Information Security: Progress Reported, but Weaknesses at Federal Agencies Persist
Released: 2008-03-12T00:00:00

Letter

Background

Virtually all federal operations are supported by automated systems and electronic data, and agencies would find it difficult, if not impossible, to carry out their missions and account for their resources without these information assets. Therefore, it is important for agencies to safeguard their systems against risks such as loss or theft of resources (such as federal payments and collections), modification or destruction of data, and unauthorized uses of computer resources or to launch attacks on other computer systems. Sensitive information, such as taxpayer data, Social Security records, medical records, and proprietary business information could be inappropriately disclosed, browsed, or copied for improper or criminal purposes. Critical operations could be disrupted, such as those supporting national defense and emergency services or agencies’ missions could be undermined by embarrassing incidents, resulting in diminished confidence in their ability to conduct operations and fulfill their responsibilities.

Critical Systems Face Multiple Cyber Threats

Cyber threats to federal systems and critical infrastructures can be unintentional and intentional, targeted or nontargeted, and can come from a variety of sources. Unintentional threats can be caused by software upgrades or maintenance procedures that inadvertently disrupt systems. Intentional threats include both targeted and nontargeted attacks. A targeted attack is when a group or individual specifically attacks a critical infrastructure system. A nontargeted attack occurs when the intended target of the attack is uncertain, such as when a virus, worm, or malware is released on the Internet with no specific target. The Federal Bureau of Investigation has identified multiple sources of threats to our nation’s critical information systems, including foreign nation states engaged in information warfare, domestic criminals, hackers, virus writers, and disgruntled employees working within an organization. Table 1 summarizes those groups or individuals that are considered to be key sources of cyber threats to our nation’s information systems and infrastructures.

Increased Vulnerabilities Could Expose Federal Systems to Attack

As federal information systems increase their connectivity with other networks and the Internet and as the system capabilities continue to increase, federal systems will become increasingly more vulnerable. Data from the National Vulnerability Database, the U.S. government repository of standards-based vulnerability management data, showed that, as of March 6, 2008, there were about 29,000 security vulnerabilities or software defects that can be directly used by a hacker to gain access to a system or network. On average, close to 18 new vulnerabilities are added each day. Furthermore, the database revealed that more than 13,000 products contained security vulnerabilities.

These vulnerabilities become particularly significant when considering the ease of obtaining and using hacking tools, the steady advances in the sophistication and effectiveness of attack technology, and the emergence of new and more destructive attacks. Thus, protecting federal computer systems and the systems that support critical infrastructures has never been more important.

Federal Law and Policy Established Federal Information Security Requirements

FISMA sets forth a comprehensive framework for ensuring the effectiveness of security controls over information resources that support federal operations and assets. FISMA’s framework creates a cycle of risk management activities necessary for an effective security program, and these activities are similar to the principles noted in our study of the risk management activities of leading private sector organizations—assessing risk, establishing a central management focal point, implementing appropriate policies and procedures, promoting awareness, and monitoring and evaluating policy and control effectiveness. More specifically, FISMA requires the head of each agency to provide information security protections commensurate with the risk and magnitude of harm resulting from the unauthorized access, use, disclosure, disruption, modification or destruction of information and information systems used or operated by the agency or on behalf of the agency. In this regard, FISMA requires that agencies implement information security programs that, among other things, include periodic assessments of the risk; risk-based policies and procedures; subordinate plans for providing adequate information security for networks, facilities, and systems or groups of information systems, as appropriate; security awareness training for agency personnel, including contractors and other users of information systems that support the operations and assets of the agency; periodic testing and evaluation of the effectiveness of information security policies, procedures, and practices, performed with a frequency depending on risk, but no less than annually; a process for planning, implementing, evaluating, and documenting remedial action to address any deficiencies; procedures for detecting, reporting, and responding to security incidents; plans and procedures to ensure continuity of operations.

In addition, agencies must develop and maintain an inventory of major information systems that is updated at least annually and report annually to the Director of OMB and several Congressional Committees on the adequacy and effectiveness of their information security policies, procedures, and practices and compliance with the requirements of the act.

OMB and agency IGs also play key roles under FISMA. Among other responsibilities, OMB is to develop policies, principles, standards, and guidelines on information security and is required to report annually to Congress on agency compliance with the requirements of the act. OMB has provided instructions to federal agencies and their IGs for preparing annual FISMA reports. OMB’s reporting instructions focus on performance metrics related to the performance of key control activities such as developing a complete inventory of major information systems, providing security training to personnel, testing and evaluating security controls, testing contingency plans, and certifying and accrediting systems. Its yearly guidance also requires agencies to identify any physical or electronic incidents involving the loss of, or unauthorized access to, personally identifiable information.

