Posts Tagged ‘compliance

18
Feb
15

Council Surveys QSAs On SSL

This message popped into my inbox late yesterday.

20150217-PCISSCemailMsg

The survey in question contains the following questions.

20150217-PCISSCSurvey

All of my clients have gotten rid of SSL on their public facing Web sites.

The dilemma we have is that while SSL is dead, it is baked into so many products and appliances.  My clients are therefore stuck with appliances and software products that have SSL hard coded into them.  As a result, they will be dependent on their vendors to convert to TLS.

That said, what is the risk of using SSL internally?  Not a good practice, but truthfully, what is the risk?

In my opinion, using SSL internally for the next 12 to 24 months would not be the end of the world as long as it does not become a significant attack vector.

It will be interesting to hear the results of this survey.

15
Feb
15

New PCI Compliance Study

Dr. Branden Williams and the Merchants Acquirer Committee (MAC) have issued a new report on PCI compliance and the impact of breaches on merchants and MAC members.  I had the pleasure of getting a preview of the survey results from Dr. Williams a few weeks before its publication.  Based on some of the online chatter I have seen, the study is being both applauded and chastised for its results.

First, who is the MAC?

“The MAC community includes acquirers/merchant banks, processors, independent sales organizations (ISOs), and others. MAC membership exceeds 500 firms.”

What was the response rate for the study?

“Approximately 20% of MAC members participated in the survey (although not all survey responses could be used in the analysis due to incomplete responses).”

While 20% might seem an awful low response rate for a survey, for those of us that conduct surveys, 20% is actually quite good.

One set of facts that was missing in the survey that I felt was important was how many merchants do the 100+ survey respondents cover and what is their breakdown by merchant level?  Branden very kindly ran a query and sent me back the following.

Level 1 Merchants:                  73

Level 2 Merchants:                153

Level 3 Merchants:             3,832

Level 4 Merchants:      1,140,623

Total:                              1,144,681

Based on this information, I would say that it reasonably represents the breakdown of merchant levels out in the real world.

The biggest finding of the study and what most people are pointing to is the low compliance percentages across the MAC members’ merchants.  Level 1, 2 and 3 merchants are only compliant around 67% to 69% of the time during their assessments.  However, most troubling is that Level 4 merchants are only 39% compliant.

Depending on the merchant level, these figures are not even close to what Visa last reported back in 2011.  Back then, Visa was stating that 98% of Level 1 merchants were reported as compliant.  Level 2 merchants were reported to be at 91% compliance.  Level 3 merchants were reported at 57% compliance.  As is Visa’s practice, it only reported that Level 4 merchants were at a “moderate” level of compliance.

So how do we square the difference in compliance percentages between the MAC and Visa numbers?  We do not because the numbers are like comparing apples to oranges.

The purpose of the study was to examine breaches and their impact on merchants.  As such, the study’s numbers indicate not only PCI compliance but also the number of organizations breached that were deemed PCI compliant, hence the much lower PCI compliance rates.

Visa’s numbers are based on filings of PCI Attestation Of Compliance (AOC) forms with processors and acquiring banks who then report those statistics up to Visa.  Visa, or any card brand for that matter, has never shared the complete equation of the number of merchants that were breached but filed an AOC indicating they were PCI compliant.  As a result, the figures posted by Visa are not representative of the study’s results and vice versa.

I think this study provides a much better look into PCI compliance than we have had from the card brands.  It shows that merchants have a significant amount of work to do maintaining PCI compliance.  I would highly recommend you download a copy of the report and share it with your management.

31
Jan
15

Merchant, Service Provider Or Both?

Apparently there are a lot of newcomers to the PCI compliance business and are asking bizarre questions regarding PCI.  One of the most common is if their organization is a merchant or a service provider or both?

Merchant

According to the PCI DSS v3 Glossary, a merchant is defined as:

“For the purposes of the PCI DSS, a merchant is defined as any entity that accepts payment cards bearing the logos of any of the five members of PCI SSC (American Express, Discover, JCB, MasterCard or Visa) as payment for goods and/or services. Note that a merchant that accepts payment cards as payment for goods and/or services can also be a service provider, if the services sold result in storing, processing, or transmitting cardholder data on behalf of other merchants or service providers. For example, an ISP is a merchant that accepts payment cards for monthly billing, but also is a service provider if it hosts merchants as customers.”

