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The Password is …

Merchants need new authentication tactics to protect themselves from an epidemic of data breaches

April 2014 By Andreas Baumhof
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The problem is magnified by the fact that users tend to have the same password for many different accounts. Multiple studies show that upwards of 50 percent of individuals use the same password for all or most of their login accounts, including work, online merchant accounts, banking applications and social networking sites. This is dangerous for a number of reasons. Crime rings, for example, use social networking and other sites with relatively weak security to crack passwords. Sites without velocity checks to detect automated scripts or botnets are repeatedly exploited until valid credentials are discovered. Once passwords are ascertained on these weaker sites, the credentials can be used to gain access to numerous other sites.

Armed with cracked, guessed or stolen login credentials, cybercriminals enter the front door so to speak. Using normal login procedures, hackers directly access user and even privileged system accounts to register fake accounts, make fraudulent purchases, steal credit or debit card data, download intellectual property and disrupt information systems.

Context-Based Authentication
The vast majority of authentication systems break because of one reason: they focus entirely on evaluating login credentials, usually passwords, and completely fail to detect or even look for imposters who have stolen but valid credentials.

It's clear that a new approach is needed — one that adds authentication layers to increase trust when necessary, but doesn't impact the experience of legitimate users. And, most importantly, the solution needs to look at the entire picture, not just login credentials.

Fortunately, with the advent of context-based authentication, the entire set of circumstances that surround a login attempt can be evaluated. There are numerous indicators and techniques now available that detect with a high degree of accuracy when an imposter is attempting to gain access, even if he or she has valid credentials. Imposters are challenged and denied access, and legitimate users are allowed to connect without friction.

Merchants can protect themselves from cybercriminals by implementing context-based authentication, which provides a number of advanced capabilities and benefits, including the following:

  • Sophisticated processes profile the user's device to identify the specific PC, laptop, tablet or phone, and to detect the presence of malware or other threats. IP address, geolocation, language or other configuration mismatches, cookies, and numerous additional risk factors are evaluated.
  • Shared global trust intelligence networks to examine a user's identity and activity, recognizing both legitimate users and threats based on anonymous shared intelligence. Multiple contextual elements all work together to establish trusted and untrusted attempts by users to log in, including device health, history and associations with fraud, user persona and behavior, and trust associations.
  • A trust-based approach that's capable of "tagging" identifying elements such as the combination of a specific user and device with levels of trust or untrust. This provides you with advanced security features and a frictionless experience for legitimate users. 
  • Elevate trust when necessary by implementing two-factor or out-of-band authentication.

In light of the countless recent high-profile data breaches — and more certain to come — businesses must be more cautious than ever and implement effective authentication procedures that do more than just evaluate login credentials. The entire context surrounding each login attempt must be analyzed to detect and stop imposters, even if they have valid credentials.

Andreas Baumhof is the chief technology officer at ThreatMetrix, a provider of integrated cybercrime prevention solutions. Andreas can be reached at abaumhof@threatmetrix.com


 

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