FISMA also requires agency IGs to perform an independent evaluation of the information security programs and practices of the agency to determine the effectiveness of such programs and practices. Each evaluation is to include (1) testing of the effectiveness of information security policies, procedures, and practices of a representative subset of the agency’s information systems and (2) assessing compliance (based on the results of the testing) with FISMA requirements and related information security policies, procedures, standards, and guidelines. These required evaluations are then submitted by each agency to OMB in the form of an OMB-developed template that summarizes the results. In addition to the template submission, OMB encourages agency IGs to provide any additional narrative in an appendix to the report to the extent they provide meaningful insight into the status of the agency’s security or privacy program.

Agencies Report Progress in Performing Control Activities, but Some IGs Report that Weaknesses Exist

Major federal agencies have continued to report steady progress over the past several years in performing information security control activities, although IGs at several agencies identified inconsistencies with reported information. According to OMB and agency FISMA reports, the federal government continued to improve information security performance in fiscal year 2007 relative to key performance metrics established by OMB. For fiscal year 2007, IGs reported that more agencies had completed approximately 96-100 percent of their inventories and the governmentwide percentage of employees with significant security responsibilities who received specialized training increased. Percentages also increased for systems that had been tested and evaluated at least annually, systems with tested contingency plans, and systems that had been certified and accredited. However, agencies reported a decline in the percentage of employees and contractors who received security awareness training (see fig. 1). In addition, IGs at several agencies sometimes disagreed with the information reported by the agency and have identified weaknesses in the processes used to implement these and other security program activities.

In fiscal year 2007, 24 major federal agencies reported a total of 10,285 systems, composed of 8,933 agency and 1,352 contractor systems. Table 2 summarizes the number of agency and contractor systems by system impact level.

IGs reported that 19 agencies had completed approximately 96-100 percent of their inventories, an increase from 18 agencies in 2006. However, IGs identified problems with system inventories at several agencies. For example, three agency IGs did not agree with the reported number of agency systems or systems operated by a contractor or another organization on the agency’s behalf and one IG for a large agency reported that it did not agree with the number of agency owned systems. Additionally, one agency IG identified discrepancies in the number of system interfaces and interconnections reported and one IG reported the agency lacked procedures to ensure contractor systems are identified. Without complete and accurate inventories, agencies cannot effectively maintain and secure their systems. In addition, the performance measures used to assess agencies’ progress may not accurately reflect the extent to which these security practices have been implemented.

Security Awareness and Specialized Training

Overall, agencies reported a decline in the percentage of employees and contractors receiving security awareness training. According to agency FISMA reports, 84 percent of total employees and contractors governmentwide received security awareness training in fiscal year 2007, a decrease from 2006 in which 91 percent of employees and contractors governmentwide received security awareness training. However, 10 agencies reported increasing percentages of employees and contractors receiving security awareness training and five other agencies continue to report that 100 percent of their employees and contractors received security awareness training. In addition, each agency reported it had explained policies regarding peer-to-peer file sharing in security awareness training, ethics training, or other agencywide training.

Governmentwide, agencies reported an increasing percentage of employees with significant security responsibilities who received specialized training. In fiscal year 2007, 90 percent of these employees had received specialized training, compared with 86 percent in fiscal year 2006.

Although the majority of agencies reported improvements in both the percentage of employees and contractors receiving security awareness training and the percentage of employees with significant security responsibilities who received specialized training, several did not. For example, nine agencies reported a decrease in the percentage of employees and contractors who received security awareness training. In addition, several IGs reported weaknesses in agencies security awareness and training efforts. For example, one IG reported that the agency was unable to ensure that contractors received security awareness training and another IG reported that the agency security awareness program needs to increase employees’ awareness of social engineering techniques and the importance of protecting their usernames and passwords as a result of successful social engineering attempts. Two agency IGs also noted that weaknesses exist in ensuring that all employees who have specialized responsibilities receive specialized training. Further, eight agency IGs disagree with the percentage of individuals that their agency reported as having received security awareness training. Figure 2 shows a comparison between agency and IG reporting of the percentage of employees receiving security awareness training. Failure to provide up-to-date information security awareness training could contribute to the information security problems at agencies.

