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Chapter: Information Security : Security Investigation

Risk Control Strategies

Four basic strategies to control each of the risks that result from these vulnerabilities. ü Apply safeguards that eliminate the remaining uncontrolled risks for the vulnerability [Avoidance] ü Transfer the risk to other areas (or) to outside entities[transference] ü Reduce the impact should the vulnerability be exploited[Mitigation] ü Understand the consequences and accept the risk without control or mitigation[Acceptance]



Four basic strategies to control each of the risks that result from these vulnerabilities.


ü     Apply safeguards that eliminate the remaining uncontrolled risks for the vulnerability [Avoidance]


ü     Transfer the risk to other areas (or) to outside entities[transference]


ü     Reduce the impact should the vulnerability be exploited[Mitigation]


ü     Understand the consequences and accept the risk without control or mitigation[Acceptance]


1 Avoidance


   It is the risk control strategy that attempts to prevent the exploitation of the vulnerability, and is accomplished by means of


            Countering threats

            Removing Vulnerabilities in assets

            Limiting access to assets

            Adding protective safeguards.


   Three common methods of risk avoidance are


            Application of policy

            Application of Training & Education

            Application of Technology


2 Transference


   Transference is the control approach that attempts to shift the risk to other assets, other processes, or other organizations.


   It may be accomplished through rethinking how services are offered, revising deployment models, outsourcing to other organizations, purchasing Insurance, Implementing Service contracts with providers.


   Top 10 Information Security mistakes made by individuals.


            Passwords on Post-it-Notes


            Leaving unattended computers on.


            Opening e-mail attachments from strangers.


            Poor Password etiquette


            Laptops on the loose (unsecured laptops that are easily stolen)


            Blabber mouths ( People who talk about passwords)


            Plug & Play[Technology that enables hardware devices to be installed and configured without the protection provided by people who perform installations]


            Unreported Security Violations


            Always behind the times.


            Not watching for dangers inside the organization


3 Mitigation


It is the control approach that attempts to reduce the impact caused by the exploitation of vulnerability through planning & preparation.


ü Mitigation begins with the early detection that an attack is in progress and the ability of the organization to respond quickly, efficiently and effectively.


ü Includes 3 types of plans.


1. Incident response plan (IRP) -Actions to take while incident is in progress


2. Disaster recovery plan (DRP) - Most common mitigation procedure.


3. Business continuity plan (BCP) - Continuation of business activities if catastrophic event occurs.


1.Incident Response Plan (IRP)


   This IRP Plan provides answers to questions such as


            What do I do now?


            What should the administrator do first?


            Whom should they contact?


            What should they document?


2.The IRP Supplies answers.


ü For example, a system’s administrator may notice that someone is copying information from the server without authorization, signaling violation of policy by a potential hacker or an unauthorized employee.


ü The IRP also enables the organization to take coordinated action that is either predefined and specific or ad hoc and reactive.


3.Disaster Recovery Plan (DRP)


ü Can include strategies to limit losses before and during the disaster.


ü Include all preparations for the recovery process, strategies to limit losses during the disaster, and detailed steps to follow when the smoke clears, the dust settles, or the floodwater recede.


ü DRP focuses more on preparations completed before and actions taken after the incident, whereas the IRP focuses on intelligence gathering, information analysis, coordinated decision making, and urgent, concrete actions.


4.Business Continuity Plan (BCP)


2.    BCP is the most strategic and long term of the three plans.


It encompasses the continuation of business activities if a catastrophic event occurs, such as the loss of an entire database, building or operations center.



- The BCP includes planning the steps necessary to ensure the continuation of the organization when the scope or scale of a disaster exceeds the ability of the DRP to restore operations.


- Many companies offer this service as a contingency against disastrous events such as fires. Floods, earthquakes, and most natural disasters.


4 Acceptance


- It is the choice to do nothing to protect a vulnerability and do accept the outcome of its exploitation.