One of the points that create some of the most confusion is the point made at the end of the merchant definition that it is possible for a merchant to also be a service provider.  A lot of people think that this is a black or white, either or type of situation which it is not.

The key thing to determining if your organization is a merchant is if your organization signed a merchant agreement with a bank and has a merchant account with that bank.  If your organization did, then you are definitely a merchant.

Service Provider

Now let us talk about service providers.  In the same document, a service provider is defined as:

“Business entity that is not a payment brand, directly involved in the processing, storage, or transmission of cardholder data on behalf of another entity. This also includes companies that provide services that control or could impact the security of cardholder data. Examples include managed service providers that provide managed firewalls, IDS and other services as well as hosting providers and other entities. If an entity provides a service that involves only the provision of public network access—such as a telecommunications company providing just the communication link—the entity would not be considered a service provider for that service (although they may be considered a service provider for other services).”

The first thing to remember about service providers is that you can be tagged as a service provider and not be directly processing, storing or transmitting cardholder data (CHD) or sensitive authentication data (SAD).  We see this most often with organizations that provide managed security services (MSS).  In most cases, these organizations manage/monitor the devices that provide and/or secure the communications links.  As a result, these MSS providers can have access to unencrypted CHD/SAD whether they realize that or not.  If the MSS could be in contact with unencrypted CHD/SAD via the devices they manage, then they are in-scope for PCI compliance.

I can tell you from personal experience that service providers that are not directly processing, storing or transmitting CHD/SAD will push back and fight very hard to be ruled out of scope for PCI compliance.  It has gotten to the point that I have seen and heard of service providers taking customers to court for misrepresenting their business and to force their customer out of their service contract.  In the majority of the cases I am aware; it was shown that it was the service providers’ negligence from not explicitly asking whether or not PCI compliance was required by the customer.  So if you need to be PCI compliant, it is very important to make that clear to any service provider you are looking at just in case one or more of their services could come into contact with CHD/SAD.

Another way an organization can become a service provider is when they conduct card transactions on behalf of a third party.  The best example of this situation is with outsourced call centers.  While the call center might be conducting the card transactions on your systems, they are a third party that is processing and transmitting CHD/SAD through their workstations for your organization.  As a result, the call center is a service provider and is in-scope for PCI compliance.

Another way an organization can become a third party is if they are conducting transactions through their systems using a merchant account of a third party.  I have encountered this with call centers where the call center is using their own applications, but the merchant account used to process payments through is not the call center’s merchant account, it is the merchant account of the call center’s customer.

Both?

Finally, there is the example from the Merchant definition where the organization is both a merchant and a service provider.  As pointed out in the definition, this most commonly occurs with Internet service providers (ISP) and shared hosting providers that provide not only services for hosting a customer’s IT environment, but then accepts cards for payment for those hosting services.  From the hosting perspective, these organizations are a service provider and must comply with the PCI DSS for those services provided to their customers.  However, these organizations are also merchants because their customers can pay using a credit/debit card.

Some Closing Comments

Before I finish this post, I also want to add some comments regarding compliance reporting for service providers.

The first comment I would like to make is regarding reporting and compliance testing.  If you are a service provider, you only have the choice of a Self-Assessment Questionnaire (SAQ) D or a Report On Compliance (ROC).  If your organization processes, stores or transmits less than 300,000 card transactions, then you can use either the SAQ D or perform a ROC.  If your organization processes, stores or transmits 300,000 or more card transactions, then you are required to do a ROC.

If you are an ISP, MSS or similar service provider that does not process, store or transmit CHD/SAD, then you will not have a transaction count and therefore will fall on the under 300,000 transaction count rule.

Why would an organization that can do an SAQ D do a ROC?  If an organization desires to be listed on the Visa Global Registry of Service Providers or the MasterCard PCI Compliant Service Provider lists, then the service provider must do a ROC.  There are rules and fees for being included on these lists that each card brand Web site documents.  A knowledgeable QSA can help facilitate your listing on these sites as well as conducting the requisite ROC assessment.