In 2007, federal agencies reported testing and evaluating security controls for 95 percent of their systems, up from 88 percent in 2006. The number of agencies that reported testing and evaluating 90 percent or more of their systems also increased from 16 in 2006 to 23 in 2007. However, IGs reported shortcomings in agency procedures for testing and evaluating security controls at several agencies. For example, 11 IGs reported that their agency did not always ensure that information systems used or operated by a contractor met the requirements of FISMA, OMB policy, NIST guidelines, national security policy, and agency policy. In addition, two IGs reported that agencies did not conduct their annual assessments using current NIST guidance. As a result, these agencies may not have reasonable assurance that controls are implemented correctly, are operating as intended, and producing the desired outcome with respect to meeting the security requirements of the agency. In addition, agencies may not be fully aware of the security control weaknesses in their systems, thereby leaving the agencies’ information and systems vulnerable to attack or compromise.

Continuity of Operations

Federal agencies reported that 86 percent of total systems had contingency plans that had been tested, an increase from 77 percent in 2006. However, as we reported in 2006, high-risk systems continue to have the smallest percentage of tested contingency plans—only 77 percent of high-risk systems had tested contingency plans. In contrast, agencies had tested contingency plans for 90 percent of moderate-risk systems, 85 percent of low-risk systems, and 91 percent of uncategorized systems (see fig. 3).

Two IGs reported that systems for their agencies were not tested in accordance with federal government requirements. Without developing and testing contingency plans, agencies have limited assurance that they will be able to recover mission-critical applications, business processes, and information in the event of an unexpected interruption.

Certification and Accreditation

Federal agencies continue to report an increasing percentage of systems that have been certified and accredited. For fiscal year 2007, 92 percent of agencies’ systems governmentwide were reported as certified and accredited, as compared with 88 percent in 2006. In addition, agencies reported certifying and accrediting 95 percent of their high-risk systems, an increase from 89 percent in 2006.

Although agencies reported increases in the overall percentage of systems certified and accredited, IGs reported that several agencies continued to experience shortcomings in the quality of their certification and accreditation process. As figure 4 depicts, five IGs rated their agencies’ certification and accreditation process as poor or failing, including three agencies that reported over 90 percent of their systems as certified and accredited.

In addition, IGs at six agencies identified specific weaknesses with key documents in the certification and accreditation process such as risk assessments, testing and evaluation, and security plans not being consistent with NIST guidance or finding those items missing from certification and accreditation packages. In other cases where systems were certified and accredited, IGs noted that contingency plans and security controls were not tested annually and security controls were not fully tested and evaluated when significant changes were made to agency systems. Additionally, one agency IG noted that the agency does not follow a formally established and documented process for certification and accreditation. As a result, reported certification and accreditation progress may not be providing an accurate reflection of the actual status of agencies’ implementation of this requirement. Furthermore, agencies may not have assurance that accredited systems have controls in place that properly protect those systems.

Policies and Procedures

Agencies had not always implemented security configuration policies. Twenty-three of the major federal agencies reported that they had an agencywide security configuration policy. Although the IGs agreed that their agency had such a policy, several IGs did not agree to the extent to which their agencies implemented the policies or applied the common security configurations as established by NIST. In addition, only seven agencies reported that they complied with NIST security configuration requirements 96 percent or more of the time. If minimally acceptable configuration requirements policies are not properly implemented to systems, agencies will not have assurance that products are configured adequately to protect those systems, which could increase their vulnerability and make them easier to compromise.

As we have previously reported, not all agencies had developed and documented policies and procedures reflecting OMB guidance on protection of personally identifiable information that is either accessed remotely or physically transported outside an agency’s secured physical perimeter. Of the 24 major agencies, 22 had developed policies requiring personally identifiable information to be encrypted on mobile computers and devices. Fifteen of the agencies had policies to use a “time-out” function for remote access and mobile devices requiring user reauthentication after 30 minutes of inactivity. Fewer agencies (11) had established policies to log computer-readable data extracts for databases holding sensitive information and erase the data within 90 days after extraction. Several agencies indicated that they were researching technical solutions to address these issues. Furthermore, four IGs reported agencies’ progress of implementing OMB guidance as poor or failing and at least 14 IGs reported weaknesses in agencies’ implementation of OMB guidance related to the protection of PII. Gaps in their policies and procedures reduce agencies’ ability to protect personally identifiable information from improper disclosure.

