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Here are the answers to the questions in 4: 1. What is the most important aspect of performing an evaluation of information security controls on a process or system A. Ensuring that the best practice control techniques are being utilized properly B. Understanding the businesses functional requirements of the process to ensure that they can be accomplished C. Ensuring that the deployed controls work as part of the overall security architecture program D. Making sure that access is strictly controlled based on a need to know Answer: B The correct answer is B. Best practice control techniques properly utilized (A) will need to be applied relative to the business needs, and they cannot be deployed without considering the goals of the business and the security control parameters that the business process places on the system. It also is important to ensure that the security controls used work well together and compliment other controls used in the architecture providing defense in depth (C), but not without first considering the business goals to ensure the business needs are met. Restricting access based on a need to know (D) also is an important concept and will be a secondary step to ensuring access control that will follow from first understanding the business needs. Those needs define the need to know for the system s users.

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A tip for this category is that when you buy in wholesale lots on eBay and then resell on eBay, buy with your user ID hidden. Many of the wholesale lot sellers hold what s called a private auction. They do this so that your user ID is not shown as the winning bidder. It will say for the winning buyer: User ID kept private. This keeps you anonymous, so that no one can find out how much you make when you break these items out into separate auctions. The Apple iPod auction was a private auction, so I couldn t search by the user s ID to see how much he sold each of those items for and how much he made.

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As subprime mortgages began to default in 2007, the credit-rating agencies unleashed a ood of credit downgrades for MBS backed by subprime mortgages According to the SEC:24 As of February 2008, Moody s had downgraded at least one tranche of 942 percent of the subprime MBS issues it rated in 2006, and 769 percent of subprime MBS issues it rated in 2007 As of March 2008, S&P had downgraded 443 percent of the subprime tranches it rated between the rst quarter of 2005 and the third quarter of 2007 As of December 2007, Fitch had downgraded 34 percent of the subprime tranches it rated in 2006 and in the rst quarter of 2007 This torrent of downgrades precipitated a major government review of the credit-rating agencies.

Figure 5.29 Time reversal and subsequent time shift of f(t ).

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As one Moody s executive said in an internal memo about these downgrades: These errors make us look either incompetent at credit analysis, or like we sold our soul to the devil for revenue 25 The agencies face a fundamental con ict of interest because they are paid by the MBS issuers, but their ratings are supposed to help investors decide whether to buy these same MBS If an issuer begins discussions with one rating agency that appears to be leaning against a top rating, the issuer can simply take its business to another agency As Dean Baker, an economist, explained: The agencies want to get hired, and they re well aware of the fact that if they re not giving acceptable ratings, they may not be called back.

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26 This con ict of interest is especially acute when one arm of the credit-rating agency is hired to structure a complex deal, and another arm is later paid to rate the deal How likely is the agency to withhold a top rating if the issuer designs the deal according to the advice given by the same agency s consulting arm By contrast, accounting rms are prohibited by the Sarbanes-Oxley Act from providing most consulting services to a company for whom they serve as its auditor..

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