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FTC slaps TRENDnet with 20 years' probation over webcam spying flaw

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The Federal Trade Commission has reached a settlement with US wireless webcam manufacturer TRENDnet that will commit the firm to third-party security audits for the next 20 years, plus two years of free technical support for its customers.

The FTC began its investigation last year after a list of the IP addresses of over 700 TRENDnet customers was posted online, allowing anyone to take a remote peek through the webcams' lenses. The company rushed out a security patch to fix the problem, but the FTC report says that TRENDnet failed in several of the most basic levels of secure software, and needed to be punished.

"The Internet of Things holds great promise for innovative consumer products and services," said FTC chairwoman Edith Ramirez in a statement. "But consumer privacy and security must remain a priority as companies develop more devices that connect to the Internet."

The report found in February 2010 that the firm added a Direct Video Stream Authentication (DVSA) feature, which allowed users to make the camera feeds public. The DVSA had a flaw that allowed the feeds to be secretly set as public regardless of the owner's settings, and the FTC noted that 20 models of the firm's cameras, some of which were branded under the title "SecurView", were vulnerable.

The FTC's investigation found that since April 2010 TRENDnet had not taken "reasonable steps" to ensure that its webcam products were secure. There was no security review of the original code base, nor any penetration testing done before the code's release. The FTC also notes that login names and passwords of the IP webcams were transmitted and stored on PCs and mobile in plain text, making them easy to slurp.

Under the terms of the settlement, the firm will face a security audit every two years for the next 20 years and is barred from "misrepresenting" the secure nature of its products. No direct financial penalty was made against the company, but TRENDnet has been instructed to contact customers about security issues, provide them with free technical support for the next two years, and appoint a chief security officer.

There is growing concern over the increasing attention software crackers are spending looking into flaws in devices such as webcams. Last month a Texas family found the webcam monitoring their two-year old daughter had been hacked, and a British or European man was heard shouting obscenities at the child.

In that case, the cracker had exploited a flaw in in the control software of the family's Foscom webcam and given himself root access. The family is reportedly looking into pursuing a class-action suit against the Chinese vendor.

There is a vast pool of unsecured or insecure hardware out there. In March a researcher managed to temporarily hijack 420,000 IPv4 devices by finding those requiring admin/admin or root/root username-password login, or no password at all to get root access. Thankfully he just used it to map out the internet, but the study raised some serious security questions.

There's no doubt that many manufacturers are now looking more seriously at the issue, but not quickly enough for the FTC. Searching on the vulnerability-scanning search engine Shodan still shows far too many vulnerable systems waiting to be cracked, and companies with an interest should check out their systems before the Feds take note. ®

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