Security Incident Procedures

Shortcomings exist in agencies’ security incident reporting procedures. According to OMB, the number of incidents reported by agencies in their annual FISMA reports continued to fluctuate dramatically from the prior year. The majority of IGs reported that these agencies followed documented procedures for identifying and reporting incidents internally, to US-CERT, and to law enforcement. However, five IGs noted that the agency was not following procedures for internal incident reporting, two noted that their agency was not following reporting procedures to US- CERT, and one noted that the agency was not following reporting procedures to law enforcement. Several IGs also noted specific weaknesses in incident procedures such as components not reporting incidents reliably or consistently, components not keeping records of incidents, and incomplete or inaccurate incident reports. Without properly accounting for and analyzing security problems and incidents, agencies risk losing valuable information needed to prevent future exploits and understand the nature and cost of threats directed at the agency.

Remedial Actions to Address Deficiencies in Information Security Policies, Procedures, and Practices

IGs reported weaknesses in their agency’s remediation process. According to IG assessments, 10 of the 24 major agencies did not almost always incorporate information security weaknesses for all systems into their remediation plans. Twelve IGs found that vulnerabilities from reviews were not always included in remedial action plans and 10 IGs found that agencies were not always prioritizing weaknesses to help ensure they are addressed in a timely manner. Without a sound remediation process, agencies cannot be assured that information security weaknesses are efficiently and effectively corrected.

Significant Control Deficiencies at Federal Agencies Place Sensitive Information and Systems at Risk

Our work and that of IGs show that significant weaknesses continue to threaten the confidentiality, integrity, and availability of critical information and information systems used to support the operations, assets, and personnel of federal agencies. In their fiscal year 2007 performance and accountability reports, 20 of 24 major agencies indicated that inadequate information security controls were either a significant deficiency or a material weakness for financial statement reporting (see fig. 5). Our audits continue to identify similar conditions in both financial and non-financial systems, including agencywide weaknesses as well as weaknesses in critical federal systems.

Persistent weaknesses appear in five major categories of information system controls: (1) access controls, which ensure that only authorized individuals can read, alter, or delete data; (2) configuration management controls, which provide assurance that only authorized software programs are implemented; (3) segregation of duties, which reduces the risk that one individual can independently perform inappropriate actions without detection; (4) continuity of operations planning, which provides for the prevention of significant disruptions of computer-dependent operations; and (5) an agencywide information security program, which provides the framework for ensuring that risks are understood and that effective controls are selected and properly implemented. Figure 6 shows the number of major agencies with weaknesses in these five areas.

Access Controls Were Not Adequate

A basic management control objective for any organization is to protect data supporting its critical operations from unauthorized access, which could lead to improper modification, disclosure, or deletion of the data. Access controls, which are intended to prevent, limit, and detect unauthorized access to computing resources, programs, information, and facilities, can be both electronic and physical. Electronic access controls include use of passwords, access privileges, encryption, and audit logs. Physical security controls are important for protecting computer facilities and resources from espionage, sabotage, damage, and theft.

Most agencies did not implement controls to sufficiently prevent, limit, or detect access to computer networks, systems, or information. Our analysis of IG, agency, and our own reports uncovered that agencies did not have adequate controls in place to ensure that only authorized individuals could access or manipulate data on their systems and networks. To illustrate, 23 of 24 major agencies reported weaknesses in such controls. For example, agencies did not consistently (1) identify and authenticate users to prevent unauthorized access, (2) enforce the principle of least privilege to ensure that authorized access was necessary and appropriate, (3) establish sufficient boundary protection mechanisms, (4) apply encryption to protect sensitive data on networks and portable devices, and (5) log, audit, and monitor security-relevant events. Agencies also lacked effective controls to restrict physical access to information assets. We previously reported that many of the data losses occurring at federal agencies over the past few years were a result of physical thefts or improper safeguarding of systems, including laptops and other portable devices.

Weaknesses Also Existed in Other Controls

In addition to access controls, other important controls should be in place to protect the confidentiality, integrity, and availability of information. These controls include the policies, procedures, and techniques for ensuring that computer hardware and software are configured in accordance with agency policies and that software patches are installed in a timely manner; appropriately segregating incompatible duties; and establishing plans and procedures to ensure continuity of operations for systems that support the operations and assets of the agency.

However, 22 agencies did not always configure network devices and services to prevent unauthorized access and ensure system integrity, or patch key servers and workstations in a timely manner. In addition, 18 agencies did not always segregate incompatible duties to different individuals or groups so that one individual does not control all aspects of a process or transaction. Furthermore, 23 agencies did not always ensure that continuity of operations plans contained all essential information or were sufficiently tested. Weaknesses in these areas increase the risk of unauthorized use, disclosure, modification, or loss of information.

