Security Enforcement Research Articles

A Security Awareness and Protection System for 5G Smart Healthcare Based on Zero-Trust Architecture.

The key features of 5G network (i.e., high bandwidth, low latency, and high concurrency) along with the capability of supporting big data platforms with high mobility make it valuable in coping with emerging medical needs, such as COVID-19 and future healthcare challenges. However, enforcing the security aspect of a 5G-based smart healthcare system that hosts critical data and services is becoming more urgent and critical. Passive security mechanisms (e.g., data encryption and isolation) used in legacy medical platforms cannot provide sufficient protection for a healthcare system that is deployed in a distributed manner and fail to meet the need for data/service sharing across “cloud-edge-terminal” in the 5G era. In this article, we propose a security awareness and protection system that leverages zero-trust architecture for a 5G-based smart medical platform. Driven by the four key dimensions of 5G smart healthcare including “subject” (i.e., users, terminals, and applications), “object” (i.e., data, platforms, and services), “behavior,” and “environment,” our system constructs trustable dynamic access control models and achieves real-time network security situational awareness, continuous identity authentication, analysis of access behavior, and fine-grained access control. The proposed security system is implemented and tested thoroughly at industrial-grade, which proves that it satisfies the needs of active defense and end-to-end security enforcement of data, users, and services involved in a 5G-based smart medical system.

Rules-Based Accounting Standards and SEC Enforcement

This archival study investigates the association between rules-based violations and the likelihood of SEC enforcement. I utilize two samples of firms subject to SEC investigations: 1) firms with investigations that end in an enforcement action and 2) firms with investigations that are dropped, and examine the impact of rules-based accounting violations on enforcement. Each enforcement action in the sample specifically cites the GAAP standard violated, and the degree to which the standards contain rules-based characteristics is quantified. The violations are classified as either rules-based or principles-based and a multivariate analysis is performed. The “roadmap” theory suggests that firms who commit rules-based violations are more likely to be subject to SEC enforcement, while the “roadblock” theory predicts the opposite effect.
 Overall, the results suggest the SEC is less likely to litigate cases that involve rules-based accounting violations, or more likely to drop/dismiss investigations centered on rules-based violations, consistent with the “roadblock” theory. No evidence is found of a relation between rules-based accounting violations and the dollar magnitude of penalties assessed. These results are relevant for financial statement preparers, auditors, and regulators.

A security policy model transformation and verification approach for software defined networking

Software-defined networking (SDN) has been increasingly utilized to enforce the security of complex networks. However SDN-based security enforcement mechanisms rely heavily on some specific security policies containing underlying network information. Facing the increasingly complex and huge SDN networks, we urgently need a novel security policy management mechanism which can be completely transparent to any underlying network information. That is it can permit network managers to define the high-level security policy model without containing any underlying information, and by means of model transformation, high-level security policy model can be automatically transformed into its corresponding lower-level security policy model containing underlying information. Moreover, we must ensure the system model of data plane updated by the low-level security policy model can hold all of security properties defined in high-level security policy model. Based on these insights, we propose a security policy model transformation and verification approach for SDN in this paper. We first specify the security policies used in SDN networks as a formal security policy model (SPM). Then we establish the system model of SDN’s data plane and the mapping rules between the policy objects of SPM and the system objects of system model of data plane. Based on these mapping rules, we propose a security policy model transformation mechanism which transforms SPM into the low-level security policy model, RSPM. In order to verify the system model of data plane updated by RSPM can hold all of security properties defined in SPM, we propose a security policy verification mechanism based on model checking techniques and a group of validation conditions. Finally, we utilize a comprehensive case to illustrate the feasibility of this approach.

Challenges and Countermeasures of Network Security Law Enforcement

With the rapid development of the Internet, there are more and more illegal crimes on the Internet. In order to comply with the development of the times and meet the challenge of law enforcement, the requirements for the enforcement of network security enforcement are increasingly urgent. This article first elaborates the connotation and characteristics of network security law enforcement. Secondly, it analyzes the challenges faced by current network law enforcement. Finally, it points out the strategies for enforcing network security law enforcement.