A quick side note regarding Visa and service providers.  Visa is conducting a separate service provider inventory program that is outside of their Global Registry program.  This new inventory process has confused a lot of service providers and QSAs alike including yours truly.  For about the last year or so, Visa has been “registering” all service providers in an attempt to create a complete inventory of service providers.  This service provider inventory program has nothing to do with the Visa Global Registry and does not put any organization that is processed through it on the Visa Global Registry.

It is very important for service providers to know that the Attestation Of Compliance (AOC) form for the service provider is very different from the merchant version of the AOC.  The AOC for service providers provides a list of the services provided by the service provider that were assessed for the AOC.  This information is necessary for customers to know if all of their services were assessed for PCI compliance.  If a service was missed, then the merchant is responsible for assessing that service for PCI compliance.  So it is very important that you ensure that all services provided to your customers that require PCI compliance be assessed for PCI compliance.

Then there are the number of times I have received an AOC from a service provider only to find that it is a merchant AOC, not a service provider AOC.  With v3 of the PCI DSS, the Council has created separate SAQ D forms for merchants and service providers that will hopefully cure some of this issue.  It is incumbent on service providers to make sure that when they sign the AOC that it is a service provider AOC and all of the services are listed.  If not, then you need to go back to your QSA and get the right AOC form with the right information created.

And finally, my biggest pet peeve with service provider AOCs.  Some QSACs create these wonderful “Certificates Of PCI Compliance” that, while they look really nice, have no meaning to your customers and their QSAs.  No matter how many times the PCI SSC has stated that the only officially recognized document out of a PCI assessment is the AOC, I still encounter these certificates as “proof” of PCI compliance.  When asked to provide the AOC, I then get the indignant response that I should have everything I need.  In one case, I was even told I could not possibly be a QSA because I did not recognize the certificate as proof of compliance.

As I stated earlier, the service provider AOC is required to ensure that all service provided were assessed and QSAs are required to have copies of all service provider AOCs in order to show that all third parties have been officially assessed for PCI compliance.  No AOC means that the service provider is not PCI compliant and must be assessed as part of the customer’s PCI assessment.

I hope we are all now on the same page regarding the concepts of a merchant and a service provider.

07
Jan
15

SAQ A And SAQ A-EP Clarification

With the advent of SAQ A and A-EP, there seems to be confusion as to what meets what for each SAQ.  I thought I covered this rather well in my post titled ‘Of Redirects And Reposts’.  But apparently that was not clear enough.

For outsourced eCommerce solutions, the criteria from SAQ A states it can be used if and only if:

“The entirety of all payment pages delivered to the consumer’s browser originates directly from a third-party PCI DSS validated service provider(s).”

For some service providers it appears that there seems to be a lot of misunderstandings as to what constitutes “originates directly from a third party”.  A lot of processors believe that if their customers’ Web sites are not storing cardholder data (CHD) or sensitive authentication data (SAD) then they are out of scope regardless of the method used to process a customer’s payment.  What they seem to forget is that applications that process and/or transmit CHD/SAD are in-scope for PCI compliance just as those that store CHD/SAD.

For SAQ A and A-EP, the Council took their lead from Visa Europe as to what is meant by “originates directly”.  Visa Europe’s Processing eCommerce Payments guide has a great matrix that explains the difference between SAQ A and A-EP by payment processing type and merchant level.

Visa Europe SAQ A SAQ A-EP ROC Matrix

With redirects and iFrames, the merchant’s Web server never comes into contact with the CHD or SAD because the customer is communicating directly with the transaction processor’s server.  PayPal is a prime example of a redirect and meets the criteria of SAQ A.  With a direct post, JavaScript, XML or any other techniques, the merchant’s eCommerce server is at least processing and/or transmitting the CHD/SAD to the processor’s servers.  That is because there is some form of code/executable/script/etc. that is running on the merchant’s eCommerce server thus placing it directly in-scope.

