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Through their company on the Mediterranean island of Malta, Luigi Auriemma, left, and Donato Ferrante seek flaws in computer codes that customers can exploit. Governments pay hundreds of thousands of dollars to learn about and exploit flaws in the computer systems of foreign adversaries.

Gianni Cipriano • New York Times,

Hackers hit gold rush as governments get in game

  • Article by: NICOLE PERLROTH and DAVID E. SANGER
  • New York Times
  • July 13, 2013 - 7:36 PM

On the tiny Mediterranean island of Malta, two Italian hackers have been searching for bugs — not the island’s many beetle varieties, but secret flaws in computer code that governments pay hundreds of thousands of dollars to learn about and exploit.

The hackers, Luigi Auriemma, 32, and Donato Ferrante, 28, sell technical details of such vulnerabilities to countries that want to break into the computer systems of foreign adversaries. The two will not reveal the clients of their company, ReVuln, but big buyers of services like theirs include the National Security Agency — which seeks the flaws for America’s growing arsenal of cyberweapons — and U.S. adversaries like the Iranian Revolutionary Guard.

All over the world, from South Africa to South Korea, business is booming in what hackers call “zero days,” the coding flaws in software like Microsoft’s Windows that can give a buyer unfettered access to a computer and any business, agency or individual dependent on one.

Just a few years ago, hackers like Auriemma and Ferrante would have sold the knowledge of coding flaws to companies like Microsoft and Apple, which would fix them. Last month, Microsoft sharply increased the amount it was willing to pay for such flaws, raising its top offer to $150,000.

Increasingly, the businesses are being outbid by countries with the goal of exploiting the flaws in pursuit of the kind of success, albeit temporary, that the United States and Israel achieved three summers ago when they attacked Iran’s nuclear enrichment program with a computer worm that became known as “Stuxnet.”

The flaws get their name from the fact that once discovered, “zero days” exist for the user of the computer system to fix them before hackers can take advantage of the vulnerability. A “zero-day exploit” occurs when hackers or governments strike by using the flaw before anyone else knows it exists.

“Governments are starting to say, ‘In order to best protect my country, I need to find vulnerabilities in other countries,’ ” said Howard Schmidt, the former White House cybersecurity coordinator. “The problem is that we all fundamentally become less secure.”

A zero-day bug could be as simple as a hacker’s discovering an online account that asks for a password but does not actually require typing one to get in. Bypassing the system by hitting the “Enter” key becomes a zero-day exploit. The average attack persists for almost a year — 312 days — before it is detected, according to Symantec, the maker of antivirus software. Until then it can be exploited or “weaponized” by both criminals and governments to spy on, steal from or attack their target.

Ten years ago, hackers would hand knowledge of such flaws to Microsoft and Google for free, in exchange for a T-shirt or perhaps for an honorable mention on a company’s website. Even today, so-called patriotic hackers in China regularly hand over the information to the government.

Now, the market for information about computer vulnerabilities has turned into a gold rush. Disclosures by Edward Snowden, the former NSA consultant who leaked classified documents, made it clear that the United States is among the buyers of programming flaws. But it is hardly alone.

Israel, Britain, Russia, India and Brazil are some of the biggest spenders. North Korea is in the market, as are some Middle Eastern intelligence services. To connect sellers and buyers, dozens of well-connected brokers now market information on the flaws in exchange for a 15 percent cut. Some hackers get a deal collecting royalty fees for every month their flaw lies undiscovered, according to several people involved in the market.

Experts say there is limited incentive to regulate a market in which government agencies are some of the biggest participants.

Said Schmidt: “If someone comes to you with a bug that could affect millions of devices and says, ‘You would be the only one to have this if you pay my fee,’ there will always be someone inclined to pay it.

“Unfortunately, dancing with the devil in cyberspace has been pretty common.”

© 2014 Star Tribune