Agencywide Security Programs Were Not Fully Implemented

An underlying cause for information security weaknesses identified at federal agencies is that they have not yet fully or effectively implemented all the FISMA-required elements for an agencywide information security program. An agencywide security program, required by FISMA, provides a framework and continuing cycle of activity for assessing and managing risk, developing and implementing security policies and procedures, promoting security awareness and training, monitoring the adequacy of the entity’s computer-related controls through security tests and evaluations, and implementing remedial actions as appropriate. Our analysis determined that 21 of 24 major federal agencies had weaknesses in their agencywide information security programs. Our recent reports illustrate that agencies often did not adequately design or effectively implement policies for elements key to an information security program.

We identified weaknesses in information security program activities, such as agencies’ risk assessments, information security policies and procedures, security planning, security training, system tests and evaluations, and remedial actions. For example, One agency’s risk assessment was completed without the benefit of an inventory of all the interconnections between it and other systems. In another case, an agency had assessed and categorized system risk levels and conducted risk assessments, but did not identify many of the vulnerabilities we found and had not subsequently assessed the risks associated with them.

Agencies had developed and documented information security policies, standards, and guidelines for information security, but did not always provide specific guidance for securing critical systems or implement guidance concerning systems that processed Privacy Act-protected data.

Security plans were not always up-to-date or complete.

Agencies did not ensure all information security employees and contractors, including those who have significant information security responsibilities, received sufficient training.

Agencies had tested and evaluated information security controls, but their testing was not always comprehensive and did not identify many of the vulnerabilities we identified.

Agencies did not consistently document weaknesses or resources in remedial action plans.

As a result, agencies do not have reasonable assurance that controls are implemented correctly, operating as intended, or producing the desired outcome with respect to meeting the security requirements of the agency, and responsibilities may be unclear, misunderstood, and improperly implemented. Furthermore, agencies may not be fully aware of the security control weaknesses in their systems, thereby leaving their information and systems vulnerable to attack or compromise. Consequently, federal systems and information are at increased risk of unauthorized access to and disclosure, modification, or destruction of sensitive information, as well as inadvertent or deliberate disruption of system operations and services. In prior reports, we and the IGs have made hundreds of recommendations to agencies to address specific information security control weaknesses and program shortfalls. Until agencies effectively and fully implement agencywide information security programs, including addressing the hundreds of recommendations that we and IGs have made, federal information and information systems will not be adequately safeguarded to prevent their disruption, unauthorized use, disclosure, or modification.

Incidents at Federal Agencies Place Sensitive Information and Systems at Risk

The need for effective information security policies and practices is further illustrated by the number of security incidents experienced by federal agencies that put sensitive information at risk. Personally identifiable information about millions of Americans has been lost, stolen, or improperly disclosed, thereby potentially exposing those individuals to loss of privacy, identity theft, and financial crimes. Reported attacks and unintentional incidents involving critical infrastructure systems demonstrate that a serious attack could be devastating. Agencies have experienced a wide range of incidents involving data loss or theft, computer intrusions, and privacy breaches, underscoring the need for improved security practices.

These incidents illustrate that a broad array of federal information and critical infrastructures are at risk.

The Department of Veterans Affairs (VA) announced that computer equipment containing personally identifiable information on approximately 26.5 million veterans and active duty members of the military was stolen from the home of a VA employee. Until the equipment was recovered, veterans did not know whether their information was likely to be misused. VA sent notices to the affected individuals that explained the breach and offered advice concerning steps to reduce the risk of identity theft. The equipment was eventually recovered, and forensic analysts concluded that it was unlikely that the personal information contained therein was compromised.

The Transportation Security Administration (TSA) announced a data security incident involving approximately 100,000 archived employment records of individuals employed by the agency from January 2002 until August 2005. An external hard drive containing personnel data, such as Social Security number, date of birth, payroll information, and bank account and routing information, was discovered missing from a controlled area at the TSA Headquarters Office of Human Capital.

A contractor for the Centers for Medicare and Medicaid Services reported the theft of one of its employee’s laptop computer from his office. The computer contained personal information including names, telephone numbers, medical record numbers, and dates of birth of 49,572 Medicare beneficiaries.

