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India gave legal recognition to electronic documents on 17th October 2000 as equivalent to paper, by notifying Information Technology Act 2000 (ITA 2000). At the same time, a system of “Signing” of an electronic document was also given recognition in the form of “Digital Signatures” as defined in the Act itself. An authentication of an electronic document with digital signature was provided legal recognition as “Signature” on a paper document. The system that the Act defined as the accepted form of authentication of an electronic document was one which used hashing of the electronic document to be signed which is encrypted with the private key of an asymmetric crypto system. The legal recognition was conditional to the requirement that the standard algorithms for hashing and asymmetric encryption as notified by the Controller of Certifying Authorities (CCA) alone be used and that the digital certificate be issued by a licensed Certifying authority. The system of e-Sign which was notified last year is a different form of digital signature itself except that it is a “Single use system”.

Over the last 16 years, though digital signatures have come to be used mainly by the Companies for filing annual returns to the Ministry of Corporate Affairs and for filing Income Tax, its use for other commercial transactions have been minimal.

What is also observed is that the Banking industry has been conspiring against the system of digital signatures as a means of authentication of Cheques and Banking instructions and trying to project “Passwords” and “Two Factor Authentication” as a substitute for digital signature.

Recently, Indus Ind Bank has gone on a publicity blitz to promote “My Finger Print is My Password” and suggests its use through mobile phones to access Bank accounts. The ad campaign can be considered as attractive enough for many customers of Indus Ind Bank to start using the finger print enabled mobile phones to access the account with only the finger print.

In India, using finger print on paper documents have been in use since times immemorial partly because it was considered as a “Signature” of an illiterate person and more reliable for property transactions. Many semi literate persons find it difficult to develop unique written signatures  and maintain consistency and in such cases, a thumb impression is easier to use though verification of a finger print may require some extra effort on the part of the person who wants to rely on the finger print. In case of Banks where a specimen thumb print is already registered, verification was possible but for others a written signature is more user friendly.

In recent days, after the Government took efforts to promote Aadhaar, there is a renewed interest in the use of “Finger Print” as a universal mechanism to authenticate an user of an electronic document. It will not be surprising that soon, finger print would be an acceptable form of authentication by other Banks as well and Government agencies to the extent that public may perceive it as a continuation of the paper based system of affixing thumb impression and adopt it readily.

It is here that there is a need to understand both the technical and legal risks associated with the use of thumb impressions (or finger print of any 10 fingers which is often used in mobiles) both by the public as well as the organizations and of course the Government, before too much hype is created on “Finger Print as Password” concept.

It must be considered as an eye opener that already a major fraud has been identified in Madhya Pradesh where a scam involving fake finger prints by proxy candidates in Police entrance examinations has been unearthed.

As per the details of the scam reported here in TOI , thumb impressions have been captured on films and converted into finger caps of “Synthetic bandages” which are then worn by the fraudsters  and used on the finger print scanners. This is a low tech and low cost fraud that can be committed every where the finger print is used to identify a person and should expose the myth that finger prints are secure form of authentication.

When a person voluntarily wants some body else to use his identity, (as in MP scam) he can share his password or provide a copy of his finger print to create a synthetic replica. If the user of the authentication is negligent not to recognize a different face or observe the cap on the finger, then he will also be in complicity with the fraudster all of them are together trying to cheat the system. No security can fight this collusion of three human beings. This risk is more a human risk than a techno legal risk and should be handled as such.

On the other hand, a frequent question we receive is why did ITA 2000 not recognize “Thumb Print Scan” as a form of “signature” though thumb impressions have long been used as a substitute for signature in the  physical world.  It must be remembered that thumb impression only identifies a person but a digital signature identifies both the person and the document that he is authenticating.  A thumb print (or a finger print) can be used in conjunction with the private key pair and hashing to replace the “password to invoke the private key”  but not to replace the private key altogether. Hence, the system of Indus Ind Bank does not qualify as a ITA 2000 compliant system and does not meet the RBI guidelines under the Internet Banking guideline of June, 2001 or E Banking security guidelines of April 2011.

