MANAGEMENT INFORMATION SYSTEMS

MODULE I: MANAGEMENT INFORMATION SYSTEMS

CHAPTER VIII: SECURING INFORMATION SYSTEMS

I. OBJECTIVES
At the end of this chapter, the students should be able to answer the following questions:
 Why are information systems vulnerable to destruction, error, and abuse?
 What is the business value of security and control?
 What are the components of an organizational framework for security and control?
 What are the most important tools and technologies for safeguarding information
resources?

II. SUBJECT MATTER

Topic: Securing Information Systems
Sub topic: - System Vulnerability and Abuse
- Business Value and Security control
- Establishing a Framework for Security and Control
- Technologies and Tools for Protecting Information Resources

III. PROCEDURE
A. Preliminaries
Pre- Assessment
1. Define and discuss Security and Control.
2. Explain why systems are vulnerable and enumerate the contemporary security
challenges and vulnerabilities.
3. Illustrate how a framework for security and control are established.
4. Discuss how the different tools and technologies for protecting information resources.

B. Lesson Proper
If you used the computer to run your business, you might not be able to sell to your customers or
place orders with your suppliers while it was down. And you might find that your computer
system had been penetrated by outsiders, who perhaps stole or destroyed valuable data,
including confidential payment data from your customers. If too much data were destroyed or
divulged, your business might never be able to operate! In short, if you operate a business today,
you need to make security and control a top priority.
 1. System Vulnerability and Abuse

Security:
Policies, procedures and technical measures used to prevent unauthorized access, alteration,
theft, or physical damage to information systems.

Controls:
Methods, policies, and organizational procedures that ensure safety of organization’s assets;
accuracy and reliability of its accounting records; and operational adherence to management
standards.

Why systems are vulnerable

 Accessibility of networks
 Hardware problems (breakdowns, configuration errors, damage from improper use or
crime)
 Software problems (programming errors, installation errors, unauthorized changes)
 Disasters
 Use of networks/computers outside of firm’s control
 Loss and theft of portable devices

CONTEMPORARY SECURITY CHALLENGES AND VULNERABILITIES

The architecture of a Web-based application typically includes a Web client, a server, and
corporate information systems linked to databases. Each of these components presents security
challenges and vulnerabilities. Floods, fires, power failures, and other electrical problems can
cause disruptions at any point in the network.

Internet vulnerabilities

 Network open to anyone

  Size of Internet means abuses can have wide impact
 Use of fixed Internet addresses with cable or DSL modems creates fixed targets hackers
 Unencrypted VOIP
 E-mail, P2P, IM
o Interception
o Attachments with malicious software
o Transmitting trade secrets

Wireless security challenges

 Radio frequency bands easy to scan

 SSIDs (service set identifiers)
o Identify access points
o Broadcast multiple times
o War driving: Eavesdroppers drive by buildings and try to detect SSID and gain
access to network and resources
 WEP (Wired Equivalent Privacy)
o Security standard for 802.11; use is optional
o Uses shared password for both users and access point
o Users often fail to implement WEP or stronger systems

System Vulnerability and Abuse

Many Wi-Fi networks can be penetrated easily by intruders using sniffer programs to obtain an
address to access the resources of a network without authorization.
Malware (malicious software)

 Viruses: Rogue software program that attaches itself to other software programs or data
files in order to be executed
 Worms: Independent computer programs that copy themselves from one computer to
other computers over a network.
 Trojan horses: Software program that appears to be benign but then does something
other than expected.
 SQL injection attacks: Hackers submit data to Web forms that exploits site’s unprotected
software and sends rogue SQL query to database.
 Spyware: Small programs install themselves surreptitiously on computers to monitor user
Web surfing activity and serve up advertising.
 Key loggers: Record every keystroke on computer to steal serial numbers, passwords,
launch Internet attacks.

Hackers and computer crime

 Hackers vs. crackers

 Activities include
o System intrusion
o System damage
o Cybervandalism
o Intentional disruption, defacement, destruction of Web site or corporate
information system

Spoofing

 Misrepresenting oneself by using fake e-mail addresses or masquerading as someone else

 Redirecting Web link to address different from intended one, with site masquerading as
intended destination

Sniffer

 Eavesdropping program that monitors information traveling over network

 Enables hackers to steal proprietary information such as e-mail, company files, etc.

Denial-of-service attacks (DoS)

 Flooding server with thousands of false requests to crash the network.

Distributed denial-of-service attacks (DDoS)

 Use of numerous computers to launch a DoS

 Botnets
 o Networks of “zombie” PCs infiltrated by bot malware
o Worldwide, 6 - 24 million computers serve as zombie PCs in thousands of botnets

Computer crime

 Defined as “any violations of criminal law that involve a knowledge of computer

technology for their perpetration, investigation, or prosecution”
 Computer may be target of crime, e.g.:
o Breaching confidentiality of protected computerized data
o Accessing a computer system without authority
 Computer may be instrument of crime, e.g.:
o Theft of trade secrets
o Using e-mail for threats or harassment

Identity theft: Theft of personal Information (social security id, driver’s license or credit card
numbers) to impersonate someone else.

