Hackers Find a New Way to Cheat On Wall Street

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Source: InfoWorld — Jan 5, 2011

High-frequency trading networks, which complete stock market transactions in microseconds, are vulnerable to “side-channel” manipulation by hackers who can inject tiny amounts of latency into them. By doing so, they can subtly change the course of trading and pocket profits of millions of dollars in just a few seconds, says Rony Kay, a former IBM research fellow and founder of cPacket Networks.

He says the root of the problem is the increasing speed of networks; as they get faster and faster, our ability to actually understand events taking place within them isn’t keeping up. Network monitoring technology can detect perturbations in network traffic happening in milliseconds, but when changes occur in microseconds, they’re not visible, he says.

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Topics: Internet/Telecom | Survival/Defense

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