If however, finger prints need to be used in replacement of passwords in say ATM machines, it is necessary that the system of identification of a finger print has to be improved with an identification as to whether the finger print is “Live or Not”. One of the technologies that is recommended for this purpose is “Poroscopy” where the sweat pores present between ridges is also used for identification purpose.

Some finger print scanners use the updated technology where by a “Liveness Score” is computed to check if the finger print is of a living person or not. The latex prints will obviously fail this test.

Despite these innovations, any form of identity verification in electronic domain involves capture and transmission of an electronic data at the point of use and its verification with a pre-registered version. If therefore the back end system can be manipulated by a suitable malware, it is not difficult for the server to be cheated to believe that “What it sees is what it is expecting”.

Hence it is unsafe to use any form of finger print scanning as a substitute to “Signature” in Banking transactions.  If a man in the middle attack can capture the finger print in an earlier transaction whether banking or otherwise, it is possible for the fraudster to use the same electronic file to spoof a “live finger print” in a subsequent attack on other transactions including banking transactions.

A man in the middle attack which steals a digital signature of one transaction however cannot be used in another transaction and to this extent, digital signature still has an edge. Digital signature may fail only of the digital certificate can be spoofed which may happen when the real time validation system is not used.

The increased publicity from Indus Ind Bank which can provide a false sense of security to the users of finger print as a means of authentication to critical resources though the insecure mobile network. In view of this and the MP scam, the CCA (Controller of Certifying Authorities)  needs to release an advisory to alert the public that they should not perceive that “Finger Print Banking” is “As safe as Digital Signature Banking”.

Judicial authorities should also take note that use of finger print for authentication does not indicate compliance of RBI guidelines by the Banks and hence continue to be treated as “Lack of Due Diligence” under section 85 or Section 79 of ITA 2000/8 and the liability for fraudulent transactions where digital signature has not been used will still lie with the Bank and not with the customer.

Naavi

(This article was first published on bfirst.in)

The tragic suicide of a girl in Salem who could not tolerate the threats to her dignity on the world of the face book and decided to end her life is an indication that Internet coupled with the omnipresent mobile has thrown a serious challenge to the society. The Challenge is to find the means to prevent the adverse impact of the virtual life on the real life of impressionable minds.

This is not the first time that a young life has been lost because of what happened on Facebook or Twitter nor it will be the last time. A couple of years back, an IIM Bangalore student ended her life because one of her boyfriends decided to “Un-Friend” her on face book indicating that even well informed and tech savvy persons who are successful in other aspects of their life can also be victims to this tendency of “Over reaction to Virtual Reality”  which we shall call, the “VROR syndrome”.

This menace needs the attention of the society in general and psycho analysts in particular.

In the Salem suicide case, the suicide note indicated that the girl decided to end her life for multiple reasons which we need to analyze.

The principle reason which was apparent was that a morphed picture showing her dressed in scantily clad clothes was posted by a boy on Facebook who threatened further to post more such pictures. She felt humiliated by the socially unacceptable image of herself being painted by the publication of the pictures. The boy was arrested two days after the suicide and has been charged for “Abetment to Suicide”. There were also two other contributory reasons which Cyber Sociologists should not ignore.

First was that a Complaint made to the Police remained unattended for more than 15 days. Police did not act until the second threat of further pictures being posted came to the girl prompting her to take the next step.

The other little obscure but equally important contributory factor was mentioned in the suicide note of the girl which stated that she did not receive a whole hearted support from her own parents in the matter, who might have distrusted her statement that the photos were fake. The fact that the perpetrator sent a direct WhatsApp message to the parents and threatened to do the same again would have made them mount abuse on her daughter  without understanding her own stress.

If we need to prevent recurrence of such events in the future, we need to address all these three causes that lead to the suicide. While the law will take its course regarding punishing the boy for multiple offences such as “creating false electronic documents”, “Causing defamation”, “Threatening”, “Outraging the modesty of women”, “Publication of obscene electronic content”, which has the potential to cumulatively put him behind the bar for a long period of time,  the society needs to take its own steps so that such incidents do not recur.

In this direction, there needs to be action on the following three fronts.

