'Heartbleed' cybersecurity threat looms over advisers and clients

Steps, including changing passwords, multi-factor verification, can be taken to lessen threat

Apr 9, 2014 @ 1:04 pm

By Joyce Hanson

Advisers and financial services firms are scrambling this week to avert any potential damage from the “Heartbleed” cybersecurity bug that has recently come to light and threatens millions of web users.

Encrypted channels for online communication that were thought to be secure have now been identified as being at risk due to a flaw in a piece of code in the OpenSSL — an open-source cryptographic library — said Arthur Bierer, chief technology officer at online lead-generation startup Vestorly Inc.

The compromised code is shared by many programs and can be found in many different products, which makes the threat so widespread, said Mr. Bierer, who previously worked on the engineering team at Microsoft and helped implement SSL on Internet Explorer.

“What's happening is that the private keys to the castle can be gotten hold of using this security flaw,” he said. “It allows a hacker to eavesdrop on the communication between clients, the adviser and their financial institutions."

“This is a really bad one,” Mr. Bierer said of the Heartbleed bug.

Mr. Bierer recommended that advisers and clients immediately change their banking passwords and then follow good Internet security guidelines: Passwords should be changed every 90 days, should not be shared and shouldn't be re-used for different websites.

Bill Winterberg, founder of FPPad, a technology consulting firm for financial advisers, agreed with the potential dangers of Heartbleed.

Calling it “bad news,” Mr. Winterberg said anyone who uses Internet services has potential vulnerability to the bug.

He recommended advisers and clients go to the filippo.io Heartbleed test and use the online tool to enter the domain name of any web service used, to identify whether the site is subject to attack.

“Fortunately, more and more providers are securing their services and actively fixing this,” Mr. Winterberg said. “Still, the advice I'm giving my clients is to assume you're affected. Run the filippo.io test, and if the test says there's no more vulnerability, it's fixed. Then change your password.”

He also urged advisers and clients to use multi-factor web verification whenever possible.

Custodians and other financial services firms are testing their platforms to see if they're vulnerable to the Heartbleed bug.

TD Ameritrade Institutional, for example, released a statement saying that TDAI is monitoring the situation and working with business partners to validate that they are secure as well.

“TD Ameritrade's websites and mobile applications do not utilize versions of OpenSSL that are susceptible to the recently announced Heartbleed vulnerability,” the custodian said in its statement.

Roel Schouwenberg, principal security researcher at IT security vendor Kaspersky Lab, warned that any service that has run or is running the vulnerable OpenSSL code suffers a risk of information disclosure.

“The vulnerable code has been out there for two years already, and exploitation of the vulnerability doesn't leave any traces in the logs on the server, making it hard to determine if exploitation ever occurred,” he wrote in an e-mail.

“An attacker could possibly get access to personal identifiable information, user names, passwords, Social Security numbers, financial records and even the cryptographic keys that are responsible for encrypting the network traffic between client and server,” Mr. Schouwenberg said.

0
Comments

What do you think?

View comments

Recommended for you

Upcoming Event

Apr 30

Conference

Retirement Income Summit

Join InvestmentNews at the 12th annual Retirement Income Summit - the industry's premier retirement planning conference.Much has changed - and much remains to be learned. Attend and discuss how the future is full of opportunity for ... Learn more

Featured video

Events

Identifying unconventional risk and finding a secret weapon in client portfolios

Advisers are hungry to find new alternative investment opportunities. But Rupal Bhansali of Ariel Investments says the secret weapon could be right under your nose - in cash.

Latest news & opinion

Meet our 2017 Women to Watch

Introducing 20 female financial advisers and industry executives who are distinguished leaders, advancing the business of providing advice through their creativity and hard work.

Raymond James executives call on industry to keep broker protocol

Also ask firms to pay for the administration of the protocol to 'ensure its longevity and relevance.'

Senate committee approves tax plan but full passage not assured

Several Republican senators expressed reservations about the bill, and the GOP cannot afford too many defections.

House passes tax bill, focus turns to Senate

Tax reform legislation expected to have more of a challenge in upper chamber.

SEC enforcement of advisers drops in Trump era

The agency pursued 82 cases against advisers and firms in fiscal year 2017, down from 98 the previous year.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print