In the first quarter of this year, McAfee Labs found 8,000 samples of mobile malware. The same time last year, this number was in the hundreds.

"A burglar cannot rob 300 homes in one night, but a cybercriminal can attack 300 mobile devices at a time," pointed out Dr. Markus Jakobsson, principal scientist, consumer security at PayPal, at the Mobile Banking and Commerce Summit in San Francisco last month. Not only are hackers more active and aggressive than ever, but consumers tend to be naive and trusting about applications on their mobile devices. "Consumers are oblivious to the threat of malware on smartphones," he says.

"People have gotten rid of their fear of downloading executables," despite many having such fears in the early days of the Internet, Jakobsson says. "People will install anything on a phone and do anything their friends suggest," he says. For companies, traditional means of fighting mobile malware, such as server-side filters and signature-based detection, are no longer good enough, he says. Behavioral detection, in which customer behavior is closely watched for signs something is awry, will be the more effective mechanism in the future.

"I think the biggest threat we'll see down the road is a growing up in the sophistication of attacks against mobile devices," concurs Andrew Hoog, chief investigative officer of viaForensics, a security firm that tests mobile applications for government agencies and companies for vulnerability to malware. "As mobile devices combine more personal and enterprise data, they become a more lucrative target. They're constantly connected to the internet and they're updated a lot. Mobile has all the information cybercriminals are looking for in one spot."

Apple's mobile operating system, iOS, has some fundamental weaknesses, Hoog says. "What we always say about iOS is it's a monoculture," he says. "In the Android world, you can slice and dice things different ways. Because Apple controls their environment strictly, when you find a vulnerability in the iOS space, once you've got it, you've got it everywhere."

viaForensics has posted a paper providing 42 tips for improving mobile application security. The first tip is, "Avoid storing sensitive data on the device"; the second is, "avoid caching app data on the device." These are mistakes for which the security firm has "failed" applications in the past. The best practices are all directed at developers, to help them create safer programs.

Some of the suggestions seem to run counter to newer things banks want to do with mobile banking. For example, tip 18, "use geolocation carefully," could seem at odds with some of the specific location-based mobile coupons and reward programs banks such as U.S. Bank are piloting - knowing that, say, the customer is in the paint department of Home Depot, that customer might be sent an offer for 30% off Sherwin Williams paint.

"Our point is not, 'don't use it,'" Hoog says. "Use it, but at the granularity you need." For instance, a bank might want to know the customer's phone is in Chicago for fraud detection purposes, but might not need the specific street address. And geolocation data doesn't necessarily need to be saved, on the phone or anywhere. "Geolocation is valuable to the consumer and to the bank in a very specific time and instance, but there's no value to saving that information on the phone itself," Hoog says.

"That's where we see a lot of people making mistakes," he says. "It's one thing to say I give you permission to find out if I'm in Home Depot, But don't save where I was when and store it on my phone. If you really need to save it, tell the consumer and save it on your server in a secure fashion."

viaForensics' main point is that developers have to write secure code for mobile apps. "They're not writing secure code today, that's why we have different issues," Hoog says.

For related coverage see Bank Technology News

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