- This strategy occurs when the organization has:


            Determined the level of risk.

            Assessed the probability of attack.

            Estimated the potential damage that could occur from attacks.

            Performed a thorough cost benefit analysis.

            Evaluated controls using each appropriate type of feasibility.


             Decided that the particular function, service, information, or asset did not justify the cost of protection.


5 Selecting a Risk Control Strategy


- Level of threat and value of asset play major role in selection of strategy


- Rules of thumb on strategy selection can be applied:


            When vulnerability (flaw or weakness) exists: Implement security controls to reduce the likelihood of a vulnerability being exercised.


            When vulnerability can be exploited: Apply layered protections, architectural designs, and administrative controls to minimize the risk.


            When the attacker’s cost is less than his potential gain: Apply protections to increase the attacker’s cost.


            When potential loss is substantial: Apply design principles, architectural designs, and technical and non-technical protections to limit the extent of the attack, thereby reducing the potential for loss.


6 Evaluation, Assessment & Maintenance of Risk Controls


   Once a control strategy has been implemented, it should be monitored, & measured on an ongoing basis to determine the effectiveness of the security controls and the accuracy of the estimate of the Residual risk


   There is no exit from this cycle; it is a process that continues for as long as the organization continues to function.




Categories of Controls


ü Controlling risk through avoidance, Mitigation or Transference may be accomplished by implementing controls or safeguards.

ü Four ways to categorize controls have been identified.


–   Control function


        Preventive or detective


–  Architectural layer


        One or more layers of technical architecture


–  Strategy layer


        Avoidance, mitigation …


–  Information security principle


Control Function


· Safeguards designed to defend systems are either preventive or detective.


· Preventive controls stop attempts to exploit a vulnerability by implementing a security principle, such as authentication, or Confidentiality.


· Preventive controls use a technical procedure, such as encryption, or some combination of technical means and enforcement methods.

· Detective controls – warn organizations of violations of security principles, organizational policies, or attempts to exploit vulnerabilities.


· Detective controls use techniques such as audit trails, intrusion detection and configuration monitoring.


Architectural Layer


ü Controls apply to one or more layers of an organization’s technical architecture.

ü The following entities are commonly regarded as distinct layers in an organization’s


Information architecture.


             Organizational policy.


             External Networks.


             Extranets ( or demilitarized zones )


             Intranets ( WANs and LANs )


ü     Network devices that interface network zones.(Switches, Routers, firewalls and hubs)


ü     Systems [ Mainframe, Server, desktop]


ü     Applications.


Strategy Layer


1.   Controls are sometimes classified by the risk control strategy they operate within:








Characteristics of Secure Information


ü     Confidentiality


ü     Integrity


ü     Availability


ü     Authentication


ü     Authorization


ü     Accountability


ü     Privacy


Confidentiality: The control assures the confidentiality of data when it is stored, processed, or transmitted. An example of this type of control is the use of Secure Sockets Layer (SSL) encryption technology to secure Web content as it moves from Web server to browser.


Integrity: The control assures that the information asset properly, completely, and correctly receives, processes, stores, and retrieves data in a consistent and correct manner .Ex: Use of parity or cyclical redundancy checks in data transmission protocols.


Availability: The control assures ongoing access to critical information assets. Ex: Deployment of a network operations center using a sophisticated network monitoring toolset.


Authentication: The control assures that the entity (person or computer) accessing information assets is in fact the stated entity. Ex: The use of cryptographic certificates to establish SSL connections, or the use of cryptographic hardware tokens such as SecurID cards as a second authentication of identity.


Authorization: The control assures that a user has been specifically and explicitly authorized to access, update, or delete the contents of an information asset. Ex: Use of access control lists and authorization groups in the Windows networking environment. Another example is the use of a database authorization scheme to verify the designated users for each function.


