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posted by martyb on Monday August 20 2018, @04:36PM   Printer-friendly
from the something-only-YOU-have-know-are dept.

Submitted via IRC for Fnord666

If hackers can convince your phone company to turn over your number to them, they can defeat two-factor authentication that relies on text messaging.

Crypto investor Michael Terpin filed a $224 million lawsuit against AT&T in California federal court Wednesday alleging that the phone company’s negligence let hackers steal nearly $24 million in cryptocurrency from him, Reuters reports. He’s also seeking punitive damages.

Terpin says hackers were twice able to convince AT&T to connect his phone number to a SIM card they controlled, routing his calls and messages to them and enabling them to defeat two-factor authentication protections on his accounts. In one case, he says hackers also took control of his Skype account and convinced one of this clients to send money to them rather than Terpin.

The second hack came even after AT&T agreed to put an additional passcode on his account, when a fraudster visited an AT&T store in Connecticut and managed to hijack Terpin’s account without providing the code or a “scannable ID” as AT&T requires, he says.

Source: https://www.fastcompany.com/90219499/att-gets-sued-over-two-factor-security-flaws-and-23m-cryptocurrency-theft


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  • (Score: 2) by sjames on Tuesday August 21 2018, @06:22PM (2 children)

    by sjames (2882) on Tuesday August 21 2018, @06:22PM (#724292) Journal

    In the case at hand, as pre-arranged with the customer, knowledge of a password was the criterion. Had the AT&T employee actually asked for the password as AT&T and the customer agreed, this wouldn't have happened.

    An alternative that might be offered if agreed with the customer is that a letter is sent to the billing address containing a password that will then be accepted for changing the service. That way when the customer fails to keep track of the password, there remains a way to make a needed change.

    It isn't perfect security, but it would make any shenanigans much more hands-on and add a clear felony for tampering with U.S. mail.

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  • (Score: 2) by Knowledge Troll on Tuesday August 21 2018, @06:45PM (1 child)

    by Knowledge Troll (5948) on Tuesday August 21 2018, @06:45PM (#724309) Homepage Journal

    Had the AT&T employee actually asked for the password as AT&T and the customer agreed, this wouldn't have happened.

    Considering part of the claim is that someone went down to the location in person yet AT&T didn't use a "scanable" ID is part of the claim and we are talking $20 million here I don't think that password was going to stand in the way.

    Of all the things to fault I suggest that showing up in person and not checking the ID is the biggest fuck up because someone can always go "well I forgot my password" and the CS agents are going to be happy to help them get access again. In cases like this the physical presence with physical ID is a requirement and AT&T, if we take the plantif's word for it, did not follow their own policy for the ID.

    I suggest though that even that ID check is not obvious on how to handle it and it is not going to tolerate very good forgeries very well.

    The idea of having a password sent in the mail is pretty good. Though for $20 million I bet it is easy to afford paying someone to steal the mail for 5 days in a row.

    • (Score: 2) by sjames on Tuesday August 21 2018, @07:13PM

      by sjames (2882) on Tuesday August 21 2018, @07:13PM (#724316) Journal

      Actually, if the lack of the password had prevented intercepting the 2FA, it absolutely would have foiled the theft. It was an integral party of the theft.

      It was explicitly agreed to by AT&T and then they didn't do it. As a direct result, the phone was hijacked and the 2FA was defeated.

      And I already suggested a mechanism for password recovery for the likely case that someone forgets their password. It would actually be harder to scam than creating a fake ID good enough to fool a poorly paid representative in a store.