Menu
The FTC's IoT security case against D-Link will test its power

The FTC's IoT security case against D-Link will test its power

The agency faces a hard fight in its suit alleging D-Link's routers and cameras aren't secure

A Federal Trade Commission attempt to rein in a poorly secured IoT device is raising questions over whether the U.S. regulator has the power to crack down on vendors suspected of shoddy practices.

On Thursday, the FTC filed a complaint against Taiwanese manufacturer D-Link Systems that charged the company’s internet routers and web cameras can easily be hacked, putting consumers at risk.

But the FTC’s complaint doesn’t cite evidence that the products have been breached, only the potential for harm to consumers.

That’s among the reasons D-Link is contesting the complaint. “Notably, the complaint does not allege any breach of a D-Link Systems device,” it said in a statement

"Instead, the FTC speculates that consumers were placed 'at risk' to be hacked, but fails to allege, as it must, that actual consumers suffered," the company said. 

No harm, no foul? That’ll be a key question as a federal court examines the case, said Jeremy Goldman, a partner at law firm Frankfurt Kurnit Klein & Selz who specializes in digital law.

“This usually doesn’t happen. Most of the time, there is a settlement made with the FTC,” he said. “But with D-Link fighting back, there is a real question over the scope of the FTC’s power.”

The action comes as cybersecurity experts warn of the dangers posed by poorly secured internet-connected devices. Hackers can easily take them over to steal a consumer’s data or infect them to form botnets that can be used to take down websites.

The FTC said on Thursday it was very aware of the potential dangers, and so decided to sue D-Link, an alleged offender that produces wireless routers, web cameras and other products.

The FTC alleges D-Link’s promotional materials deceived consumers into thinking the products were secure, when they actually contained vulnerabilities. But no U.S. law defines what constitutes a secure router or web camera.

The FTC's approach is problematic, said Robert Graham, CEO of security firm Errata Security. 

“You can’t really hold people accountable, when no one knows what the law is doing,” he said. 

Under the FTC’s logic, any company, from D-Link to Microsoft to Cisco Systems, could be sued for promising security in their products but failing to address vulnerabilities, he said.

"Perfect security is impossible," Graham said. "The FTC is just applying arbitrary standards.”

The FTC has been taking an aggressive stance in promoting better security standards under the Obama administration, said Goldman at Frankfurt Kurnit Klein & Selz. The complaint against D-Link a warning shot at the IoT industry, he said.

“Right now there are no U.S. laws that set the minimum level of security for these devices,” he said. “So the FTC is trying to fill those gaps in the name of protecting consumers.”

But the commission still might face legal difficulties in holding D-Link accountable for its products. 

"You have to show probability of harm," he said. "That's where the battle is going to be."


Follow Us

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Featured

Slideshows

The making of an MSSP: a blueprint for growth in NZ

The making of an MSSP: a blueprint for growth in NZ

Partners are actively building out security practices and services to match, yet remain challenged by a lack of guidance in the market. This exclusive Reseller News Roundtable - in association with Sophos - assessed the making of an MSSP, outlining the blueprint for growth and how partners can differentiate in New Zealand.

The making of an MSSP: a blueprint for growth in NZ
Reseller News Platinum Club celebrates leading partners in 2018

Reseller News Platinum Club celebrates leading partners in 2018

The leading players of the New Zealand channel came together to celebrate a year of achievement at the inaugural Reseller News Platinum Club lunch in Auckland. Following the Reseller News Innovation Awards, Platinum Club provides a platform to showcase the top performing partners and start-ups of the past 12 months, with more than ​​50 organisations in the spotlight.​​​

Reseller News Platinum Club celebrates leading partners in 2018
Meet the top performing HP partners in NZ

Meet the top performing HP partners in NZ

HP has honoured its leading partners in New Zealand during 2018, following 12 months of growth through the local channel. Unveiled during the fourth running of the ceremony in Auckland, the awards recognise and celebrate excellence, growth, consistency and engagement of standout Kiwi partners.

Meet the top performing HP partners in NZ
Show Comments