Where things seem to get confusing is with processors that offer multiple methods of completing payments.  Unfortunately, it also appears to be just as confusing to the processors’ sales personnel as well.  We have encountered numerous instances where the processor’s sales people believe all of their solutions make the merchant out of scope when only the redirect/iFrame solution they have provides such a scope reduction.  All of their other solutions place the merchant directly in-scope.

The bottom line is that it is extremely important to get the transaction processor to explain how a payment is processed to determine whether your server is or is not out of scope.  Even if the sales person says the solution is an iFrame or a redirect, make sure to quiz them enough to ensure that they truly are delivering you an iFrame or redirect solution.

But a word to the wise.  Security professionals will question a merchant’s decision to not worry about the security of their eCommerce Web server because there still is a risk even with the redirect or iFrame approaches.  That risk is that the code/executable/script/etc. that invokes the redirect or iFrame on the merchant’s server gets tampered with or changed and now invokes a Web site that is not the transaction processor’s Web site.  As a result, a merchant’s customers’ CHD/SAD could be sent to Timbuktu and no one would be the wiser until goods/services are not provided due to non-payment.

As a result, security conscious merchants will, at a minimum, ensure their eCommerce servers are properly security hardened, patched current and will monitor the code/executable/script/etc. for changes.  Should a change be detected, the server would then be brought offline and fixed to ensure that transactions are properly processed.

Hopefully this provides everyone with clarity on how to use these SAQs peroperly.

One additional thing I would like to point out.  If you look at the Level 1 merchant line of the Visa Europe matrix, it shows ROC subscripted with either an ‘A’ or an ‘A-EP’.  I point this out because if you meet the criteria of either of the SAQs but are a Level 1 merchant, you can mark all of the ROC requirements not in the respective SAQ as ‘Not Applicable’ and only provide testing evidence for those requirements in the relevant SAQ.

26
Dec
14

PCI Compliance Is Getting More Rigorous

When Visa and MasterCard trotted out their security standards back in 2002 and 2003, the large eCommerce merchants that got to see them complained that they were too much.  Fast forward more than a decade and we still hear complaints that the PCI standards are too much.  Well if you are still complaining, things are about to get worse with version 3.  And the ever more consistent rumor is that business as usual (BAU) will be coming in v4.  If that comes to pass, I know some people that will likely jump out of windows as they did in the 1929 stock market crash.

So how is the PCI DSS getting more rigorous?

I spent some time analyzing the PCI DSS v3 as I did with v2.  From an analysis of v3 to v2, here are some of my findings.

  • There is an overall 11% increase in the number of tests in v3 versus v2.
  • Tests requiring some form of documentation have increased a whopping 83%. Not that 83% more documents will be required, just that there are 83% more tests where documentation is reviewed.  I will have more on this later in the post.
  • The number tests requiring interviews is up 48%. Again, not necessarily involving more people, just more questions to be asked and answered.
  • Tests requiring an observation of a process or activity are up 31%. As with the others, this is not a wholesale jump in new observations, but more an increase in things that must be observed.
  • Tests involving sampling are up 33%. This actually is an increase in the number of things sampled, but not all of the 33% increase are new samples.  This increase is the result of more clarifications from the Council to have QSAs explain what was sampled as it was implied in v2, but not explicitly requested.

Speaking of sampling, not only are the number of tests involving sampling increasing but the PCI SSC has told all of the QSAs that the days of “poor” or “inappropriate” sampling are over.  I have seen Reports On Compliance where QSAs have literally used a sample of one out of thousands under the rationale of “they are all configured the same”.  If you only tested one, how can you even draw the conclusion that the remaining thousands truly are the same?  You cannot and that is a big reason why the Council is getting picky on sampling.

The Council are also tired of incomplete samples.  The example most often quoted is there are 100 servers, half are Windows-based and half are Red Hat Linux.  A lot of QSAs were stopping there and sampling say five of each and calling their work complete.  Wrong!

What the Council is pointing out is that the QSA must go deeper in some cases when choosing their samples.  In the example above, the QSA needs to know the function of those servers so that they sample them based on their function such as database server, directory server, application server, etc.  In addition, the Council is also saying that it may be necessary to consider the applications involved as well to ensure that sampling provides a more complete picture of the environment.  In an assessment involving multiple applications, it might be necessary to sample database and application servers used by each application and not just a random sample of servers.