Accountability: The control assures that every activity undertaken can be attributed to a specific named person or automated process. Ex: Use of audit logs to track when each user logged in and logged out of each computer.


Privacy: The control assures that the procedures to access, update, or remove personally identifiable information comply with the applicable laws and policies for that kind of information.


7 Feasibility Studies


   Before deciding on the strategy (Avoidance, transference, mitigation, or acceptance), for a specific vulnerability, all the economic and non-economic consequences of the vulnerability facing the information asset must be explored.


   Cost Avoidance- It is the process of avoiding the financial impact of an incident by implementing a control.




            Cost Benefit analysis


            Organizational feasibility


            Operational Feasibility


            Technical Feasibility


            Political feasibility.


Cost Benefit Analysis (CBA)


ü Organizations are urged to begin the cost benefit analysis by evaluating the worth of the information assets to be protected and the loss in value if those information assets were compromised by the exploitation of a specific vulnerability.

ü The formal process to document this decision making process is called a Cost Benefit analysis or an economic feasibility study.

Cost Benefit Analysis    or an Economic Feasibility study


ü Some of the items that affect the cost of a control or safeguard include:


            Cost of development or acquisition [purchase cost] of hardware, software and services.


            Training Fees(cost to train personnel)


            Cost of Implementation[Cost to install, Configure, and test hardware, software and services]


            service Costs[Vendor fees for maintenance and upgrades]


            Cost of maintenance[Labor expense to verify and continually test, maintain and update]


ü Benefit is the value that an organization realizes by using controls to prevent losses associated with a specific vulnerability.


Amount of benefit = Value of the Information asset and Value at risk.


ü Asset Valuation is the process of assigning financial value or worth to each information asset.


ü Some of the components of asset valuation include:


1. Value retained from the cost of creating         the information asset.


ü     Value retained from past maintenance of the information asset.


ü     Value implied by the cost of replacing the information.


ü     Value from providing the information.


ü     Value incurred from the cost of protecting the information.


ü     Value to owners.


ü     Value of intellectual property.


ü     Value to adversaries.


ü     Loss of Productivity while the information assets are unavoidable.


ü     Loss of revenue while information assets are unavailable.




ü The organization must be able to place a dollar value on each collection of information and the information assets it owns. This value is based on the answers to these questions:


      How much did it cost to create or acquire this information?


      How much would it cost to recreate or recover this information?


      How much does it cost to maintain this information?


      How much is this information worth to the organization?


      How much is this information worth to the competition?





ü     A Single loss expectancy (SLE) is the calculation of the value associated with the most likely loss from an attack. It is a calculation based on the value of the asset and the exposure factor (EF), which is the expected percentage of loss that would occur from a particular attack, as follows:

Single Loss Expectancy (SLE) = Asset value x Exposure factor [EF]



ü EF à Expected percentage of loss that would occur from a particular attack.


ü The probability of threat occurring is usually a loosely derived table indicating the probability of an attack from each threat type within a given time frame (for example, once every 10 years). This value is commonly referred to as the annualized rate of occurrence (ARO)


ü The expected value of a loss can be stated in the following equation:


ü     Annualized loss Expectancy (ALE) which is calculated from the ARO and SLE.




Cost Benefit Analysis (CBA)Formula


ü CBA is whether or not the control alternative being evaluated is worth the associated cost incurred to control the specific vulnerability.


ü The CBA is most easily calculated using the ALE from earlier assessments before the implementation of the proposed control, which is known as ALE (prior).


ü Subtract the revised ALE, estimated based on control being in place, known as ALE (post). Complete the calculation by subtracting the annualized cost of the safeguard (ACS).

CBA = ALE (Prior) - ALE (Post) – ACS




   ALE prior is the Annualized Loss Expectancy of the risk before the implementation of the control.


   ALE post is the ALE examined after the control has been in place for a period of time.


   ACS is the Annual Cost of the Safeguard.



