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Bloomberg Spy Chip – Bullshit? This is Part 1 of a two-part investigative deep-dive into the accusations of Bloomberg’s recent article, ‘The Big Hack’. Written by Bob Flores, former CTO of the CIA, and Babak Pasdar, CEO of Acreto IoT Security. In a recent blog, Babak Pasdar highlighted a Bloomberg report that claimed China had embedded hardware spy chips on servers from Supermicro. Supermicro provides data-center servers used by many companies from small startups to the likes of Amazon and Apple. Bloomberg claims that the spy chips were discovered by a security auditor hired by Amazon AWS. This audit was part of an acquisition due diligence of Elemental Technologies, a platform specializing in multi-screen video processing. Bloomberg claims that Amazon and Apple are among the organizations impacted by the alleged Chinese spy chip. And one-by-one they have all denied that the story has merit. However, Bloomberg, a model agency in news reporting, has refused to offer any additional information or alternatively to pull the story. There is a lot about this story that doesn’t pass the smell test. If Supermicro servers have been compromised, it is a huge story. Though not a household name like Dell or HP, Supermicro is one of the top data center server platforms on the market. It is considered to be a good product with global availability at a fair price. In the article, Bloomberg makes a pointed accusation yet offers evidence that at best is vague. In the previous blog, we asked several questions: Who was the Security audit company that discovered the spy chip? How did they get access to schematics to do chip by chip validation of the hardware? Schematics that in any scenario would be considered trade secrets. If the spy chips were secretly installed by a Supermicro contractor as the article claims, who QA'ed the hardware and why was the chip not discovered during the QA process? Given the emphatic and detailed denials by both companies and the U.S. government, why has Bloomberg not released more detailed data to back up their claims? The implications are that China has backdoor access to countless systems, hosting applications and data, impacting thousands of companies and millions of individuals. The integrity of corporate, government and critical infrastructure is at stake – as well as personal data for large swaths of the population. Is This Realistically Possible? Bloomberg provided very little detail, and what they did provide was at best vague and not evidence-worthy. Based on the information they did provide, the industry take-away is that this vulnerability is via the server’s IPMI interface. IPMI is an always-on IoT embedded in a server to manage the hardware, even if the server is powered off. As presented, the IPMI platform can theoretically be manipulated to function as a back door, providing access to the server’s network, system memory and the system bus. You can learn more about this in Pasdar's previous blog on this issue on our website. Having said that, for Bloomberg’s vague spy chip explanation to work, you need a Supermicro motherboard with an on-board IPMI, and then many, many, many things have to line up for the compromise to work. First, an Internet accessible IPMI connection with stateful outbound access is needed -- something no self-respecting organization with even a moderately experienced infrastructure team would have. The chip Bloomberg presented in their article is just physically too small to store and execute the necessary code to fulfill its purpose, so it would also need to connect and download software from an external server. Hackers will never use an external server they own that references back to them. It would lead authorities right to them and there would be no plausible deniability. The server is most likely another compromised system on the Internet. Moreover, the external server's address isn't hard-coded into the chip. Compromised servers are disposable since the compromise may be discovered and addressed at any point – or the system moved or decommissioned. If this occurs, the entire effort of the compromise would be a complete waste. A process like fast-fluxing or something similar would be used to enable the spy chip to connect to an ever-changing botnet network of external servers. Fast-fluxing was specifically developed to control botnets without compromising the bot-master's identity. It is a technique where the spy chip and the external server would meet to communicate at a particular fully qualified domain name (FQDN) at a particular time. Many Different FQDNs spanning many different domains may be used to deliver content to the spy chip based on the then valid compromised IP addresses hosting the malware. The spy chip then needs to integrate into the server's OS, on-the-fly, during the boot process. This requires injecting the appropriate code for the specific OS used on the server. The OS could be one of dozens, if not hundreds of possible options since the Supermicro B1DRi motherboard that Bloomberg claims is compromised, is certified compatible for many different OSes and associated versions. This includes 32-bit Red Hat, SUSE, Ubuntu and FreeBSD as well as many versions of 64 bit Red hat, Fedora, SUSE, Ubuntu, Solaris, FreeBSD, Centos and Windows. Further, it also supports multiple hypervisor versions of VMWare, KVM and Xen Server, not to mention Amazon AWS's proprietary hypervisor. Each one of these OSes needs a different code. Even each version of the same OS may require an altogether different code to be injected into the compromised system. Consider how quickly the spy chip would have to act to intercept local boot code, determine the OS brand, distro and version from a smattering of code flying on a computer's bus, perform the fast-flux operation and fetch the appropriate compromise code from the appropriate server. All of this -- which is a lot -- needs to happen for the spy chip to work. Next Up: Bloomberg Spy Chip – Bullshit? Part 2: Let’s Break Down the Claims. Learn more or read online by visiting our web site: Acreto.io — On Twitter: @acretoio and if you haven’t done so, sign up for the Acreto IoT Security podcast. You can get it from Apple – Google or your favorite podcast app. About Acreto IoT Security Acreto IoT Security delivers advanced security for IoT Ecosystems, from the cloud. IoTs are slated to grow to 50 Billion by 2021. Acreto’s Ecosystem security protects all Clouds, users, applications, and purpose-built IoTs that are unable to defend themselves in-the-wild. The Acreto platform offers simplicity and agility, and is guaranteed to protect IoTs for their entire 8-20 year lifespan. The company is founded and led by an experienced management team, with multiple successful cloud security innovations. Learn more by visiting Acreto IoT Security on the web at acreto.io or on Twitter @acretoio.