Security, Risk Management and Control in Electronic Commerce (Case Study Sample)

Security, Risk Management, and Control in Electronic Commerce
Part A: Short Answer- this part consists of 4 questions. Each question is worth 5 marks. You must attempt all 4 questions for a total of 20 marks.
1. (5 points) Risk Strategies
Analyze each of the following situations in terms of risk exposures. Identify and explain the risk management approaches that would be the most appropriate (cost effective) for each situation.
SituationSelected approach and justification of the choiceA space shuttle, when entering earth’s atmosphere caught fire. The black box, which logs all states of the shuttle, flew off and presumably landed somewhere on earth.At a university, the new student course registration system ran into implementation delays by two weeks. It was rolled out on the first day of registration for the next semester. Until noon that day, the system was down. Those students with first priority could not register on time.Microsoft informed company X that based on its calculation, it estimates company X should have more software licenses that Microsoft customer record shows.A subcontractor who worked in the company IS department had access to sensitive files. On his last day, he emailed the company’s customer to himself.
2. (5 points) Chinese wall policy
Suppose you work for a company with a Chinese wall security policy with clients in the following conflict classes:
{Cadbury, Nestle}
{Ford, Chrysler, GM}
{Citicorp, Credit Lyonnais, Deutsche Bank}
{Microsoft}
Assume that Ted, an analyst of the company, has previously worked on cases for Nestle and Citicorp, and he is waiting for a new assignment.
Question 1
As the security officer of the company, list any of the company’s clients for whom Ted will not be able to work as his next assignment. You can assume that Ted can work for a client for whom he has previously worked.
Question 2
Assume that two of your colleagues Ali and Sally are currently working on the following cases:
Ali is working on Nestle, GM, and Citicorp.
Sally is working on Nestle, GM, and Credit Lyonnais
Your job is to determine the read/write/execute rights of Ali and Sally on the different objects.
3.(5 points) Security Models
The Graph below represents the security levels of the staff in large organization.
The arrows represent a specific operation.
By examining the graph below, can you determine which security model applies given that:
a) The operation represented by the arrow is a write statement? Justify your answer
b) The operation represented by the arrow is a read statement? Justify your answer


4. (5 points) Contingency Planning
You are the Chief Information Security Officer of an E-commerce Company. You have received notification from your network security administrator of a worm attack. The message says:
The anti-malware software had detected a worm attack. The incident response team tried to stop the worm unsuccessfully.
The worm has spread through a software vulnerability in database management system software you are running on twenty computers on the network.
When the attack is discovered, the worm has infected three database servers, including a mission critical server that is not redundant.
Your network security administrator has launched the disaster recovery plan. Since he is a new hire, you want to make sure that:
He follows just the required steps of the plan
he follows them in the proper order
Your task will be to identify the steps he should take and to rank them by the order in which he should take them.
You will do so by:
Placing a number next to each step.
placing an X next to the actions you should not perform.
Since you are mentoring this new manager, you will also justify the choice of the required steps as well as the way you ranked them.
Action Should be performed (yes/no)Ranking if it should be performedShut down all infected systems.Notify management.Remove all infected systems from the network.Visit the vendor's website to locate a security update.Reformat all infected systems.Replace all infected systems with spares. Part B: Problem. This part consists of 4 problems. Each problem is worth 12.5 marks. You must attempt all 4 problems for a total of 50 marks.
1. (13 points) Qualitative risk analysis
Consider an e-commerce Web site that normally runs seven days a week, 24 hours a day, generating an average of $2,000 per hour in revenue from customer orders.
Experience has shown that the site becomes unavailable due to operating systems failure three times a week.
at each operating system failure, the site is unavailable for 2 hours.
in addition, the company estimates that upon a failure, it would spend $10,000 on advertising to counteract the negative publicity from such an incident.
and upgrade of the operating system will eliminate the threat, but it will cost the company 1000,000 dollars a year.
The company has also a farm of backup servers for its data mining activity.
This farm of servers is valued at 1,500,000 dollars.
