Why?  Cause I can selll it for $25k.  No...scroll down further ...I can sell it for $32k.  Of course if you hooked up our device to your phone, and swiped your card and entered your PIN (ONE TIME) that phone would be a secure payment terminal.  I've gotten a few emails regarding hooking up our device to a mobile phone and wanted to clarify.  You would only need to swipe and enter your PIN "one-tiime" to morph your phone into a secure payment device.  Not everytime you wanted to purchase something.  I'll have more on this in future posts, but in the meantime, if you've got a Nokia 1100 let me know!

Complete item: http://www.theregister.co.uk/2009/04/21/nokia_1100_scam/

Description:
Scammers are reportedly prepared to pay $25,000 for German Nokia 1100 handsets, on the basis that they can be reprogrammed to intercept SMS messages and thus crack banking security.

The claim comes from Ultrascan, a security association that generally follows up 419 scams and ID theft. Ultrascan tells us it was approached by Dutch police concerned that the price of a second-hand Nokia 1100 was unexpectedly rising. The company subsequently discovered that buyers were interested in a security flaw that makes the German version of the handset worth so much, though the technical background remains obscure.

The supposed exploit is based around codes - mTAN - that are sent to customers over SMS and are unique to each mobile-banking transaction. The premise is that criminals have "thousands" of login details and just lack these single-use codes, so are trying to get hold of Nokia 1100 handsets to intercept them.

The problem with this hypothsis is that the GSM security model is managed by the SIM, which colludes with the network's authentication server to create an encryption key which is made available to the handset. Communications can only be intercepted by getting hold of that key, or breaking the encryption itself, neither of which is easier to do while in position of a Nokia 1100, German or otherwise.

We put these technical issues to Ultrascan who told us that they "did not investigate [the technical] part", but are hoping to get hold of a '1100 for testing in the next few days to see what is possible.

In the early days of GSM some operators introduced a critical flaw (zeros) into early versions of GSM cryptography, to enable the use of cheaper SIMs, but almost all operators have since upgraded to proper security and 3G networks have open algorithms that are well known to be pretty secure. Some countries, such as Pakistan, aren't permitted to use cryptography so still suffer from SIM-cloning and the like, but such places don't generally offer mobile banking for obvious reasons.

Ultrascan say they'll be in touch when they have more technical details, but for the moment it's beyond us how one phone can intercept calls made to a different SIM, and it seems more likely that one scammer is simply ripping off another with promises of magic handsets.


Complete item: http://www.computerworld.com/action/article.do?command=viewArticleBasic&articleId=9131906&source=NLT_SEC

Description:
The mystery why cybercriminals want a discontinued Nokia phone isn't getting any clearer. Hackers have been offering up to $32,413 in underground forums for Nokia 1100 phones made in the company's former factory in Bochum, Germany. The phone can allegedly be hacked so as to facilitate illegal online banking transfers, according to the Dutch company Ultrascan Advanced Global Investigations.

Nokia said on Tuesday it is not aware that resale prices for a phone that retailed for less than $17 when it debuted in 2003 have risen so high. Further, Nokia maintains the phone's software isn't flawed.

"We have not identified any phone software problem that would allow alleged use cases," the company said in an e-mailed statement.

The 1100 can apparently be reprogrammed to use someone else's phone number, which would also let the device receive text messages. That capability opens up an opportunity for online banking fraud.

In countries such as Germany, banks send an mTAN (mobile Transaction Authentication Number) to a person's mobile phone that must be entered into a Web-based form in order to, for example, transfer money into another account. A TAN can only be used once, a security feature known as a one-time passcode.

Criminals have proven adept at obtaining people's usernames and log-ins for online bank accounts, either through tricking people into visiting look-alike bank Web sites, through clever e-mail messages or simply hacking PCs.

European banks typically issue customers a list of TANs, but phishers tricked people into revealing those. Deutsche Postbank used to accept any TAN from the list to complete a transaction. Then the bank moved to requesting specific TANs from the list. After continuing fraud, it decided in 2005 to expanded the use of mTANs.

"The mTAN is valid only for the requested transfer and only for a short period," according to the bank's Web site. "It thus has no value for a fraudster."

That is, unless the hacker could also receive the mTAN, which Nokia 1100 hack allegedly allows.

Nokia said it doesn't know of an 1100 software problem that would allow call spoofing. The company said that a phone's SIM (Subscriber Identity Module) card -- which holds the device's phone number -- has security mechanisms that are separate from the phone itself.

Nokia said it is aware of commercial services that claim to provide caller identification or phone-number spoofing services, but in those cases the service provider acts as a proxy between the caller and the recipient, Nokia said.

But it is possible to have multiple phones running on a service provider's network that use the same phone number, said Sean Sullivan, a security adviser at F-Secure Corp., a security vendor in Helsinki, Finland. Usually, the last phone that used the network will be the one that receives inbound messages, he said.