1. Fighting the VROR Syndrome

Firstly, we need to ensure that Social media users do not over react to events on cyber space to the extent of considering suicide as a means to escape the adverse turns in their Cyber life.

The Psychologists and Cyber Sociologists should recognize this VROR syndrome as a psychological disorder induced by an addiction to cyber living and believing that the “Virtual Reality” is “Reality itself”. They need develop appropriate measures to mitigate the risks associated with VROR syndrome in their interaction with the vulnerable sections of the society.

VROR syndrome should be recognized as a field of study by the community and measures to counter its adverse impact on society should be identified.

A wide awareness of the adverse effect of VROR syndrome should be created through immediate  programs to be conducted in Schools and Colleges for which the Principals of educational institutions should take necessary action. Such programs should encourage victims to fight cases of harassment or trolling rather than succumbing to the pressures.

2. Informing the Uninformed

 Additionally,  there is also a need to simultaneously address the older generation in the society who create pressures on the victims of social media abuse because of their won ignorance. The parents of the Salem girl who committed suicide perhaps were not aware of what is “Morphing” and how frequently it is used by deranged criminals to harass girls either for “Stalking”, or “striking vengeance for rejection” or “blackmailing”. If they had the awareness of such happenings, they would have sympathized with their daughter as a “Victim” and come to her moral support to fight the injustice meted out to her both by the erring boy as well as the delayed delivery of justice by the Police.

The “Social Media” related awareness programs should therefore be also directed towards those who are today non-users of the social media. This “Social Media Awareness Program for Non Social Media users” is therefore also an important strategy in prevention of incidents of VROR.

3. Strengthening the Law

Our discussion will  be incomplete if we do not point out that there was a “Section 66A” in Information Technology Act 2000/8 which addressed the issue of harassment through messages in Mobile or Internet and acted as a deterrrant to the offences of abuse and harassment through messages.

Unfortunately, Supreme Court scrapped it in March 2015, under the false pretext of “Upholding the Right to Freedom of speech” and a wrong message was sent to all abusers that “Abusing a person on Facebook or Twitter is Free Speech guaranteed by our Constitution and protected by Courts”.

This has created confusion amongst the Police on how to address internet related harassment complaints and a fear that they will be criticized by the Courts as well as the media if they invoke harsh measures. This could well be a contributory reason why Police failed to act in the first 15 days though they were able to crack the case in the next to two days as soon as the seriousness of the complaint was realized after the suicide.

It is now time to correct the perception that “Cyber Abuse is Free Speech”  which can be done only by re-instating Section 66A of Information Technology Act 2000/8 by the Supreme Court taking up a Suo Moto review of the Shreya Singhal judgement and reversing the decision.

Naavi

[This is a continuation of our discussions on Cyber Insurance Survey-2015 ending with our previous article : …Who Should Get Insurance Cover?]

Last Friday (15th July), TATA AIG conducted a conference in Bangalore attended mainly by CFOs of different industries in Bangalore to promote their “Cyber Insurance” product. Cyber Insurance in India is being talked about for more than 5 years but companies have been hesitant to push the product aggressively because of the fear that Cyber Risks may be too hot to insure. Most of the time the Insurance companies have been tentative in their approach and are reluctant to discuss their policy offers in detail and in open. In this background, it can be appreciated that Tata AIG at least considered spending some marketing rupees on promoting their product though they hedged the marketing cost with their more popular D&O policy (Directors and Officers Liability Insurance) covering Director’s liabilities for negligence and omissions under the new Companies Act.

The interaction followed the familiar logic that “Cyber Risks are growing and Companies may be facing huge liabilities and existential risks like what Sony or Ashely Madison faced recently or some of the ransom ware threats faced by Indian companies and therefore they need to go for Cyber Insurance.

However, the meeting failed to address the most important aspect of “Cost of Insurance” and how it can be brought down. Obviously, as the Risk grows, companies would be willing to consider Cyber Risk insurance but unless the policy is reasonably priced, it is difficult to expect Companies to really cover their risks.

