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From: Ry Jones (rjonesairgap.net)
Date: Wed May 08 2002 - 14:34:11 CDT

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    NTFS and PGP interact to expose EFS encrypted data
    © 2002 Ry Jones, Airgap Networks.

    NTFS, a feature of Windows XP, supports an "encrypted" attribute. PGP
    7.0.3 Freeware, a product of Network Associates, supports wiping
    files as they are deleted. If you enable file wiping and then set the
    "encrypted" attribute on a folder, copies of the contents are left
    un-encrypted on the file system.

    As explorer works it's way through the file system encrypting the
    contents, it first renames the source file to a name in the format of
    "EFSn.TMP" where n is an increasing series of integers starting at 0.
    It then encrypts the file into a target file with the same name as
    the original. The permissions on the temp file are set to a very
    restrictive level; the temp file is then deleted. However, if you
    have set PGP to wipe deleted files, it appears PGP intercepts the
    deletion of the file. PGP, running as the user, has insufficient
    privilege to delete the file, and leaves the temp file in place.

    Anyone who recovers the hard drive can take ownership of these temp
    files and read them. Also, in the default setting, hidden files are
    not shown in explorer, so a user may not be aware that the temp files
    exist at all. Any administrator may take ownership of the temp files
    and read the data.

    1: create a directory "efs-pgp-interaction-bug". Copy a text file
    into the directory.
    2: right click on the PGP icon. Set the "Automatically wipe on
    delete" flag. Click OK.
    3: right click on the "efs-pgp-interaction-bug" directory in
    explorer. Click properties, advanced, and check the "Encrypt contents
    to secure data" flag. Click OK, OK.
    4: double click on efs-pgp-interaction-bug. If you have set the "show
    hidden files and folders" flag (tools, folder options, view, show
    hidden files and folders, OK) you well see the EFSn.TMP files.
    Attempting to open the temp files will result in an error (depending
    on application). Vim reports "[Permission Denied]".
    5: hit the backspace key. Right click on the efs-pgp-interaction-bug
    directory. Select sharing and security; select security, advanced.
    Check the "replace permission entries on all child objects…" check
    box and click OK. Click "Yes", "OK".
    6: Re-open efs-pgp-interaction-bug and right click on the temp file
    (EFS0.TMP). Select Open With, Notepad. View your file.

    Do not enable PGP's Wipe Deleted Files option if you are using
    Encrypted NTFS.

    Vendor Response:

    This issue has been resolved, and a hot fix for PGP Desktop Security
    v7.0.x, PGP Corporate Desktop v7.1.x and PGPfreeware v7.0.x (all for
    Windows 2000) is available at

    Users should be aware that Win2K EFS does NOT wipe the contents of
    files that are encrypted according to the steps above. The PGP Wipe
    Free Space feature to ensure that the clear text has been wiped.

    Discovered: 10 MAR 2002
    Sent to vendors: 17 MAR 2002
    Submitted to NTBugtraq, Bugtraq: 08 MAY 2002

    Thanks to: Russ of NTBugtraq for driving the issue with Microsoft and
    NAI much more effectively than I ever would have. There never would
    have been a resolution without his efforts.

    Version: PGP 7.0.4

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