Finally, sampling might be higher for an entity’s first assessment or the first assessment by a QSA after a prior QSA.  The reason is that a higher sample size is warranted because all might not be as it is represented and minimal sampling would likely not reveal any issues.  This is common in the financial audit industry in situations where a new auditor is coming into the organization or the operations of the organization have been under increased scrutiny by regulators, banks or their prior auditors.

I earlier stated that documentation testing was up 83% and that was related to more testing of the same documents already being collected.  That is not to say that the amount of documentation is not increasing.  Regarding the amount of documentation required for v3 versus v2, I am estimating a conservative increase of around 100%.  I have been hearing horror stories regarding the amount of documentation being requested for v3.  I would not be shocked if the amount of documentation a QSA requires is up by 150% to 200% in some instances, particularly those situations where the QSA was not necessarily collecting all of the relevant documentation they should have been collecting.  A lot of this increase is that document counts now include observations which were considered separately in v2.

Based on this information, you should not be shocked if your QSAC increases the fees they are charging you for assessing your PCI compliance under v3.  Someone has to conduct all of those tests and review all of the extra documentation generated.  Even QSACs that have been doing the right thing all along are seeing impacts in the increases in testing required by v3.  But it has been definitely worse for those QSACs that were doing as little as possible to get an assessment done.  They are seeing the most impact from these changes and will likely find them highly onerous and difficult to justify the huge increases in professional fees required to cover their higher costs.  As a result, I would not be surprised if a number of QSACs stop doing PCI assessments because of the new requirements put on them.

But why are the changes occurring?

The primary reason is to minimize the “wiggle room” QSAs have in their testing so that assessments from one QSA to another are more consistent.  There has to be flexibility given to a QSA because organizations are never alike.  In addition what is compliant to one QSA can be non-compliant to another even within the same QSAC.  That occurs because every individual has their own sense of risk acceptance and avoidance.  This issue should be able to be taken out of the equation through discussion of the issue with the QSA and their superiors and, if necessary, development of mitigation strategies.

Under v2, a QSA that had a high risk tolerance could deem an organization compliant when the evidence would indicate that the organization is not compliant.  Or a QSA with a low risk tolerance could say one or more requirements are not in place in the same situation.  The new Reporting Template is an attempt to take the extremes out and reduce the wide swings in what is and is not compliant.  However, the new version of the PCI DSS does still allow some wiggle room for QSA/ISA judgment.

In addition to taking extremes in risk acceptance out of the assessment process, the Council is also trying to address the issue with QSAs that are judging organizations as PCI compliant when the QSA’s documentation does not support such a claim.  While the majority of QSAs thought this issue was addressed with the Reporting Instructions in v2, based on what the Council is telling us is that it apparently was not.  So the Council is getting stricter and stricter on their guidance as to what is acceptable through the language in the Reporting Template/Instructions as well as through their QSA training.

Another reason for the rigor is the breaches that keep occurring.  Each breach supplies information that might need to be incorporated into the PCI DSS.  One of the best examples of this is requirement 8.5.1:

“Service providers with remote access to customer premises (for example, for support of POS systems or servers) must use a unique authentication credential (such as a password/phrase) for each customer.”

This new requirement is in response to the significant number of breaches where the attacker gained access to a merchant’s cardholder data by knowing the remote access credentials of a vendor that is supporting the merchant such as those vendors that support point of sale (POS) solutions or card transaction processing.

Finally, the changes are also an attempt to circumvent some of the “legal” arguments that occur between the QSA and their client.  I am not the only QSA that has encountered clients that come up with very legal-like arguments and interpretations of what a particular test requires.  As a result, the Council has attempted to use wording in the tests and related testing guidance that reduces or even eliminates such interpretation arguments.  However, in my experience, clients that take this “legal” approach to their assessment are not going to stop.  They are not interested in security, they are interested in “checking a box”.  But the Council does no one any favors by only allowing QSAs and ISAs to read and have copies of the Reporting Template/Instructions until the client goes through their first PCI assessment under the new testing.  The Reporting Template should be a public document not one that only QSAs and ISAs have access.