According to a recent press release from TATA AIG itself, the policy premia for a Rs 5 Crore limit range from Rs 5 to 10 lakhs for manufacturing industry, the education sector and for consulting, accountancy and similar professional services. This may go up to Rs 25 lakhs for financial services, health are and telecom industry. This indicates that in the industry segment where there is a need for insurance cover and also some acceptability of the cost the premia could be Rs 25 lakhs for cover of Rs 500 lakhs or nearly 5%. Can a Flipkart or Ola or even a Bank consider 5% as the cost of insurance is doubtful.

Secondly, incidents like Sony and Ashely Madison make good discussion point for creating the threat perception but it is difficult to believe that a Cyber Insurance policy would cover what was perhaps a Cyber War attack in the case of Sony or a patently illegal business of Ashely Madison. Such companies may take the insurance only for the sake of projecting their commitment to cover the risks but their claims are unlikely to be accepted when the d-day arrives.

When we conducted the Cyber Insurance Survey 2015 therefore we tried to get the perception about how the premia in a Cyber Insurance policy is determined.

Cyber Insurance policy being a hybrid policy that is having cover for both the “First Party Loss” and “Third party liability”, the premia could be “Asset Value Based” for the First Party loss and “Discretionary Based” for Third party liability. However, the Insurance companies are not transparent about their premium policy  and hence insurers are not sure where they stand on the cost of insurance as well as the success of their claims if required.

During our survey, 82% of the respondents felt that the premium should be fixed on the basis of assets covered and equally 86% felt that it should be based on the liability basis. The respondents of the survey might not have been clear about whether the “Value of Assets” meant the total assets of a particular type that are being covered or the value chosen by the insurer and whether there is any agreement on how to value the “Data Asset” as different from the value of hardware and software. Should data be valued at “Potential Liability in case of a breach” or “Cost of Acquisition” is not an easy question to answer and there is no confirmation whether either the Insurers or the Insured have a clear understanding of this aspect.

The corporate respondents felt that discounts on premia should be based on the status of the security posture of an organization such as “Having been subjected to Compliance audits” and “Robustness of the Information Security Policy” followed by the company. On the other hand to what extent “Past Incidents” some of which might not have resulted in any liability should influence the premium fixation. More than 82% of the respondents of the survey had expressed the view that discounts should be provided for different IS audits to distinguish between two companies with similar risk profiles but different risk mitigation efforts.

TATA AIG only indicated that their proposal will be vetted by a team from KPMG which may make an assessment of the risk before quoting the premium. Greater transparency on such matters is needed before potential customers can give a serious thoughts. Similarly there was a need for TATA AIG to explain if they had faced any claim situation in India and if so of what type and how it was responded to. Without sharing of such information in generic terms, it is difficult for companies to take a view on the feasibility of Cyber Insurance.

I hope TATA AIG would in their future interaction with the industry try to be a little more transparent and let the companies develop some trust in the feasibility of Cyber Insurance. ..and of course 5% premium is considered usurious and it will be difficult for any company to set aside such a huge percentage of their resources for a potential liability cover.

Surely, the dilemma of the Insurance Companies on the enormity of the risks is understandable but they need a better understanding of the Cyber threats, Vulnerability management and the real rupee risks in India before trying to quote impractical premiums.

Hopefully the Insurance companies will realize that there is a huge market potential for Cyber Insurance in India and if they can quickly increase their risk assessment and risk pricing skills, there is a good business to harness. The other insurers such as ICICI Lombard and HDFC Ergo who also have Cyber Insurance policies need to take lessons from TATA AIG which claims to be the market leader at this point of time and structure their own offerings attractively.

Naavi

According to the article published in Bankinfosecurity.in, it appears that the wait of the Cyber Crime victims for CyAT (Cyber Appellate Tribunal) chairperson to be appointed is still not over. Going by the statement of the registrar of CyAT quoted in the article, there appears to be no agreement on the appointment till date.

Now that Mr Ravishankar Prasad is the Minister for both the IT Ministry and the Law Ministry, there cannot be any difficulty in finalizing the candidate from the Government side. It is the Judiciary which is unable to accept any appointment recommended by the Government and is stalling the process of appointment. This will not only inconvenience the public but also further burden the Courts with litigation which could be disposed off by the alternate means of CAT to some extent.

