Gettin’ spanked over two-factor

OK, so I’ve been getting some flak from my post the other day about two-factor authentication and phishing. Pete Lindstrom over at spire gives me the wagging finger on the issue, saying that just because there is one phishing site using two-factor, it still has value; Mike Rothman over at Security Incite sides with Pete, pointing out that there is a security benefit to two-factor and saying that we shouldn’t downplay it because of one event. In light of the criticism, I thought it would be a good time to point out why I hold the position that I do – since I didn’t really do a full job of explaining my point in the previous post (at the time I wrote it, I didn’t think it would be so controversial) I think it makes sense to more thoroughly explain it.

Anyway, let me start by saying that I think both Pete and Mike are very astute analysts. More than that, I think they’re right: two-factor does have tremendous value from an overall security perspective. And suggesting that two-factor has no security value whatsoever would not be accurate or useful to our industry. However, I think it’s important that we, as users of these systems (and ultimately the folks who will bear the cost) stay focused on where the value of two-factor is – and where the value isn’t.

Historically, vendors have told us that two-factor will eliminate the phishing threat. For example, Microsoft said “If you get two-factor authentication to the consumer level, you reduce the phishing threat”, RSA said “Providing consumers with two-factor authentication… protects against phishing and identity theft” and Entrust told us that their solution would “provide identity theft protection and protection from phishing attacks.” Journalists told us that “The forced use of two-factor authentication for banking systems accessible over the Internet is our only hope for the mitigating the phishing threat” and the Anti-Phishing Working Group told the DHS that two-factor auth was a key step in preventing phishing attacks. When somebody suggests “forced use” of something, you probably want to make sure that it does in fact solve the problem in question. So does two-factor do these things? The answer to this question is the crux of the point I made the other day.

You see, just because a tool is good at doing one thing doesn’t mean it’s good at everything. For example, a pipe wrench is useful, but probably not for changing your tires. Sure, a pipe wrench can be used to turn nuts and all, but try to twist a lug-nut with it and you’ll get frustrated pretty quickly. It’s all about choosing the right tool. I think two-factor is like a pipe-wrench: a good tool for one thing (authenticating users), but not for doing other things (authenticating institutions). If the reason phishing exists is because of insufficient client authentication, it would be a great tool for phishing. But that’s not the cause of phishing. The cause of phishing is lack of server authentication. In other words, more authentication of the user doesn’t solve the problem. Sure, maybe it helps a little bit – maybe it makes it harder for a phisher to attack a given institution – and in so doing causes phishers to go after “the other guy.” But does it, like RSA and others said, “prevent” it? Clearly the answer is no, since somebody pulled it off the other day. Is it really our “only hope” like we were told by SecurityFocus? I hope not…

So, while I’m not saying that two-factor is completely valueless, I am saying that we should probably re-evaluate our assumptions about whether or not it solves phishing – particularly in light of direct evidence to the contrary.