Enhanced dynamic team access control for collaborative Internet of Things using context

SummaryThe development of the Internet of Things (IoT) aims to overcome security issues especially in critical areas that require integrity, confidentiality and a high level of privacy of the data. Among security challenges, the access control model should be well defined and adapted to the characteristics and security requirements of IoT applications. The work presented here proposes big enforcement of security for dynamic team access control using context information in order to provide granular and secure authorizations with different access control levels related to collaborative IoT. The enhanced dynamic team access control (EDTMAC) model introduces a formal theoretical model which relies on the top of the role‐based access control model. The use of different context information with a global context information security policy and security rules raised the model strength against unauthorized access and avoided security breaches such as the leak of information by providing the least privileges for the users. The result of EDTMAC analysis shows that the model is well adapted to IoT dynamic nature and collaborative IoT activities for teams. Moreover, the model is flexible and scalable, user‐driven, reliable, and secure against unauthorized access requests. The developed model supports the well‐known least‐privilege principle and separation of duties for the team members. In addition, it allows easy management of the teams, provides fine‐grained access control authorizations and supports delegation.

On the SEC's 2010 enforcement cooperation program

This study examines changes in SEC enforcement and firm cooperation after the SEC introduced its new cooperation program in 2010. While previous research shows that the SEC penalized cooperative firms prior to 2010, our results suggest that after that year, it rewarded cooperation, especially good faith actions. We also find that after 2010, the SEC increased mentions of cooperation in public speeches and publicized more details about firm cooperative activities in AAERs. Finally, we find some evidence that misconduct firms increased good faith cooperation after the SEC revised its cooperation program in 2010. Our findings suggest that having a more explicit leniency program improves its effectiveness.

Responding to Activist Short Sellers: Allegations, Firm Disclosure Choices, and Outcomes

This study provides descriptive evidence on how firms respond to activist short seller reports and how these responses are associated with outcomes for the targeted firms. We show that the frequency of these reports has grown substantially in recent years. Although we find that firms respond only 31% of the time, this rate increases substantially when the report is accompanied by significantly negative abnormal returns and when the report contains new evidence. Not responding is associated with a less negative stock price response at report release and fewer adverse outcomes. Firms that launch internal investigations following the report release have significantly higher subsequent rates of stock exchange delisting and SEC enforcement actions, and lower rates of being acquired. Overall, our results highlight the impact of activist short sellers on target firms and that firm responses are associated with material outcomes.

Does financial reporting misconduct pay off even when discovered?

Experts and popular belief contend that it pays to engage in financial misconduct. We hand-collect data on three subsamples of severe misconduct cases, between 2003 and 2016: a sample of 37 (100) SEC enforcement actions (class action lawsuits) that explicitly allege fraud and a sample of 100 restatements with the most negative stock price reaction in which investors presumably suspect fraud. We then compare estimates of the benefits from reporting misconduct to top managers against estimates of the costs of its discovery. We find that 32.9% of perpetrators experience an overall net benefit from discovered misconduct. The percentage of officers who benefit is highest for the restatement subsample (43.5%), followed by the class action lawsuit subsample (27.7%), and is the lowest for the SEC enforcement subsample (8.1%). Stated differently, if we assume that the probability of detection is 31%, as conjectured in the literature, more than half of the perpetrators in our sample would benefit from engaging in financial reporting misconduct. Hence our evidence suggests that financial reporting misconduct can pay off for perpetrators.

Australian biometric system to meet national security objectives – Part II legislation and policy

ABSTRACT Biometric technical capabilities enable the collection, storage, transmission, sharing, matching, and analysis of biometrics to enable decision making and actioning in support of national security objectives. United Nations Security Council Resolution (UNSCR) 2396 (2017) and UNSCR 2322 (2016) calls upon member states to investigate foreign terrorist fighters and share biometrics and contextual information, which requires a close alignment between military operations, border security, and law enforcement investigations. A system of systems design of biometrics technical capabilities allows for closer alignment between relevant entities to support national security objectives. However, this alone is not sufficient and there is a need for legislation and organizational policy to enable national and international biometrics collection, storage, transmission, sharing, matching, analysis and actioning. This paper discusses the complex Australian legislative and policy considerations to enable the biometric system to support the criminal justice, law enforcement, military and intelligence systems to meet national security objectives. Sharing of biometrics data and contextual information to meet national security objectives need to be balanced with privacy concerns and civil liberty.