Phishing: Setting up fake Web sites or sending e-mail messages that look like legitimate
businesses to ask users for confidential personal data.

Evil twins: Wireless networks that pretend to offer trustworthy Wi-Fi connections to the Internet.

Pharming: Redirects users to a bogus Web page, even when individual types correct Web page
address into his or her browser.

Click fraud: Occurs when individual or computer program fraudulently clicks on online ad without
any intention of learning more about the advertiser or making a purchase.

Cyberterrorism and Cyberwarfare

Software vulnerability

 Commercial software contains flaws that create security vulnerabilities

o Hidden bugs (program code defects): Zero defects cannot be achieved because
complete testing is not possible with large programs
 Flaws can open networks to intruders
 Patches
o Vendors release small pieces of software to repair flaws
o However exploits often created faster than patches be released and implemented
 2. Business Value of Security and Control

 Failed computer systems can lead to significant or total loss of business function
 Firms now more vulnerable than ever
o Confidential personal and financial data
o Trade secrets, new products, strategies
 A security breach may cut into firm’s market value almost immediately
 Inadequate security and controls also bring forth issues of liability
 Legal and regulatory requirements for electronic records management and privacy
protection
HIPAA: Medical security and privacy rules and procedures.
Gramm-Leach-Bliley Act: Requires financial institutions to ensure the security and confidentiality
of customer data.
Sarbanes-Oxley Act: Imposes responsibility on companies and their management to safeguard
the accuracy and integrity of financial information that is used internally and released externally.
Electronic evidence
 Evidence for white collar crimes often in digital form
 Data on computers, e-mail, instant messages, e-commerce transactions
 Proper control of data can save time and money when responding to legal discovery
request
Computer forensics:
 Scientific collection, examination, authentication, preservation, and analysis of data from
computer storage media for use as evidence in court of law
 Includes recovery of ambient and hidden data
Information systems controls
 Manual and automated controls
 General and application controls
General controls
 Govern design, security, and use of computer programs and security of data files in
general throughout organization’s information technology infrastructure.
 Apply to all computerized applications
 Combination of hardware, software, and manual procedures to create overall control
environment.
 3. Establishing a Framework for Security and Control
Types of general controls
 Software controls
 Hardware controls
 Computer operations controls
 Data security controls
 Implementation controls
 Administrative controls
Application controls
 Specific controls unique to each computerized application, such as payroll or order
processing
 Include both automated and manual procedures
 Ensure that only authorized data are completely and accurately processed by that
application
 Include:
o Input controls
o Processing controls
o Output controls

Risk assessment: Determines level of risk to firm if specific activity or process is not properly
controlled
Types of threat
 Probability of occurrence during year
 Potential losses, value of threat
 Expected annual loss
Security policy
 Ranks information risks, identifies acceptable security goals, and identifies mechanisms
for achieving these goals
 Drives other policies
o Acceptable use policy (AUP): Defines acceptable uses of firm’s information
resources and computing equipment
o Authorization policies: Determine differing levels of user access to information
assets.
Identity management
 Business processes and tools to identify valid users of system and control access
o Identifies and authorizes different categories of users
o Specifies which portion of system users can access
 o Authenticating users and protects identities
 Identity management systems
o Captures access rules for different levels of users

SECURITY PROFILES FOR A PERSONNEL SYSTEM



These two examples represent two security profiles or data security patterns that might be found
in a personnel system. Depending on the security profile, a user would have certain restrictions
on access to various systems, locations, or data in an organization.
4. Establishing a Framework for Security and Control
 Disaster recovery planning: Devises plans for restoration of disrupted services
 Business continuity planning: Focuses on restoring business operations after disaster
o Both types of plans needed to identify firm’s most critical systems
o Business impact analysis to determine impact of an outage
o Management must determine which systems restored first

MIS audit
 Examines firm’s overall security environment as well as controls governing individual
information systems
 Reviews technologies, procedures, documentation, training, and personnel.
 May even simulate disaster to test response of technology, IS staff, other employees.
 Lists and ranks all control weaknesses and estimates probability of their occurrence.
  Assesses financial and organizational impact of each threat
SAMPLE AUDITOR’S LIST OF CONTROL WEAKNESSES

This chart is a sample page from a list of control weaknesses that an auditor might find in a loan
system in a local commercial bank. This form helps auditors record and evaluate control
weaknesses and shows the results of discussing those weaknesses with management, as well as
any corrective actions taken by management.
Technologies and Tools for Protecting Information Resources
Identity management software
 Automates keeping track of all users and privileges
 Authenticates users, protecting identities, controlling access
Authentication
 Password systems
 Tokens
 Smart cards
 Biometric authentication
Firewall:
 Combination of hardware and software that prevents unauthorized users from accessing
private networks
  Technologies include:
o Static packet filtering
o Network address translation (NAT)
o Application proxy filtering

