Ubiquiti Massively Downplayed a ‘Catastrophic’ Security Breach To Minimize Impact On Stock Price, Alleges Whistleblower

In January, Ubiquiti Networks sent out a notification to its customers informing them of a security breach and asking all users to change their account passwords and turn on two-factor authentication. “We recently became aware of unauthorized access to certain of our information technology systems hosted by a third party cloud provider,” Ubiquiti said at the time. Now, according to Krebs on Security, a whistleblower “alleges Ubiquiti massively downplayed a ‘catastrophic’ incident to minimize the hit to its stock price, and that the third-party cloud provider claim was a fabrication.” From the report: “It was catastrophically worse than reported, and legal silenced and overruled efforts to decisively protect customers,” [the source] wrote in a letter to the European Data Protection Supervisor. “The breach was massive, customer data was at risk, access to customers’ devices deployed in corporations and homes around the world was at risk.”

According to [the source], the hackers obtained full read/write access to Ubiquiti databases at Amazon Web Services (AWS), which was the alleged “third party” involved in the breach. Ubiquiti’s breach disclosure, he wrote, was “downplayed and purposefully written to imply that a 3rd party cloud vendor was at risk and that Ubiquiti was merely a casualty of that, instead of the target of the attack.” In reality, [the source] said, the attackers had gained administrative access to Ubiquiti’s servers at Amazon’s cloud service, which secures the underlying server hardware and software but requires the cloud tenant (client) to secure access to any data stored there. “They were able to get cryptographic secrets for single sign-on cookies and remote access, full source code control contents, and signing keys exfiltration,” [the source] said.

[The source] says the attacker(s) had access to privileged credentials that were previously stored in the LastPass account of a Ubiquiti IT employee, and gained root administrator access to all Ubiquiti AWS accounts, including all S3 data buckets, all application logs, all databases, all user database credentials, and secrets required to forge single sign-on (SSO) cookies. Such access could have allowed the intruders to remotely authenticate to countless Ubiquiti cloud-based devices around the world. According to its website, Ubiquiti has shipped more than 85 million devices that play a key role in networking infrastructure in over 200 countries and territories worldwide.

Instead of asking customers to change their passwords when they next log on, [the source] says Ubiquiti should’ve immediately invalidated all of its customer’s credentials and forced a reset on all accounts, mainly because the intruders already had credentials needed to remotely access customer IoT systems.