Security fail: When trusted IT people go bad

One rogue IT employee can do more damage than an army of hackers. Here's how three companies could have better protected themselves.

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In addition, a forensic search of Ed's workstation uncovered a spreadsheet containing hundreds of valid credit card numbers from the company's e-commerce site. While there was no indication that the numbers had been used, the fact that this information was contained in a spreadsheet implied that Ed was contemplating either using the card data himself or selling it to a third party, according to Linkous.

The CFO, who had originally received the call from the BSA, and others on the senior management team feared what Ed might do when confronted. He was the only one who had certain administrative passwords -- including passwords for the core network router/firewall, network switches, the corporate VPN, the HR system, the e-mail server administration, Windows Active Directory administration, and Windows desktop administration.

That meant that Ed could have held hostage nearly all the company's major business processes, including the corporate Web site, e-mail, financial reporting system and payroll. "This guy had keys to the kingdom," says Linkous.

So the company and Linkous' firm launched an operation right out of Mission: Impossible. They invented a ruse that required Ed to fly overnight to California. The long flight gave Linkous' team a window of about five and a half hours during which Ed couldn't possibly access the system. Working as fast as they could, the team mapped out the network and reset all the passwords. When Ed landed in California, "the COO was there to meet him. He was fired on the spot."

Cost to the company

Linkous estimates that the incident cost the company a total of $250,000 to $300,000, which includes Sabera's fee, the cost of flying Ed to the West Coast on short notice, the cost of litigation against Ed, the costs associated with hiring a temporary network administrator and a new CIO, and the cost of making all of its software licenses legitimate.

Preventive measures

What could have prevented this disaster? Obviously, at least one other person should have known the passwords. But more significant was the lack of separation of duties. The retailer had a small IT staff (just six employees), so Ed was entrusted with both administrative and security responsibilities. That meant he was monitoring himself.

Separating duties can be a particularly tough challenge for companies with small IT staffs, Linkous acknowledges. He suggests small companies monitor everything, including logs, network traffic and system configuration changes, and have the results evaluated by someone other than the system administrator and his or her direct reports. Most important, he says, is to let IT people know that they are being watched.

Second, the company failed to do a thorough background check when it hired Ed. In CERT's research, 30% of the insiders who committed IT sabotage had a previous arrest history. In fact, any kind of false credentials should raise a red flag. Although the company had done a criminal background check on Ed (which was clean), it did not verify the credentials on his résumé, some of which were later found to be fraudulent. (He did not, for example, have the MBA that he claimed to have.)

Third, Ed's personality could have been viewed as a red flag. "He seemed to believe that he was smarter than everyone else in the room," says Linkous, who met Ed face-to-face by posing as an ERP vendor before the sting operation. Ed's arrogance reminded Linkous of the infamous Enron executives. "He was extremely confident, cocky and very dismissive of other people."

CERT has found that rogues often have prickly personalities. "We don't have any cases where, after the fact, people said, 'I can't believe it -- he was such a nice guy,'" says Cappelli.

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