It is estimated that a fire will result in damages worth 85 % to this asset.
 Inspectors from the Fire Department have estimated that a fire can occur once every two years in the present situation.
You received a proposition of a fire prevention system that would reduce likelihood of a fire to once every 5 years with damages of only 15% of the asset. The fire prevention system costs 1,750,000 dollars
The same e-commerce server faces the threats of programming mistakes. In the past, experience has shown that programmer’s mistakes occur about ten times a month, and that each mistake leads to the web site unavailability for half an hour. You have leanrt about a training program for your programmers that would cut by 90% the occurrence of programming errors by your programmers.
This program costs $ 4000,000
As the Information Security Officer, you are to conduct a risk analysis to determine whether to accept or reject the solutions offered. Base your decision on a cost/benefit analysis.
2. (13 points) Digital Signature
Comparing Digital signature (DS) and Message authentication codes (MAC).
Assume that Oscar is able to observe all messages sent from Bob to Alice and vice versa.
Oscar has no knowledge of any keys except the public ones in case DS is used.
State whether and how (i) DS and (ii) MAc protect against each type of attack. The value of Auth(x) is computed with DS or a MAC algorithm respectively.
You can assume that When Alice signs a message, she uses her private key.
You can also assume that when a MAC algorithm is used, the MAC algorithm uses a secret (symmetric) key known to both parties included in the communication. You can assume that:
Alice and Bob use a key Kab when they use the MAC algorithm.
Alice and Oscar use a key Kao when they use the MAC algorithm.
ScenariosResult of the scenario if a digital signature is used for the Authentication(X)Result of the scenario if a Message Authentication Code MAC is used for the Authentication(X)Message Integrity: Alice sends a message X=” Transfer 1000 dhs to Mark” in the clear, and also sends Auth(X) to BOB.
Oscar intercepts the message, and replaces “Mark” with “Oscar”. Can Bob detect this?Replay: Alice sends a message X=” Transfer 1000 dhs to Oscar” in the clear, and also sends Auth(X) to BOB. Oscar observes the message and signature and sends the message 100 times to Bob. Will Bob detect this?Sender Authentication with cheating third party:
Oscar claims that he sent some message X with a valid Auth(X) to Bob but Alice claims the same. Can Bob clear the question with either case?Authentication with Bob Cheating: Bob claims that he received a message X with a valid signature Auth(X) from Alice ( e.g., “Transfer 1000 dh from Alice to Bob”) but Alice claims she never sent it. Can Alice clear this question in either case?
3. (13 points) Firewalls
SMTP ( Simple mail transfer protocol) is the standard protocol for transferring mail between hosts over TCP. A TCP connection is set up between a user agent and a server program. The server listens on TCP port 25 for incoming connection requests. The user end of the connection in on TCP port number above 1023. Suppose you wish to build packet filter rule set allowing inbound and outbound SMTP traffic. You generate the following rule set:
Rule directionSrc addrDest addrProtocol Dest portActionAInExternalInternal TCP25PermitBOut Internal ExternalTCP> 1023PermitCOutInternal ExternalTCP25PermitDInExternalInternal TCP>1023PermitEEitherAnyAny AnyAnyDeny
1. Describe the effect of each rule
2. Your host has IP address 172.16.1.1. Someone tries to send e-mail from a remote host with IP address 192.168.3.4. If successful, this generates an SMTP dialogue between the remote user and the SMTP server on your host consisting of SMPT commands and mail. Additionally, assume that a user on your host tries to send e-mail to the SMTP server on the remote system.
3. Four packets are shown in the table below. For each packet indicate which packets are permitted, which are denied, and which rules were used.
Packet Direction Src addrDest AddrProtocolDest portAction 1In192.168.3.4172.16.1.1TCP25?2Out 172.16.1.1192.168.3.4TCP1234?3Out 172.16.1.1192.168.3.4TCP25?4In192.168.3.4172.16.1.1TCP1357?
4. Someone from the outside world( 10.1.2.3) attemp...