A Research Paper of Security Enforcement Policy for (SDN) (WLAN) Software Defined Network

A Research Paper of Security Enforcement Policy for (SDN) (WLAN) Software Defined Network

What Remains of Kokesh After Liu?

This paper addresses two questions that emerge from Liu v. SEC, 2020 WL 3405845 (U.S.). The first concerns the status of a disgorgement order in an SEC enforcement case that fails to satisfy the equitable limitations the Court discussed in the opinion. The second concerns the application of the five-year limitations period in 28 U.S.C. § 2462 to a disgorgement order complying with the Liu requirements. First, a disgorgement order that does not comply with the equitable restrictions described in the opinion would not be valid because courts do not have power to issue a disgorgement order in an SEC case unless the terms of the order meet those limitations. The question before the Court was whether a statute authorizing equitable relief in SEC cases allowed disgorgement orders, and the Court found that it did but only if the disgorgement order stays within the bounds of three traditional principles of equity. An award that does not comply is not equitable relief and lacks statutory authorization. Second, Liu nullified Kokesh v. SEC, 137 S. Ct. 1635 (2017), where the Court held that disgorgement in an SEC enforcement case imposed a penalty for purposes of applying the five-year limitations period in 28 U.S.C. § 2462. Liu found equitable relief to be incompatible with a penalty. Because a properly limited disgorgement award is equitable relief, equity does not enforce a penalty, and section 2462 applies only to claims for a fine, penalty, or forfeiture, the limitations period does not govern a disgorgement order that conforms to the equitable principles in Liu. The SEC may seek and a court may order disgorgement in a case commenced more than five years after the enforcement claim first accrued. Freeing a government enforcement claim from any limitations period is not the preferred policy outcome, but it appears to be the better reading of Liu.

A Review on Vehicle Classification and Potential Use of Smart Vehicle-Assisted Techniques.

Vehicle classification (VC) is an underlying approach in an intelligent transportation system and is widely used in various applications like the monitoring of traffic flow, automated parking systems, and security enforcement. The existing VC methods generally have a local nature and can classify the vehicles if the target vehicle passes through fixed sensors, passes through the short-range coverage monitoring area, or a hybrid of these methods. Using global positioning system (GPS) can provide reliable global information regarding kinematic characteristics; however, the methods lack information about the physical parameter of vehicles. Furthermore, in the available studies, smartphone or portable GPS apparatuses are used as the source of the extraction vehicle’s kinematic characteristics, which are not dependable for the tracking and classification of vehicles in real time. To deal with the limitation of the available VC methods, potential global methods to identify physical and kinematic characteristics in real time states are investigated. Vehicular Ad Hoc Networks (VANETs) are networks of intelligent interconnected vehicles that can provide traffic parameters such as type, velocity, direction, and position of each vehicle in a real time manner. In this study, VANETs are introduced for VC and their capabilities, which can be used for the above purpose, are presented from the available literature. To the best of the authors’ knowledge, this is the first study that introduces VANETs for VC purposes. Finally, a comparison is conducted that shows that VANETs outperform the conventional techniques.

Organization, state and activity of criminal investigation units intelligence work in the Middle Volga Region in the first half of the 1920s

The paper reflects the issues of formation and development of the agency work of state security and law enforcement agencies in the first half of the 1920s. The author considers the process of operational work formation of the criminal investigation department. Legal documents regulating the secret work of the Cheka and NKVD bodies are also considered. The categories of criminal investigation agents, the requirements imposed on them, the rules for building and controlling covert work, and the amount of funding are specified. Development and formation of the secret work of central and local criminal investigation institutions is traced on the example of the provincial criminal investigation departments of the Middle Volga region. On the basis of archival documents, the complexity and unevenness of this process in the regions are noted; the main problems (organizational, personnel and material) and the measures taken to eliminate them and improve the secret work are reflected. Materials of all-Russian congresses of NKVD territorial bodies heads show that much attention was paid to the organization of intelligence and operational work. The practical significance of covert work on the activities of the criminal investigation department is considered. The author has analyzed the influence of the received agent information by the Penza provincial department of criminal investigation on the activity of solving crimes in the second half of 1922.