04
Dec
14

It Is The QSA’s Fault

“Usually when PCI-compliant companies are breached, the real culprit is the assessor, the person who confirmed the company had met the PCI Requirements.” Jeff Multz, Dell SecureWorks

This is a very interesting approach for an employee at a qualified security assessor company (QSAC) to use to drum up business, toss all QSAs, including his own organization’s QSAs, under the bus.  I know that is not what he meant to do, but that is certainly what he did with this statement in his posting a few days ago.

I think most QSAs know where Mr. Multz is coming from.  He is more than likely venting over losses to QSACs that we all know are more interested in revenue generation than security.  They further that goal by incenting their QSAs to do as many PCI assessments as possible in the shortest amount of time as well as identify opportunities for selling the QSAC’s security appliances to solve compliance problems.  And to just pile on, they further their revenue generation by being the low cost provider through a focus on volume of work over quality.  As Kurt Vonnegut said in Cat’s Cradle, “In this world, you get what you pay for.”

Getting back though to Mr. Multz and his statement that QSAs are responsible for all breaches, let us see how that plays out with a few breaches.

During the Target breach, it was the QSA that was socially engineered and gave away the keys to the kingdom and missed all of the alerts generated by the FireEye software.  At Neiman Marcus, it was the QSA that missed the alerts for 60+ days that the malware was reinstalling nightly.  It was the QSA that swapped out the points of interaction (POI) at Barnes & Noble for malware infested POI.

Sorry Mr. Multz, but it was employees and/or contractors at all of these organizations, not the QSA that had a part in these breaches and all breaches for that matter.  I really do not see how you can hold a QSA responsible for the inaction and errors of employees/contractors.  Organizations are not going to pay to have QSAs on site, 24×7, to babysit all of their employees to maintain compliance with PCI or any other compliance program.  Not only that, no security framework is ever going to stop breaches, all they do is hopefully minimizing the impact when a breach occurs.

However, Mr. Multz was not done.

“The PCI Requirements were created so that organizations would focus on securing their networks, but many assessors only focus on meeting the requirements rather than security.”

From this statement it is painfully obvious that Mr. Multz does not understand what an assessment is about and how the assessment process works.  The job of a QSA is to execute the tests as defined in the PCI DSS Reporting Template and report the results of that testing – nothing more, nothing less.  Organizations are judged by a QSA as compliant with the PCI DSS whether they are just squeaking by or if they have a full on security program next to none.  Organizations do not get “extra credit” or “atta boys” if they have gone beyond the requirements.

While the original intent of the standards was to focus on securing cardholder data, that got morphed by the wonderfully misdirected marketing job that was done by certain card brands before the PCI standards came together.  For those of us around the security industry more than a decade ago, we advised Visa and MasterCard to stop pushing their cardholder information security program (CISP) and site data protection (SDP) standards as “The Way” that was going to stop breaches.  We explained that, properly implemented, CISP and SDP should minimize the number of PANs obtained, but it would not completely stop breaches.  It was only recently that the card brands started to realize this fact and stop pushing the PCI standards as a panacea of security.  If you have noticed with the rollout of EMV, Visa, MasterCard and the PCI SSC have stated that EMV is not a “silver bullet” solution and in other statements stated there are no “silver bullet” solutions.  That is a long way from a decade ago when their security standards were sold as the “be all to end all” for stopping breaches.  Unfortunately for QSAs everywhere, that message is out there and we have to deal with it every day.

All of this is not to say that QSAs cannot and do not make recommendations to organizations regarding their security programs and how and where it needs to improve.  I constantly make suggestions during my PCI assessments on how my client needs to improve their security posture.  However, it is ultimately up to the organization to put such changes in place, not the QSA’s responsibility.  If an organization chooses inaction, I will bring it up again and again.  But as the old proverb states, “you can lead a horse to water, but you cannot make them drink”.

