view
A focus on a critical few security issues
Integrated management of security policies and
strategies
13-76

Case 3: Managing Information Security

Organizational and Cultural
Open communication of risk information and
activities build around collaboration
A global perspective on risk in the context of the
organizations mission and business objectives
Teamwork

13-77

Case Study Questions

What are security managers doing to improve
information security?
How does the OCTAVE methodology work
to improve security in organizations?
What does Lloyd Hession mean when he says
information security is not addressed simply
by the firewalls and antivirus tools that are
already in place?

13-78

Case 4: Maintaining Software Security

Security professionals have 7 to 21 days before
hackers tools used to exploit the most recent
vulnerabilities become available on the Internet
Microsofts monthly patch-release date is
known as Patch Tuesday
Security software companies go to work
immediately to update their products
Update must be thoroughly tested before
being deployed

13-79

Case Study Questions

What types of security problems are typically
addressed by a patch-management strategy?
Why do such problems arise in the first place?

What challenges does the process of applying

software patches and updates pose for many
businesses?
What are the limitations of the patching process?

13-80

Case Study Questions

Does the business value of a comprehensive
patch-management strategy outweigh its costs,
its limitations, and the demands it placed on the
IT function?

13-81