The Census Bureau reported 672 missing laptops, of which 246 contained some degree of personal data. Of the missing laptops containing personal information, almost half (104) were stolen, often from employees’ vehicles, and another 113 were not returned by former employees. The Commerce Department reported that employees had not been held accountable for not returning their laptops.

The Department of State experienced a breach on its unclassified network, which daily processes about 750,000 e-mails and instant messages from more than 40,000 employees and contractors at 100 domestic and 260 overseas locations. The breach involved an e-mail containing what was thought to be an innocuous attachment. However, the e-mail contained code to exploit vulnerabilities in a well-known application for which no security patch existed. Because the vendor was unable to expedite testing and deploy a new patch, the department developed its own temporary fix to protect systems from being further exploited. In addition, the department sanitized the infected computers and servers, rebuilt them, changed all passwords, installed critical patches, and updated their anti- virus software.

In August 2006, two circulation pumps at Unit 3 of the Tennessee Valley Authority’s Browns Ferry nuclear power plant failed, forcing the unit to be shut down manually. The failure of the pumps was traced to excessive traffic on the control system network, possibly caused by the failure of another control system device.

Officials at the Department of Commerce’s Bureau of Industry and Security discovered a security breach in July 2006. In investigating this incident, officials were able to review firewall logs for an 8-month period prior to the initial detection of the incident, but were unable to clearly define the amount of time that perpetrators were inside its computers, or find any evidence to show that data was lost as a result.

The Nuclear Regulatory Commission confirmed that in January 2003, the Microsoft SQL Server worm known as “Slammer” infected a private computer network at the idled Davis-Besse nuclear power plant in Oak Harbor, Ohio, disabling a safety monitoring system for nearly 5 hours. In addition, the plant’s process computer failed, and it took about 6 hours for it to become available again.

When incidents occur, agencies are to notify the federal information security incident center—US-CERT. As shown in figure 7, the number of incidents reported by federal agencies to US-CERT has increased dramatically over the past 3 years, increasing from 3,634 incidents reported in fiscal year 2005 to 13,029 incidents in fiscal year 2007, (about a 259 percent increase).

Incidents are categorized by US-CERT in the following manner: Unauthorized access: In this category, an individual gains logical or physical access without permission to a federal agency’s network, system, application, data, or other resource.

Denial of service: An attack that successfully prevents or impairs the normal authorized functionality of networks, systems, or applications by exhausting resources. This activity includes being the victim or participating in a denial of service attack.

Malicious code: Successful installation of malicious software (e.g., virus, worm, Trojan horse, or other code-based malicious entity) that infects an operating system or application. Agencies are not required to report malicious logic that has been successfully quarantined by antivirus software.

Improper usage: A person violates acceptable computing use policies.

Scans/probes/attempted access: This category includes any activity that seeks to access or identify a federal agency computer, open ports, protocols, service, or any combination of these for later exploit. This activity does not directly result in a compromise or denial of service.

Investigation: Unconfirmed incidents that are potentially malicious or anomalous activity deemed by the reporting entity to warrant further review.

As noted in figure 8, the three most prevalent types of incidents reported to US-CERT in fiscal year 2007 were unauthorized access, improper usage, and investigation.

Opportunities Exist for Enhancing Federal Information Security

In prior reports, GAO and IGs have made hundreds of recommendations to agencies for actions necessary to resolve prior significant control deficiencies and information security program shortfalls. For example, we recommended agencies correct specific information security deficiencies related to user identification and authentication, authorization, boundary protections, cryptography, audit and monitoring and physical security. We have also recommended that agencies fully implement comprehensive, agencywide information security programs by correcting weaknesses in risk assessments, information security policies and procedures, security planning, security training, system tests and evaluations, and remedial actions. The effective implementation of these recommendations will strengthen the security posture at these agencies.

In addition, recognizing the need for common solutions to improving security, OMB and certain federal agencies have continued or launched several governmentwide initiatives that are intended to enhance information security at federal agencies. These key initiatives are discussed below.

The Information Systems Security Line of Business: The goal of this initiative is to improve the level of information systems security across government agencies and reduce costs by sharing common processes and functions for managing information systems security. Several agencies have been designated as service providers for IT security awareness training and FISMA reporting.

Federal Desktop Core Configuration: This initiative directs agencies that have Windows XP deployed and plan to upgrade to Windows Vista operating systems to adopt the security configurations developed by NIST, DOD, and DHS. The goal of this initiative is to improve information security and reduce overall IT operating costs.

