Flaw in cell phone encryption identified; Design process blamed; Telecommunications Industry Association algorithm for digital telephones fails under simple cryptanalysis.

MINNEAPOLIS--(BUSINESS WIRE)--March 20, 1997--Counterpane Systems and UC Berkeley jointly announced today that researchers have discovered a flaw in the privacy protection used in today's most advanced digital cellular phones.

This discovery points to serious problems in the closed-door process used to develop these privacy measures. This announcement is a setback to the U.S. cellular telephone industry, said Bruce Schneier of Counterpane Systems, a Minneapolis, MN consulting firm specializing in cryptography. The attack can be carried out in a few minutes on a conventional personal computer.

Schneier and John Kelsey of Counterpane Systems, along with graduate student David Wagner of the University of California at Berkeley, plan to publish their analysis in a paper entitled "Cryptanalysis of the Cellular Message Encryption Algorithm (CMEA)." Legislators are scheduled to hold hearings today on Rep. Goodlatte's "SAFE" (Security And Freedom Through Encryption) bill, HR695.

The problem affects numbers dialed on the key pad of a cellular handset, including any telephone, PIN, or credit card numbers dialed. The system was supposed to protect the privacy of those dialed digits, but the encryption is weak enough that those digits are accessible to eavesdroppers with a digital scanner.

The cryptographers blame the closed-door design process and excessive pressure from U.S. military interests for problems with the privacy standard. The cellular industry attempted to balance national security with consumer privacy concerns. In an attempt to eliminate recurring security problems, the cellular standards arm of the Telecommunications Industry Association (TIA) privately designed this new framework for protecting cellular phones.

The system uses encryption to prevent fraud, scramble voice communications, and protect users' privacy. These new protections are being deployed in today's digital cell phones, including CDMA, NAMPS, and TDMA.

Not a new problem

As early as 1992, others -- including noted security expert Whitfield Diffie -- pointed out fatal flaws in the new standard's voice privacy feature. The two flaws provide a crucial lesson for policy makers and consumers, the researchers said. These weaknesses are symptomatic of broad underlying problems in the design process, according to Wagner.

Many have criticized the National Security Agency (the U.S. military intelligence agency in charge of electronically monitoring foreign powers) for insinuating itself into the design process, pressuring designers to cripple the security of the cellular encryption technique and hamstringing emerging cellular security technology. "The result is weaker protection for everybody," Kelsey said.

"This is another illustration of how U.S. government efforts to control cryptography threaten the security and privacy of Americans," said David Banisar, attorney for the Electronic Privacy Information Center in Washington, D.C.

This is not the first report of security flaws in cellular telephony. Today, most cellular phone calls can be intercepted by anyone in the area listening to a scanner, as House Speaker Newt Gingrich learned this past January when someone with a scanner recorded one of his cellular calls. According to FCC estimates, the cellular telephony industry lost more that $400 million to fraud and security problems last year.

CMEA Technology

CMEA is a symmetric cipher, like the Digital Encryption Standard (DES). It uses a 64-bit key, but weaknesses in the algorithm reduce the key to an effective length of 24 or 32 bits, significantly shorter than even the weak keys the U.S. government allows for export.

Greg Rose, program chair of the 1996 USENIX Security Symposium, put the results in context: "This break does not weaken the digital cellular fraud protections. And it's still true that digital cellular systems are much harder to casually eavesdrop on than analog phones. But it's clear from this break that a determined criminal with technical resources can intercept these systems."

Counterpane Systems is a Minneapolis, MN-based consulting firm specializing in cryptography and computer security. Bruce Schneier is president of Counterpane and author of three books on cryptography and security. David Wagner is a founding member of the ISAAC computer security research group at UC Berkeley. In the Fall of 1995, the ISAAC group made headlines by revealing a major flaw in Netscape's web browser. The authors also hasten to thank Greg Rose for his advice.

CONTACT: Counterpane Systems

Bruce Schneier, 612/823-1098

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or

University of California, Berkeley 

Robert Sanders, 510/643-6998 (PR)

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David Wagner, 510/643-9435

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or

Jump Start Communications

Lori Sinton, 415/938-2234

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