If the Ministry was unable to find a proper person, I would have expected the Judiciary to voluntarily suggest a suitable person from its own search amongst the community of retired Judges, instead of standing on formalities and protocol over citizen centric action. As a result of this lack of flexibility in administration, the standoff between the Judiciary and the Government on the appointment of Judges has not yet been resolved.

Management professional agree that when professionals and experts in specific fields take over administrative duties, they are often unable to see the different requirements of administration and prioritize it over other domain specific issues. Such things are normally seen when say a renowned scientist becomes the head of an organization or even when the best software developer becomes the head of a software company, or a famous surgeon becomes the head of a Hospital or an excellent Engineer becomes the CEO of his engineering firm. Similarly, while Modi has effectively switched hats from being a politician to being the administrative head of the country, Mr Kejriwal has not been able to make a similar switch.

The Role of being an expert in a field and Being a good administrator are different and one has to make a conscious effort to be able to successfully wear the two hats simultaneously.

Perhaps, a similar issue is affecting the administration of  Judiciary which is in the hands of professional Judges both at the State and the Central level. Good Judges donot always make good Justice administrators whether they are Chief Justices in a State level High Court or the Chief Justice of India. Some may be adaptive and successfully change over from sitting on the Judicial bench to behind the office table with ease but some may find it difficult.

It is time that the Judiciary becomes conscious of this possibility and takes corrective steps as may be necessary.  It is also time for the CJI shows some statesmanship in dealing with the Government and take steps to overcome the differences  and facilitate the movement of the wheels of justice.

We, the Citizens of India often see that Supreme Court is more interested in spending its time on worthless Celebrity cases and Political cases and show no urgency in disposing off issues involving interest of individuals. Citizens of India have nothing to gain from such lopsided prioritization of justice delivery under a false sense of “Independent Judiciary” when for most members of public, there is “No Judiciary”.

A standing example of such skewed prioritization is the lack of attention on this appointment of the Chair person of Cyber Appellate Tribunal pending from June 2011 where one (not hundred judges for different Courts) suitable person has not been found for last 5 years.

Naavi

Mr Rajesh Aggarwal was one of the most active IT secretaries in recent times who pursued diligently his additional responsibility as an “Adjudicator” under Section 46 of Information Technology Act 2000. Unfortunately, he was shifted some time back to duties in Delhi. Since then no cases seem to have progressed in Mumbai and the doors of justice have been shut on the Cyber Crime victims in Mumbai.

As of now it appears that IT Secretaries all over the country are not keen to accept the responsibility which was given to them as custodians of justice for Cyber Crimes and unless Mr Ravishankar Prasad who is currently the Minister for both the IT and Law ministry takes some immediate action the status of Cyber Judiciary in India will remain pathetic and adversely affect the “Ease of Doing Business Index” of the country which prime minister Mr Modi keenly observes.

It has now been reported that two advocates of Nagpur have moved the High Court through a writ petition No.3816/2016 filed by Nirmalkumar Athawale against

1) Govt of India through Department of Electronics and Information technology and

2) Government of Maharashtra through its Chief Secretary and

3) Adjudicating Officer Maharashtra

which was heard on 7th instant by Hon.High Court’s Division bench consisting of Hon.Justice Vasanti Naik and Justice S.Joshi.

Advocate Mahendra Limaye and Adv.Chetan Dhore represented petitioner and prayed for directions to be issued to Adjudicating Officer for timely conduction of Civil matters as mandated under Information technology Act.

It is reported that it was contended by Adv.Mahendra Limaye,the lawyer for petitioner that more than 100 matters are pending before Adjudicating Officer since last 18 months but he has not taken up any of them. It was also informed to the High court that office of adjudicator also failed to timely en-cash court fees submitted to it shows apathy towards Cyber Litigation. In the prayer clause petitioner has reportedly prayed for setting up benches of Adjudicating officers at every district headquarter place since currently all the litigants are required to file the matter at Mumbai only .