SmartBUY: This program, led by GSA, is to support enterprise-level software management through the aggregate buying of commercial software governmentwide in an effort to achieve cost savings through volume discounts. The SmartBUY initiative was expanded to include commercial off-the-shelf encryption software and to permit all federal agencies to participate in the program. The initiative is to also include licenses for information assurance.

Trusted Internet Connections initiative: This is an effort designed to optimize individual agency network services into a common solution for the federal government. The initiative is to facilitate the reduction of external connections, including Internet points of presence, to a target of fifty.

In addition to these initiatives, OMB has issued several policy memorandums over the past two years to help agencies protect sensitive data. For example, it has sent memorandums to agencies to reemphasize their responsibilities under law and policy to (1) appropriately safeguard sensitive and personally identifiable information, (2) train employees on their responsibilities to protect sensitive information, and (3) report security incidents. In May 2007, OMB issued additional detailed guidelines to agencies on safeguarding against and responding to the breach of personally identifiable information, including developing and implementing a risk-based breach notification policy, reviewing and reducing current holdings of personal information, protecting federal information accessed remotely, and developing and implementing a policy outlining the rules of behavior, as well as identifying consequences and potential corrective actions for failure to follow these rules.

Opportunities also exist to enhance policies and practices related to security control testing and evaluation, FISMA reporting, and the independent annual evaluations of agency information security programs required by FISMA.

Clarify requirements for testing and evaluating security controls. Periodic testing and evaluation of information security controls is a critical element for ensuring that controls are properly designed, operating effectively, and achieving control objectives. FISMA requires that agency information security programs include the testing and evaluation of the effectiveness of information security policies, procedures, and practices, and that such tests be performed with a frequency depending on risk, but no less than annually.

We previously reported that federal agencies had not adequately designed and effectively implemented policies for periodically testing and evaluating information security controls. Agency policies often did not include important elements for performing effective testing such as how to determine the frequency, depth, and breadth of testing according to risk. In addition, the methods and practices at six test case agencies were not adequate to ensure that assessments were consistent, of similar quality, or repeatable. For example, these agencies did not define the assessment methods to be used when evaluating security controls, did not test controls as prescribed, and did not include previously reported remedial actions or weaknesses in their test plans to ensure that they had been addressed. In addition, our audits of information security controls often identify weaknesses that agency or contractor personnel who tested the controls of the same systems did not identify. Clarifying or strengthening federal policies and requirements for determining the frequency, depth, and breadth of security controls according to risk could help agencies better assess the effectiveness of the controls protecting the information and systems supporting their programs, operations, and assets.

Enhance FISMA reporting requirements. Periodic reporting of performance measures for FISMA requirements and related analyses provides valuable information on the status and progress of agency efforts to implement effective security management programs.

In previous reports, we have recommended that OMB improve FISMA reporting by clarifying reporting instructions and requesting IGs to report on the quality of additional performance metrics. OMB has taken steps to enhance its reporting instructions. For example, OMB added questions regarding incident reporting and assessments of system inventory. However, the current metrics do not measure how effectively agencies are performing various activities. Current performance measures offer limited assurance of the quality of agency processes that implement key security policies, controls, and practices. For example, agencies are required to test and evaluate the effectiveness of the controls over their systems at least once a year and to report on the number of systems undergoing such tests. However, there is no measure of the quality of agencies’ test and evaluation processes. Similarly, OMB’s reporting instructions do not address the quality of other activities such as risk categorization, security awareness training, intrusion detection and prevention, or incident reporting. OMB has recognized the need for assurance of quality for certain agency processes. For example, it specifically requested that IGs evaluate the quality of their agency’s certification and accreditation process. OMB instructed IGs to rate their agency’s certification and accreditation process using the terms “excellent,” “good,” “satisfactory,” “poor,” or “failing.” For fiscal year 2007, OMB requested that IGs identify the aspect(s) of the certification and accreditation process they included or considered in rating the quality of their agency’s process. Examples OMB included were security plan, system impact level, system test and evaluation, security control testing, incident handling, security awareness training, and security configurations (including patch management). While this information is helpful and provides insight on the scope of the rating, IGs are not requested to comment on the quality of these items. Providing information on the quality of the security-related processes used to implement key control activities would further enhance the usefulness of the annually reported data for management and oversight purposes.

