The History Of Secure Electronic Transaction

Published Date: 02 Nov 2017

MasterCard and Visa realized that for e-commerce payment processing, software vendors were coming up with new and conflicting standards. Microsoft mainly drove these on one hand, and IBM on the other. To avoid all sorts of future incompatibilities, MasterCard and Visa decided to come up with a standard, ignoring all their competition issues, and in the process, involving all the major software manufacture. (2)

SET Participants (Fig 1)

Cardholder: Using the Internet, consumers and corporate purchasers interact with merchants for buying goods and services. A cardholder is an authorized holder of a payment card such as MasterCard or Visa that has been issued by an Issuer. (2)

Merchant: A merchant is a person or an organization that wants to sell goods or services to cardholders. A merchant must have a relationship with an Acquirer for accepting payments on the internet. (2)

Issuer: The issuer is a financial institution (such as a bank) that provides a payment card to a cardholder. The most critical point is that the issuer is the ultimately responsible for the payment of the cardholder’s debt. (2)

Acquirer: Is a financial institution that establishes an account with a merchant and processes payment card authorizations and payments. The acquirer provides authorization to the merchant that a given card account is active and that the proposed purchase does not exceed the credit limit. The acquirer also provides electronic transfer of payments to the merchant's account. Subsequently, the acquirer is reimbursed by the issuer over some sort of payment network for electronic funds transfer. (2)

Payment Gateway: This is a function operated by the acquirer or a designated third party that processes merchant payment messages. The payment gateway interfaces between SET and the existing bankcard payment networks for authorization and payment functions. The merchant exchanges SET messages with the payment gateway over the Internet, while the payment gateway has some direct or network connection to the acquirer's financial processing system. (1)

Certification Authority (CA): This is an authority that is trusted to provide public key certificates to cardholders, merchants and payment gateways. (2)

Fig1 Fig 2

The purpose of the dual signature is to link two messages that are intended for two different recipients. In this case, the customer wants to send the order information (OI) to the merchant and the payment information (PI) to the bank. The merchant doesn't need to know the customer's credit card number, and the bank doesn't need to know the details of the customer's order. The customer is afforded extra protection in terms of privacy by keeping these two items separate. However, the two items must be linked in a way that can be used to resolve disputes if necessary. The link is needed so that the customer can prove that this payment is intended for this order and not for some other goods or services. (Fig 2)

Suppose that the customer sends the merchant two messages: a signed order information (OI) and a signed payment information (PI), and the merchant passes the PI to the bank. If the merchant can capture another OI from this customer, the merchant could claim that this OI goes with the PI, rather than the original OI. (2)

Dual signature is important because it accomplishes several things:

It authenticates the purchaser to the seller without disclosing client financial information. It authenticates the purchaser to the credit card company without disclosing information about the purchase.

It is important for all principles be authenticated, because fraud could happen on either end of the transaction. A purchaser could be using a fake credit card account, or the seller could be a fake company. The credit card company is responsible, during the transaction, for authenticating to the seller that the purchaser is authentic.

References:

http://www.informit.com/articles/article.aspx?p=26857&seqNum=3

http://www.indicthreads.com/1496/security-and-threat-models-secure-electronic-transaction-set-protocol/

Question 5.2

Checking the outgoing traffic may help to check if confidential or sensitive information or data are leaking out through software, or some employees, by checking for specific protocol header or signature in the traffic, it can prevent attacks from inside on outside machines through users or software like worms or viruses.

A lot of companies neglect to control the outgoing traffic, there is a real risk that users can introduce malicious code into the network by opening an email attachment or by surfing to a website that might have malicious content that installs a back door program on an internal system. These back doors initiate connections to an attacker that, from the firewall perspective, seem to be coming from inside and are therefore allowed. The reality is that back doors can allow attackers to take over control of an internal system and create considerable damage such as the South Carolina breach. (3)

Suppose you open an e-mail message or visit a website that contains a hidden malicious program that’s designed to secretly install itself on your machine and then proceed to send information out through the Internet to steal your personal information or act as a distributed denial of service DDoS attack zombie. This is currently the most common method of infection. (3)

Since the traffic generated by such programs would seem legitimate, meaning that it looks like it came from inside your network, it would generally be allowed to leave your network. The malicious traffic could be blocked if the hardware firewall was configured to block outgoing traffic on the particular TCP/IP port(s) the program was using, but given that there are over 65,000 possible ports and there's no way to be sure which ports a program of this nature might use, the odds of the right ones being blocked are slim. (3)

In Fact, blocking ports also prevents legitimate programs running on any of your networked PCs from using them. For example, a piece of malware that was designed to generate and send spam e-mail from your machine could not be blocked by a hardware firewall without also blocking your ability to use Microsoft Outlook or other email application in which they generate the same kind of traffic.

The firewall should be also set to monitor for abnormal behavior, such as large outbound traffic from internal machines that typically would not be generating significant outbound traffic.