By Robert Vamosi AnchorDesk

December 4, 2001 9:00 PM PT

What if every keystroke you typed was recorded? Programs that do this have existed for years, and are often traded on shadowy Web sites. Alone, they are mere curiosities, but when coupled with Trojan horses that send the data over the Internet, these so-called keystroke loggers allow malicious users to steal your passwords and credit card numbers.

Now the U.S. government wants to use similar keystroke-logging-enabled Trojan horses in the war against terrorism, and two U.S. antivirus companies have announced they'll look the other way.

SIMPLY PUT, a keystroke logging program is a memory application that records every keystroke a user makes on a given computer. Most keystroke loggers record the application name, the time and date the application was opened, and the keystrokes associated with that application. For example, when you open Outlook and write an e-mail, the keystroke logger would record your e-mail address, the subject line, and any body text you type.

Some keystroke loggers are advertised as child-protection programs, as they allow parents to see which sites their children have visited, or what their children typed during online chats. Keystroke loggers are also advertised as a means for companies to "assess" their employees' work habits. But this technology gets really pernicious when a malicious user couples it with a Trojan horse, as was the case with the recent Badtrans.B worm.

Often, keystroke loggers track what you type in popular Web browsers. Lately, though, new loggers record the passphrase you enter into encryption programs such as PGP. The passphrase is a series of words that access your encryption key. Once malicious users obtain your passphrase, they can use your encryption key, and therefore decrypt any information you have encrypted.

THE U.S. GOVERNMENT wants to use these encryption-keystroke loggers to find criminals and terrorists. In a recent and highly publicized loan shark and racketeering case in New York, FBI agents obtained information using an encryption-keystroke logger placed on computers in suspected mobster Nicodemo Scarfo's New Jersey office. According to MSNBC, agents did so by breaking into the Scarfo office and individually installing the logger on each computer. (I'll leave the question of whether or not the government should be able to "steal" encryption keys for another column.)

Code-named "Magic Lantern," the bureau's new project would essentially create a government-sanctioned Internet worm that would self-install encryption-keystroke loggers on chosen computers. Agents would still need to obtain a court order before "infecting" someone, however the U.S. Patriot Act passed in October requires authorization only from a state or U.S. attorney general at first; a judge's order isn't needed until later. One method of distributing the encryption-keystroke loggers involves having a friend or relative of the person under investigation send him or her an infected e-mail. Of course, this could only happen if the suspect's antivirus program didn't first detect the FBI's Trojan horse.

SO FAR, Symantec has said its software will not detect the presence of this FBI Trojan horse. According to the Associated Press's Ted Bridis, a source at Network Associates told him the company had contacted the FBI to say it would not detect Magic Lantern. This statement was vehemently denied by Michael Callahan, director of marketing at McAfee (part of Network Associates). It should be noted that antivirus products already exclude some files from their scans, though none are as powerful as Magic Lantern. No antivirus software vendors outside the U.S have weighed in on this matter yet.

Shane Coursen, a SecurityFocus columnist and CEO of WildList Organization International, a group that tracks viruses in the wild, predicts that any such collusion with the FBI might begin the downfall of U.S. antivirus software maker's dominance worldwide. I think the real danger lurks in the FBI borrowing a page from a malicious user's notebook. Even if every antivirus vendor in the world agreed to exclude the FBI's Trojan, the shadow Web sites already used by malicious users would start hosting custom Magic Lantern detection programs. Once such a tool is available, the FBI's magic would be useless.

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-- Pammy (pamela_sue57@hotmail.com), December 06, 2001