A CORPORATE FIREWALL

The firewall is placed between the firm’s private network and the public Internet or another
distrusted network to protect against unauthorized traffic.
Intrusion detection systems:
 Monitor hot spots on corporate networks to detect and deter intruders
 Examines events as they are happening to discover attacks in progress
Antivirus and antispyware software:
 Checks computers for presence of malware and can often eliminate it as well
 Require continual updating
Unified threat management (UTM) systems
Securing wireless networks
 WEP security can provide some security by
o Assigning unique name to network’s SSID and not broadcasting SSID
o Using it with VPN technology
 Wi-Fi Alliance finalized WAP2 specification, replacing WEP with stronger standards
o Continually changing keys
o Encrypted authentication system with central server
Encryption:
 Transforming text or data into cipher text that cannot be read by unintended recipients
 Two methods for encryption on networks
o Secure Sockets Layer (SSL) and successor Transport Layer Security (TLS)
o Secure Hypertext Transfer Protocol (S-HTTP)

Two methods of encryption

Symmetric key encryption: Sender and receiver use single, shared key
Public key encryption
 Uses two, mathematically related keys: Public key and private key
 Sender encrypts message with recipient’s public key
 Recipient decrypts with private key
PUBLIC KEY ENCRYPTION

A public key encryption system can be viewed as a series of public and private keys that lock data
when they are transmitted and unlock the data when they are received. The sender locates the
recipient’s public key in a directory and uses it to encrypt a message. The message is sent in
encrypted form over the Internet or a private network. When the encrypted message arrives, the
recipient uses his or her private key to decrypt the data and read the message.
Digital certificate:
 Data file used to establish the identity of users and electronic assets for protection of
online transactions
 Uses a trusted third party, certification authority (CA), to validate a user’s identity
 CA verifies user’s identity, stores information in CA server, which generates encrypted
digital certificate containing owner ID information and copy of owner’s public key
Public key infrastructure (PKI)
 Use of public key cryptography working with certificate authority
 Widely used in e-commerce
DIGITAL CERTIFICATES

Digital certificates help establish the identity of people or electronic assets. They protect online
transactions by providing secure, encrypted, online communication.
Ensuring system availability: Online transaction processing requires 100% availability, no
downtime
Fault-tolerant computer systems
 For continuous availability, e.g. stock markets
 Contain redundant hardware, software, and power supply components that create an
environment that provides continuous, uninterrupted service
High-availability computing
 Helps recover quickly from crash
 Minimizes, does not eliminate downtime
Recovery-oriented computing
 Designing systems that recover quickly with capabilities to help operators pinpoint and
correct of faults in multi-component systems
Controlling network traffic
 Deep packet inspection (DPI)
 Video and music blocking

Security outsourcing: Managed security service providers (MSSPs)

Security in the cloud
 Responsibility for security resides with company owning the data
 Firms must ensure providers provides adequate protection
 Service level agreements (SLAs)
Securing mobile platforms
 Security policies should include and cover any special requirements for mobile devices
 E.g. updating smart phones with latest security patches, etc.
Ensuring software quality
 Software metrics: Objective assessments of system in form of quantified measurements
o Number of transactions
o Online response time
o Payroll checks printed per hour
o Known bugs per hundred lines of code
 Early and regular testing
 Walkthrough: Review of specification or design document by small group of qualified
people
 Debugging: Process by which errors are eliminated

ACTIVITY 1: TRUE OR FALSE

Write T if the statement is True and write F if the statement is False. Write your answers on the
spaces provided below.
_____1. War driving occurs when eavesdroppers drive by or park outside buildings and try to
intercept wireless network traffic.
_____2. A computer virus is a rogue software that attaches itself to other software programs or
data files without user knowledge or permission.
_____3. Canadian Sarbanes-Oxley Act (CSOX) and Personal Information Protection and Electronic
Documents Act (PIPEDA) are guidelines that Canadian companies may follow to improve security
and control.
_____4. The CSOX imposes responsibility on companies and their management to safeguard the
accuracy and integrity of information that is used internally and released externally.
____5. Computer forensics is the scientific collection, examination, authentication, preservation,
and analysis of data held on or retrieved from computer storage media in such a way that the
information can be used as evidence in a court of law.
____6. The acceptable use policy defines acceptable use of the firm's information; however, the
acceptable use of hardware and software resources is covered under federal laws.
____7. When developing a security policy, management must estimate how much it will cost to
achieve the level of acceptable risk.
____8. Biometric authentication is a totally reliable method of authentication.
____9. Network Address Translation (NAT) conceals the IP (Internet protocol) addresses of the
organization's internal host computer(s) to prevent sniffer programs outside the firewall from
getting them.
____10. Most antivirus software is effective against all types of viruses and, once installed, will
remain effective for years.

ACTIVITY 2: ESSAY WRITING

Answer each questions and / or statements briefly. Write on the spaces provided below.
1. Why are information systems vulnerable to destruction, error, and abuse?
________________________________________________________________________
________________________________________________________________________
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What is system software? What

kinds of programs are included
in system
software?
What is system software? What
kinds of programs are included
in system
software?
2. What is the business value of security and control?
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________

3. What are the components of an organizational framework for security and control?
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________

4. What are the most important tools and technologies for safeguarding information
resources?
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
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