8 Bench Marking


   An alternative approach to risk management


   Process of seeking out and studying the practices used in other organizations that produce results you would like to duplicate in your organization.

   One of two measures typically used to compare practices:


Metrics-based measures


Process-based measures


   Good for potential legal protection.

   Metrics-based measures are comparisons based on numerical standards, such as:


              Numbers of successful attacks.


            Staff-hours spent on systems protection.


            Dollars spent on protection.


            Numbers of Security Personnel.


            Estimated value in dollars of the information lost in successful attacks.


            Loss in productivity hours associated with successful attacks.


The difference between an organization’s measures and those of others is often referred to as a performance gap. The other measures commonly used in benchmarking are process-based measures. Process-based measures are generally less focused on numbers and more strategic than metrics-based-measures.


Due Care/Due Diligence


- When organizations adopt levels of security for a legal defense, they may need to show that they have done what any prudent organization would do in similar circumstances - this is referred to as a standard of due care


- Due diligence is the demonstration that the organization is diligent in ensuring that the implemented standards continue to provide the required level of protection


- Failure to support a standard of due care or due diligence can open an organization to legal liability


Best Business Practices


ü Security efforts that provide a superior level of protection of information are referred to as best business practices

ü Best security practices (BSPs) are security efforts that are among the best in the industry


ü When considering best practices for adoption in your organization, consider the following:


–  Does your organization resemble the identified target?


–  Are the resources you can expend similar?


–  Are you in a similar threat environment?


Microsoft’s Ten Immutable Laws of Security


ü     If a bad guy can persuade you to run his program on your computer, it’s not your computer anymore


ü     If a bad guy can alter the operating system on your computer, it’s not your computer anymore


ü     If a bad guy has unrestricted physical access to your computer, it’s not your computer anymore


ü     If you allow a bad guy to upload programs to your web site, it’s not your web site anymore


ü     Weak passwords trump strong security


ü     A machine is only as secure as the administrator is trustworthy


ü     Encrypted data is only as secure as the decryption key


ü     An out of date virus scanner is only marginally better than no virus scanner at all


ü     Absolute anonymity isn't practical, in real life or on the web



10. Technology is not a panacea




ü The biggest problem with benchmarking in information security is that organizations don’t talk to each other.

ü Another problem with benchmarking is that no two organizations are identical

ü A third problem is that best practices are a moving target.


ü One last issue to consider is that simply knowing what was going on a few years ago, as in benchmarking, doesn’t necessarily tell us what.




ü Baselining is the analysis of measures against established standards,


ü In information security, baselining is comparing security activities and events against the organization’s future performance.

ü When baselining it is useful to have a guide to the overall process


Feasibility Studies and the Cost Benefit analysis


ü Before deciding on the strategy for a specific vulnerability all information about the economic and non-economic consequences of the vulnerability facing the information asset must be explored.


ü Fundamentally we are asking “What are the actual and perceived advantages of implementing a control contrasted with the actual and perceived disadvantages of implementing the control?”


Cost Benefit Analysis (CBA)


ü The most common approach for a project of information Security controls and safeguards is the economic feasibility of implementation.


ü Begins by evaluating the worth of information assets are compromised.


ü It is only common sense that an organization should not spend more to protect an asset than it is worth.


ü The formal process to document this is called a cost benefit analysis or an economic feasibility study.


CBA: Cost Factors


ü Some of the items that the cost of a control or safeguard include:

ü Cost of Development or Acquisition

ü Training Fees

ü Cost of implementation.

ü Service Costs

ü Cost of Maintenance

CBA: Benefits


ü Benefit is the value that the organization recognizes by using controls to prevent losses associated with a specific vulnerability.


ü This is usually determined by valuing the information asset or assets exposed by the vulnerability and then determining how much of that value is at risk.


CBA: Asset Valuation


ü  Asset Valuation is the process of assigning financial value or worth to each information asset.


