One-time password tokens: Best practices for two-factor authentication

OTP tokens generate new PIN numbers every 30 to 60 seconds and can be used in addition to static user IDs and passwords to log on to a Web site. The idea is that if the static credentials are stolen, say, in a phishing attack, the malicious user would still have to guess the PIN to gain access. But since the time window is short to guess the PIN, it would be nearly impossible to break in.

MITM attacks and one-time passwords
Information security professionals have known for a while that OTP tokens are susceptible to man-in-the-middle (MITM) attacks. So the Citibank attack was no surprise. It was a real-time phishing attack, which is exactly what was expected. However, as scary as a real-time phishing attack may be, it requires that the hacker be at their keyboard at the right moment and act very quickly (like in 30 seconds) to gain access to the victim's online bank account. So unless it can be automated, it doesn't make a lot of sense for the serious criminal. Remember, phishing attacks are committed by organized criminal gangs interested in making a fast buck. This means constant monitoring of the victim online. Traditional phishing sites can harvest more prey, more efficiently, and make more money through passively harvesting credentials than the occasional one-off real-time attack,

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One-time password token best practices
There are two strategies for successfully and securely implementing OTP tokens: architecture of the token implementation and physical security of the tokens themselves.

In terms of architecture, the first consideration is placement of the token in your system. The most secure use of OTP tokens is for logging in to workstations locally or for accessing an internal network behind a firewall. In an internal network, where all servers are monitored (unlike the open Internet) an MITM attack isn't as likely. But that isn't much help for putting an OTP on a customer-facing Web site, which is the point of the FFIEC guidance. Therefore, a good approach for Web sites is to use Secure Sockets Layer (SSL) for the login page where the OTP value is entered instead of only for the following transaction pages. This encrypts all credentials – both the user ID and password, and the OTP's PIN – from the beginning. Login pages of some Web sites that use plain HTTP may pass credentials openly unencrypted over the Internet, where they can be sniffed.

But SSL itself can't stop a man-in-the-middle attack. SSL with mutual authentication enabled can provide some protection since both the server and client exchange certificates, preventing the type of server spoofing needed for MITM attacks. Design your site with the latest version of SSL that has mutual authentication.

Tokens are also vulnerable to theft, which is why their physical security is equally important for secure implementation. If tokens are stolen en route to customers along with the user's other login credentials, they're as good as compromised. The following are some tips for physically securing one-time password tokens:

Man-in-the-middle attacks will continue to plague one-time password tokens, but these suggestions should help mitigate the risk and allow for successful FFIEC compliance.

About the Author:
Joel Dubin, CISSP, is an independent computer security consultant. He is a Microsoft MVP in security, specializing in web and application security, and the author of The Little Black Book of Computer Security available from Amazon.

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