As we have previously reported, OMB’s reporting guidance and performance measures did not include complete reporting on certain key FISMA-related activities. For example, FISMA requires each agency to include policies and procedures in its security program that ensure compliance with minimally acceptable system configuration requirements, as determined by the agency. In our report on patch management, we stated that maintaining up-to-date patches is key to complying with this requirement. As such, we recommended that OMB address patch management in its FISMA reporting instructions. OMB’s current reporting instructions only request that IGs comment on whether or not they considered patching as part of their agency’s certification and accreditation rating but nothing more. As a result, OMB and Congress lack information that could identify governmentwide issues regarding patch management. This information could prove useful in demonstrating whether or not agencies are taking appropriate steps for protecting their systems.

Consider conducting FISMA-mandated annual independent evaluations in accordance with audit standards or a common approach and framework. We previously reported that the annual IG FISMA evaluations lacked a common approach and that the scope and methodology of the evaluations varied across agencies.

Similar to our previous reports, we found that the IGs continue to lack a common methodology, or framework, which culminated in disparities in type of work conducted, scope, methodology, and content of the IGs’ annual independent evaluations. To illustrate: Of 24 agency IGs, seven reported performing audits that were in accordance with generally accepted government auditing standards and one cited compliance with the Quality Standards for Inspections, issued by the President’s Council on Integrity and Efficiency (PCIE). The remaining IGs did not indicate whether or not their evaluations were performed in accordance with professional standards.

One IG indicated that the evaluation focused specifically on nonfinancial systems, while others cited work conducted for financial systems as part of their evaluations. In addition, multiple IGs indicated that their reviews were focused on selected components, whereas others did not make any reference to the scope or breadth of their work.

According to their FISMA reports, certain IGs reported interviewing officials and reviewing agency documentation, such as security plans. In addition, certain IGs also conducted technical vulnerability assessments. In contrast, other IGs did not indicate their methods for evaluating controls.

The content of the information reported by IGs varied. For example, several IGs only provided a completed OMB template, while others completed the OMB template and provided reports summarizing their evaluations. Content in these reports also differed in that several included comments on whether or not their agency was in compliance with laws and regulations.

Several reports were comprised of a summary of relevant information security audits conducted during the fiscal year, while others included additional evaluations that addressed specific FISMA-required elements, such as risk assessments and remedial actions. Furthermore, some IGs issued recommendations to their agencies to improve the effectiveness of those agencies’ information security programs, while others did not indicate whether or not recommendations were issued.

These inconsistencies could hamper the efforts of the collective IG community to perform their evaluations with optimal effectiveness and efficiency. Conducting the evaluations in accordance with generally accepted government auditing standards and/or a robust commonly used framework or methodology could provide improved effectiveness, increased efficiency, quality control, and consistency in assessing whether the agency has an effective information security program. IGs may be able to use the framework and methodology to be more efficient by focusing evaluative procedures on areas of higher risk and by following an integrated approach designed to gather sufficient, competent evidence efficiently. Having a documented methodology may also offer quality control by providing a standardized methodology, which can help the IG community obtain consistency of application.

Last year we reported on efforts to develop such a framework. In September 2006, the PCIE developed a tool to assist the IG community with conducting its FISMA evaluations. The framework consists of program and system control areas that map directly to the control areas identified in NIST Special Publication 800-100 and NIST Special Publication 800-53, respectively. According to PCIE members, the framework includes broad recommendations rather than a specific methodology due to the varying levels of resources available to each agency IG. According to PCIE members, this framework is an effort to provide a common approach to completing the required evaluations, and PCIE has encouraged IGs to use it.

In summary, agencies have reported progress in implementing control activities, but persistent weaknesses in agency information security controls threaten the confidentiality, integrity, and availability of federal information and information systems, as illustrated by the increasing number of reported security incidents. Opportunities exist to improve information security at federal agencies. OMB and certain federal agencies have initiated efforts that are intended to strengthen the protection of federal information and information systems. Opportunities also exist to enhance policies and practices related to security control testing and evaluation of information security performance metrics and independent evaluations. Until such opportunities are seized and fully exploited and the hundreds of GAO and IG recommendations to mitigate information security control deficiencies and implement agencywide information security programs are fully and effectively implemented, federal information and systems will remain at undue and unnecessary risk.

Mr. Chairman, this concludes my statement. I would be happy to answer questions at this time.

Contact and Acknowledgments

If you have any questions regarding this report, please contact Gregory C. Wilshusen, Director, Information Security Issues, at (202) 512-6244 or wilshuseng@gao.gov. Other key contributors to this report include Nancy DeFranceso (Assistant Director), Larry Crosland, Neil Doherty, Rebecca LaPaze, Stephanie Lee, and Jayne Wilson.

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