ü  The valuation of assets involves estimation of real and perceived costs associated with the design, development, installation, maintenance, protection, recovery, and defense against market loss and litigation.


ü  These estimates are calculated for each set of information bearing systems or information assets.

ü  There are many components to asset valuation.


CBA: Loss Estimates


· Once the worth of various assets is estimated examine the potential loss that could occur from the exploitation of vulnerability or a threat occurrence.

· This process results in the estimate of potential loss per risk.

· The questions that must be asked here include:


–   What damage could occur, and what financial impact would it have?


–   What would it cost to recover from the attack, in addition to the costs above?

–   What is the single loss expectancy for each risk?


Organizational Feasibility


ü Organizational Feasibility examines how well the proposed information security alternatives will contribute to the efficiency, effectiveness, and overall operation of an organization.


ü Above and beyond the impact on the bottom line, the organization must determine how the proposed alternatives contribute to the business objectives of the organization.


Operational feasibility


ü  Addresses user acceptance and support, management acceptance and support, and the overall requirements of the organization’s stake holders.

ü  Sometimes known as behavioral feasibility, because it measures the behavior of users.

ü  One of the fundamental principles of systems development is obtaining user buy in on a project and one of the most common methods for obtaining user acceptance and support is through user involvement obtained through three simple steps:


·     Communicate


·     Educate


·     Involve


Technical Feasibility


ü The project team must also consider the technical feasibilities associated with the design, implementation, and management of controls.


ü Examines whether or not the organization has or can acquire the technology necessary to implement and support the control alternatives.


Political feasibility


ü For some organizations, the most significant feasibility evaluated may be political


ü Within Organizations, political feasibility defines what can and cannot occur based on the consensus and relationships between the communities of interest.


ü The limits placed on an organization’s actions or a behavior by the information security controls must fit within the realm of the possible before they can be effectively implemented, and that realm includes the availability of staff resources.


Risk Management Discussion Points


ü Not every organization has the collective will to manage each vulnerability through the application of controls


Depending on the willingness to assume risk, each organization must define its risk appetite


Risk appetite defines the quantity and nature of risk that organizations are willing to accept as they evaluate the tradeoffs between perfect security and unlimited accessibility


Residual Risk


ü When we have controlled any given vulnerability as much as we can, there is often risk that has not been completely removed or has not been completely shifted or planned for this remainder is called residual risk.

ü To express it another way, “Residual risk is a combined function of


\endash A threat less the effect of some threat –reducing safeguards.


\endash Vulnerability less the effect of some vulnerability- reducing safeguards.

3.  an asset less the effect of some asset value-reducing safeguards “


Documenting Results


ü At minimum, each infor mation asset-vulnerability pair should have a do cumented control strategy that clearly iden tifies any residual risk remaining after the proposed strategy has been executed.


ü Some organizations doc ument the outcome of the control strategy for each information asset-vulnerability pair a s an action plan


ü This action plan includ es concrete tasks, each with accountability assigned to an organizational unit or to an individual


Recommended Practices in Controlling Risk


We must convince budget authorities to spend up to the value of the asset to protect a particular asset from an i dentified threat

Each and every control or safeguard implemented will impact more than one threat-asset pair


Qualitative Measures


1.   The spectrum of steps described above was performed with real numbers or best guess estimates of real numbers-this is known as a quantitative assessment.


2.    However, an organization could determine that it couldn’t put specific numbers on these values.


3.    Fortunately, it is possible to repeat these steps using estimates based on a qualitative assessment.


4.    Instead of using specific numbers, ranges or levels of values can be developed simplifying the process


Delphi Technique


1      One technique for accurately estimating scales and values is the Delphi Technique.


2  The Delphi Technique, named for the Oracle at Delphi, is a process whereby a group of individuals rate or rank a set of information


3  The individual responses are compiled and then returned to the individuals for another iteration


4 This process continues until the group is satisfied with the result.


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