Hacker steals 17 million Zomato users’ data, briefly puts it on dark web

The article by Kim Arora and Digbijay Mishra with inputs from Ranjani Ayyar in Chenna was published in the Times of India on May 19, 2017. Pranesh Prakash was quoted.

According to information security blog and news website HackRead, the data was being peddled online on the "dark web" for about $1,000. The company, also a food delivery platform, advised users to change passwords. However, late on Thursday night, Zomato claimed it had contacted the hacker and persuaded him/her to not only destroy all copies of the data, but also to take the database off the dark web marketplace. The company said it will post an update on how the breach happened once they "close the loopholes".

In an official blog updated with this information, Zomato said, "The hacker has been very cooperative with us. He/she wanted us to acknowledge security vulnerabilities in our system and work with the ethical hacker community to plug the gaps. His/her key request was that we run a healthy bug bounty program for security researchers." Bug bounties are a standard program among tech companies, where they reward outsiders to highlight bugs and flaws in their software systems.

The number of user accounts compromised was pegged at 17 million earlier in the day. In the late night update, Zomato said password hashes (passwords in a scrambled, encrypted form) of 6.6 million users was compromised. It wasn't immediately clear whether this 6.6 million was part of the 17 million records stolen.

Zomato tried assuring users that payment information was safe. "Please note that only 5 data points were exposed - user IDs, names, usernames, email addresses, and password hashes with salt- that is, passwords that were encrypted and would be unintelligible. No other information was exposed to anyone (we have a copy of the 'leaked' database with us). Your payment information is absolutely safe, and there's no need to panic," said the late night update.

However, the information security community raised concerns over the technique used for "hashing" or encrypting the passwords. A screenshot of the vendor's sale page for stolen data posted on HackRead identifies the hashing algorithm as "MD5", which experts say is "outdated" and "insecure". The research team at infySEC -- a cyber security company from Chennai -- tried to access user information in Zomato's database, as part of its bug bounty program. "We were able to access user names, email IDs, addresses and history of transactions. We highlighted this to Zomato but we have not heard from them," said Karthick Vigneshwar, director, infySEC.

Zomato joins a long list of tech-enabled businesses that have recently had user data stolen. Such data can ostensibly be used by malicious actors to send phishing mails, or even by hackers to carry out cyber attacks. In February 2017, content delivery network CloudFlare's customer data was leaked. The data leaked had not just password hashes, but even customers' IP addresses and private messages. In June 2015, online password management service LastPass was hacked and had its data leaked online.

"We hash passwords with a one-way hashing algorithm, with multiple hashing iterations and individual salt per password. This means your password cannot be easily converted back to plain text. We, however, strongly advise you to change your password for any other services where you are using the same password," Zomato's chief technology officer Gunjan Patidar said in the blog which was updated twice through the day. Affected users have been logged out of the website and the app.

Password "hashing" is an encryption technique usually used for large online user databases. The strength of the encryption depends on the algorithm employed to do the same. "Salting" is the addition of a string of characters to the passwords when stored on such a database, which adds another layer of difficulty in cracking them.

In an email to TOI, a company spokesperson said, "Over the next couple of days, we'll be actively working to improve our security systems — we'll be further enhancing security measures for all user information stored within our database, and will also add a layer of authorisation for internal teams having access to this data to avoid any human breach."

HackRead, a security blog and news website, found the stolen Zomato database of 17 million users for sale on what is called the "dark web". This can be described as a portion of the content available on the World Wide Web, away from the public internet. This content is not indexed on search engines like Google, and can only be accessed using software that can route around the public internet to get there.

According to the screenshots of the sale posted on HackRead, the Zomato database used a hashing technique called "MD5", which security experts say is inappropriate for encrypting passwords. "If MD5 was used, it shows bad security practices were in place. It isn't industry standard to use this algorithm for password hashing. Algorithms like bcrypt, scrypt, are more secure," says Pranesh Prakash, policy director at Bengaluru's Centre for Internet and Society.

What if a user does not use an exclusive Zomato account to sign into the service, but signs in through a Google or Facebook account? "In that case, just to be safe, you can delink your Zomato from the account you use to sign in, although your password will not be at risk," says Prakash. Zomato says, 60% of its users use such third party authorisation, and they are at "zero risk."

Would Zomato be liable to compensate end users for loss of sensitive data? Supreme Court advocate Pavan Duggal says, "Such players, referred to as intermediaries under the IT Act hold sensitive data and are expected to have reasonable security protocols in place. Should an end user face any loss/damage due to a data breach, they can sue Zomato and seek compensation." While most players have end user agreements and disclaimers in place, Duggal adds that the IT Act will prevail over any other law or contract to the extent it is inconsistent.