SEC enforcement targets: a Christian virtue ethics perspective

PurposeThe purpose of this paper is to provide a summary and synthesis of US Securities and Exchange Commission accounting and auditing enforcement release (AAER)-based research on financial misreporting firms and the firms’ management. Christian virtue ethics (CVE) is used as a framework for this review. Suggestions for future research are presented.Design/methodology/approachThis is a review of the academic literature covering AAERs. The findings are viewed through the lens of CVE.FindingsSeveral financial misconduct studies use samples developed from AAER targets. These studies commonly focus on specific characteristics of AAER targets. This paper presents and analyzes characteristics of AAER targets and considers how CVE may mitigate fraudulent reporting.Research limitations/implicationsThe main limitation of the research is that the literature review is confined to studies of financial fraud that use an AAER-based sample. Nevertheless, the sample is sufficient to provide insight into the common characteristics of AAER target firms and related entities. The benefits of CVE are considered. This study has relevant implications for investors, regulators and researchers concerned with financial reporting quality, fraud, regulatory oversight and business ethics.Originality/valueThis paper provides a set of AAER target features and considers how CVE may mitigate financial fraud. Financial regulators, accounting standards setters and researchers may be interested in the findings presented in this study.

Rules-Based Accounting Standards and SEC Enforcement

This archival study investigates the association between rules-based violations and the likelihood of SEC enforcement. I utilize two samples of firms subject to SEC investigations: 1) firms with investigations that end in an enforcement action and 2) firms with investigations that are dropped, and examine the impact of rules-based accounting violations on enforcement. Each enforcement action in the sample specifically cites the GAAP standard violated, and the degree to which the standards contain rules-based characteristics is quantified. The violations are classified as either rules-based or principles-based and a multivariate analysis is performed. The “roadmap” theory suggests that firms who commit rules-based violations are more likely to be subject to SEC enforcement, while the “roadblock” theory predicts the opposite effect. 
 Overall, the results suggest the SEC is less likely to litigate cases that involve rules-based accounting violations, or more likely to drop/dismiss investigations centered on rules-based violations, consistent with the “roadblock” theory. No evidence is found of a relation between rules-based accounting violations and the dollar magnitude of penalties assessed. These results are relevant for financial statement preparers, auditors, and regulators.

The Court of Justice – Legal Reasoning, the Rule of Law and Data Protection

In the recently heard case of Privacy International, the Court of Justice of the European Union (“the Court”) was invited to reconsider its decision in Tele2 Sverige AB v Post-och telesyresen in relation to the issue of whether the Court had jurisdiction in circumstances where a Member State sought to rely on national security as a basis for mass surveillance operations. In Tele 2, which we shall discuss presently, the Court held that data retained in order to fight crime and for national security purposes could only be retained on a targeted basis and, accordingly, that the mass retention of data for these purposes, provided for under the laws impugned in Tele 2, was a disproportionate interference with the right to the protection of personal data under EU law. In Privacy International, Advocate General Sanchez-Bordona recommended that the Court’s insistence on “targeted retention” in Tele 2 should be replaced by a modified form of limited retention. The Privacy International case was one of an unprecedented number of references arising out of the issues raised in Tele 2. The difficulties created by that case in terms of the effectiveness of law enforcement and national security have posed very serious problems for Member States. It is the view of the authors that Tele 2 imposes restrictions that are unworkable and also that its meaning is unclear in some important respects.

OOPs! The Inherent Ambiguity of Out-of-Pocket Damages in Securities Fraud Class Actions