Where the PCI DSS assessment process truly fails is the point in time approach (with the exception of vulnerability scanning and a few other select requirements).  To address that shortcoming, the Council has introduced the concept of business as usual (BAU) and it is my guess that we will see that concept placed into the standard in the next version.  It will be then that QSAs will have to test PCI compliance over a 12 month period similar to testing procedures financial auditors perform for annual financial audits.

As a result, the inclusion of BAU as part of the PCI DSS will likely be the straw that breaks the camel’s back for a lot of organizations.  This is because BAU will require organizations to track their compliance with the PCI DSS 24x7x365 as they should have been doing all along.  But from experience, I can tell you that there is no organization I have ever encountered that was compliant with any standard all of the time because people make mistakes.  As such, BAU is designed to shed light on those mistakes and require organizations to identify them and remediate them.  For organizations just squeaking by, this will probably make PCI compliance truly impossible to achieve.  If you are one of those organizations complaining about compliance with the current PCI DSS, just wait until BAU gets added.  Organizations that are truly interested in security are already implementing BAU because they see the operational value in integrating security controls with their other business controls.  BAU will show the true colors of those organizations that want security versus those that are checking a box.

And that gets me to Mr. Multz’s actual reason for his post, what makes a good QSA?  Good QSAs understand that the world is not perfect nor is security.  Good QSAs know that compliance with the PCI DSS does not and will not eliminate breaches.  Good QSAs know that the goal of PCI compliance is to minimize security control errors, provide an ability to recognize security control errors as soon as possible and then remediate those security control errors such that the security controls are only non-compliant for the shortest possible amount of time.

But just because a company has such errors does not automatically mean that they are not PCI compliant.  A good QSA only judges an organization non-compliant when the QSA has evidence that problems are consistently recurring and are not being corrected in a timely manner or corrected at all.

I appreciate Mr. Multz’s frustration but as a QSA I do not appreciate him tossing me under the bus with the QSAs that are doing a disservice to PCI compliance.  Like any industry, there are good service providers and there are bad service providers.  Those of us in this industry all know who the bad ones are and we hope they will get weeded out.  But from my own long experience in consulting, that does not always happen.

So in my very humble opinion, Mr. Multz needs to suck it up and deal with it, but stop tossing QSAs under the bus in the process.  QSAs are only the messengers.

23
Nov
14

Face It, You Are A Poor Judge Of Risk

“The oldest and strongest emotion of mankind is fear, and the oldest and strongest kind of fear is fear of the unknown.” HP Lovecraft

We have a pop quiz today.

  1. Are you more likely to die from an alligator attack or a shark attack?
  2. Are you more likely to win the PowerBall lottery jackpot or become a movie star?
  3. Are you more likely to die in a vending machine accident or from a lightning strike?
  4. Are you more likely to be elected President of the United States or to date a supermodel?
  5. Are you more likely to die from influenza or from drowning?
  6. Are you more likely to catch influenza or Ebola?

The purpose of this pop quiz is to demonstrate how poorly we humans evaluate and understand risks. I have to admit I got caught on a couple of these as I did the research.

If anything, the Ebola discussion has brought this issue of risk judgment to the forefront given the unfounded fear people have of Ebola. As a mathematician by schooling it has fascinated me as I watch the media reports and government officials cave into the spread of fear over something very highly unlikely to occur to anyone in the general population.

Do not get me wrong. If I were a health care worker anywhere in the world, I would have concerns about my risk of catching Ebola. After all, they are on the front line and Ebola has around a 50% fatality rate. Add into that the informative, but frightening, video that Dr. Sanjay Gupta of CNN did on the difficulty of removing a containment suit without potentially infecting yourself, and it confirms the threat a health care worker should be feeling if confronted with a potential Ebola patient that is symptomatic.

But for anyone outside of health care, there should be little if any reason to be concerned. Yet a good percentage of the public is irrational when it comes to Ebola regardless of the fact that it requires contact with a symptomatic person’s bodily fluids in order to be infected. But unlike a person with influenza, an Ebola infected person that is contagious does not have the mobility required to have contact with people unless those people come to them. As a result, all of these mental gymnastics that people go through about the possibility that an infection could occur on a bus or the subway are silly because the person with Ebola when they are contagious would look worse than a zombie off of ‘The Walking Dead’, assuming they could even walk at that point.