Most securities fraud class actions under SEC Rule 10b-5 involve revelation of negative information about the defendant company that should have been disclosed earlier – bad news that (allegedly) has been covered up by company agents. The standard remedy in such cases is out-of-pocket damages (OOPs). But this measure of harm is inherently ambiguous. Some courts interpret it as price inflation at the time of purchase. Others interpret it as the difference between the price paid and the price at which a stock settles after corrective disclosure. Although it might seem that these formulations are synonymous, the latter includes not only the difference in price that would have obtained if the truth had been known at the time of purchase but also any additional difference that might be caused by revelation of the truth. For example, the market may conclude that the company is likely to become the target of an SEC enforcement action or private securities litigation. Either way, the company is likely to suffer increased legal expenses. In addition, the company may suffer an increased cost of capital because the market perceives added risk that information about the company may be unreliable. These additional factors and possibly others – herein dubbed collateral damage – will be reflected in the decrease in price that occurs immediately upon corrective disclosure. But such collateral damage is harm suffered by the company that should be the subject of a derivative action – for the benefit of all stockholders – and not a direct (class) action. The clear implication is that OOPs should be measured as price inflation at the time of purchase– that is, price inflation narrowly defined net of any collateral damage. Indeed, because FRCP Rule 23 – which governs class actions – requires that a class action for damages be superior to any other means of resolving a dispute, Rule 23 itself requires that collateral damage be addressed in a derivative action simply because it can be so addressed. As demonstrated here, state corporation law is perfectly congruent with federal securities law such that a derivative action for collateral damage will lie whenever a meritorious claim can be stated under Rule 10b-5. Aside from simplifying the litigation process by providing for unitary corporate recovery, derivative actions avoid the circularity inherent in class actions while also addressing the problem of excessive deterrence by providing a perfectly tailored action against individual wrongdoers. Finally, because derivative actions quite clearly address corporate internal affairs, a corporation can assure that claims for collateral damage will be so addressed by adopting a bylaw to that effect.

Consistency analysis and flow secure enforcement of SELinux policies

SELinux policies used in practice contain tens of thousands of rules, making it hard to comprehend their impact on the security and to verify whether they actually meet the intended security goals. In this paper, we describe an approach for reasoning about the consistency of a given SELinux policy by analyzing the information flows caused by it. For this purpose, we model SELinux policy rules using the Readers-Writers Flow Model (RWFM). We have used this approach to implement a static policy analysis tool as well as a run-time monitor. The static policy analysis tool identifies all the possible indirect flows in a given policy and then filters out those indirect flows that pose a high threat. Given an indirect flow, the tool can also identify the sequences of accesses that cause the indirect flow. The tool also ranks the rules and domains based on the number of policy violations they cause. Thus, the static analysis tool is useful for policy writers to develop flow secure policies. The run-time monitor, on the other hand, keeps track of the information flows in an SELinux system and detects indirect flows dynamically. This helps in ensuring flow secure enforcement of a given SELinux policy as per the specification. The efficiency and efficacy of our implementations are demonstrated through experimental analysis on large, real-life policies.

The Sec, Cryptoasset Markets, and Game Theory: When Strategic Goals and Tactics Don’t Meet

This article contributes to the academic discourse on the regulation of cryptoassets in capital markets. The current cryptoasset policy of the Securities and Exchange Commission (“SEC”) is built on enforcement of the pre-crypto regulations without reform. This article analyzes the data on SEC enforcement, applies cost-benefit analysis to the regulation via enforcement approach, and examines manually collected issuer filings. The main conclusion is that the SEC has spent considerable resources on achieving an inefficient equilibrium in the crypto-market. The current status quo is characterized by the following antipodean trends: The SEC regulates via enforcement and ignores the significant “pure-information” component of the crypto-markets. The issuers, attempting to avoid enforcement actions, comply with the federal securities law in the most rational way by resorting to private placements. In the end, the crypto-investors, particularly the less sophisticated cohorts of investors, are exposed to the information asymmetry and agency costs of private placements aggravated by the unique risks of crypto-offerings. At bottom, the SEC has forced crypto-issuers to spend resources and comply with the laws that do not generate material benefits to investors, which suggests that the strategy of active enforcement is Kaldor-Hicks inefficient.

Auditor Litigation Risk: A Review of Past Perspectives, Recent Developments, and Emerging Issues

This review synthesizes key perspectives and trends in research and practice on the topic of auditor litigation, beginning with the immediate post-SOX era and ending in 2019. Although fears of catastrophic auditor liability in this period have not yet materialized, audit firms may be facing new vulnerabilities. This paper provides a summary of emerging concerns for the near future, with a focus on the outcome of recent court cases, SEC enforcement actions, increased litigation and insurance costs, changes in audit reporting standards, technological advancements, and cybersecurity. Future research is suggested to explore these topics.