I am sure you are all saying that this is all good and well, but what is the point here in regards to PCI?

Glad you asked. I bring this up because the PCI DSS is heading more and more to be driven by risk and the assessment of that risk. Yet as I have hopefully shown by my quiz questions, people and their organizations are poor at understanding and determining risks. So organizations need to get much better at performing risk assessments (if they are performed at all) so that they can truly understand and manage risks. That said, a risk assessment does not have to be, nor should it be, a huge “death march” of a project. A proper risk assessment should answer the following questions.

  • What are the risks to the organization? This does not have to be an exhaustive, all inclusive list as you find in the various risk assessment methodology frameworks. But should include all of the most likely risks. For PCI compliance, this risk assessment only needs to address the risks to those things that are in-scope for the assessment. However, most organizations need the risk assessment for other reasons, so it often contains all risks, not just PCI risks. If it does contain risks outside of PCI, you should add columns for your other requirements so you can filter out just the PCI, HIPAA, GLBA, FISMA and any other risk frameworks.
  • What is the likelihood of the risk occurring? Typically, I use a scale of 1 to 5 where 1 is it occurs infrequently and 5 represents that it occurs often. If something never occurs, then it should be removed from the list.
  • If the risk occurs, what is the impact on the organization? Here I use a scale of 1 to 3 where 1 is low, 2 is moderate and 3 is high.
  • Multiply the likelihood with the impact and you get the risk rating.
  • Sort the risk ratings from highest to lowest and you have your risk assessment rating completed.

But hold on, you are not done just yet. Now you need to set your organization’s risk threshold. This will likely be a very contentious discussion as you will find that people within the organization have widely differing views on the level of risk they are willing to accept. However, it is important to capture the highlights of this discussion so that you have documentation for future discussions as you discuss future risk assessment results and reset the organization’s risk threshold.

Risks that fall below a certain risk rating are accepted and management formally agrees to accept them. Those above that level you develop methods of mitigating and managing those risks. Under my rating system, the lowest score that can be achieved is 1 and the highest score is 15. A lot of organizations might say that a total score of below 4 is to be accepted. For some organizations a better approach to accepting risk is sometimes to only accept those risks that have an impact of ‘Low’ (i.e., equal to 1). Therefore, all moderate and high impact risks are mitigated and managed.

Once you have your analysis done you will have a list of risks that require mitigation and management through monitoring and other methods.

Answers

  1. According to the Florida Museum of Natural History, between 1948 and 2005 there were 391 alligator attacks resulting in 18 fatalities whereas there were 592 shark attacks with 9 fatalities. That makes the alligator fatality rate almost three times as high as the shark fatality rate.
  2. The odds of winning the PowerBall are around one in 175M. While still incredibly long, the odds of becoming a movie star are significantly lower at one in 1.5M.
  3. Lightning is more deadly but do not underestimate that vending machine. According to the US National Oceanic and Atmospheric Administration (NOAA), the odds of being hit by lightning in the US are one in 1.9M. According to the US National Safety Council, there is a one in 112M chance of dying in a vending machine accident.
  4. The odds are in your favor if you are interested in dating a supermodel. Even better than becoming a movie star. You have a one in 88K chance of dating a supermodel according to Ask the Odds. The odds of being elected President are slim at one in 10M.
  5. The US Centers for Disease Control (CDC) estimate that the odds of drowning are one in 31.4. The CDC estimates that the odds of dying from influenza are around one in 345K.
  6. The CDC estimates that one in eight people will catch the flu in any given year and as seen in a previous answer, there is a one in 345K chance that a person will die as a result. Given the population of the US is around 315M and only four people have actually caught the Ebola virus in the US, there is around a one in 78M chance of catching Ebola in the US but that could change slightly if more infected people enter the US.



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If your organization has a PCI opportunity, is in need of assistance with a PCI issue or if you would like the PCI Guru to speak at your meeting, you can contact the PCI Guru at pciguru AT gmail DOT com.

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