Yahoo reveals they suffered ANOTHER hack in 2013 that stole data from more than one billion users

  • Hackers stole data from more than one billion user accounts in August 2013
  • A different breach from one disclosed in September of 500 million accounts
  • Stolen info may include names, emails, phone numbers, birthdates and security questions and answers
  • The company still doesn't know how the data from the accounts was stolen

By Wires

Published: 17:13 EST, 14 December 2016 | Updated: 21:16 EST, 14 December 2016

Yahoo says it believes hackers stole data from more than one billion user accounts in August 2013.

The Sunnyvale, California, company says it's a different breach from the one it disclosed in September, when it said 500 million accounts were exposed. 

That new hack revelation raises questions about whether Verizon will try to change the terms of its $4.8 billion proposed acquisition of Yahoo.

Yahoo says hackers stole data from more than one billion user accounts in August 2013. The company says it's a different breach from the one it disclosed in September. Pictured here Marissa Mayer, who took the job as CEO at Yahoo in 2012

What can users do to protect their account?

Yahoo encourages users to visit its Safety Center page for recommendations on how to stay secure online. Some important recommendations Yahoo is re-emphasizing include the following:

- Change your passwords and security questions and answers for any other accounts on which you used the same or similar information used for your Yahoo account;

- Review all of your accounts for suspicious activity;

- Be cautious of any unsolicited communications that ask for your personal information or refer you to a web page asking for personal information;

- Avoid clicking on links or downloading attachments from suspicious emails; and

- Consider using Yahoo Account Key, a simple authentication tool that eliminates the need to use a password on Yahoo altogether.

Yahoo says the information stolen may include names, email addresses, phone numbers, birthdates and security questions and answers. 

The company says it believes bank-account information and payment-card data were not affected.

Yahoo said an unauthorized third party had stolen the data in the latest breach and that it was working closely with law enforcement.

Yahoo’s chief information security officer Bob Lord says that the company hasn’t been able to determine how the data from the one billion accounts was stolen. 

'Yahoo badly screwed up,' Bruce Schneier, a cryptologist and one of the world's most respected security experts, said after the internet company's latest disclosure. 'They weren't taking security seriously and that's now very clear. I would have trouble trusting Yahoo going forward.'  

Yahoo disclosed in September that hackers swiped personal information from at least 500 million Yahoo accounts. At the time, that hack was believed to be the biggest digital break-in at an email provider.

That breach dated back to late 2014. The company later revealed in a regulatory filing that it had detected evidence that a hacker had broken into its computer network at least 18 months before it launched the investigation that discovered the breach.

The latest breach discovery is a further embarrassment to a company that was one of the biggest names of the internet but which has failed to keep up with rising stars such as Google and Facebook.

Yahoo's valuation hit $125 billion during the dot-com boom, but it has been losing ground since then despite several efforts to reboot.

In the mid-1990s, Yahoo was among the most popular destinations on the internet, helping many people navigate the emerging web.

It became the top online 'portal', connecting users to news, music and other content. But its fortunes started to fade when Google began to dominate with its powerful search engine.

But as its core business declined, Yahoo's stake in outside investments - notably Chinese internet giant Alibaba - surged.

After a series of management changes and revival efforts, Yahoo decided to sell its main operating business as a way to separate that from its more valuable stake in Alibaba.

Yahoo's plan would place its main operating business within Verizon, which has already acquired another faded internet star, AOL.

Yahoo says it's a different breach from the one it disclosed in September, when it said 500 million accounts were exposed

The remaining portion would be a holding company with stakes in Alibaba and Yahoo Japan.

Verizon said in a statement it would await further news of the investigation before making any decision.

'As we’ve said all along, we will evaluate the situation as Yahoo continues its investigation,' the statement said.

"We will review the impact of this new development before reaching any final conclusions."

Verizon had said the prior breach was likely 'material', meaning it could allow the telecom giant to scrap the deal or lower its offer.   

Yahoo reveals the hack: The release

Important Security Information for Yahoo Users

By Bob Lord, CISO

Following a recent investigation, we’ve identified data security issues concerning certain Yahoo user accounts. We’ve taken steps to secure those user accounts and we’re working closely with law enforcement.

What happened?

As we previously disclosed in November, law enforcement provided us with data files that a third party claimed was Yahoo user data. We analyzed this data with the assistance of outside forensic experts and found that it appears to be Yahoo user data. Based on further analysis of this data by the forensic experts, we believe an unauthorized third party, in August 2013, stole data associated with more than one billion user accounts. We have not been able to identify the intrusion associated with this theft. We believe this incident is likely distinct from the incident we disclosed on September 22, 2016.

For potentially affected accounts, the stolen user account information may have included names, email addresses, telephone numbers, dates of birth, hashed passwords (using MD5) and, in some cases, encrypted or unencrypted security questions and answers. The investigation indicates that the stolen information did not include passwords in clear text, payment card data, or bank account information. Payment card data and bank account information are not stored in the system the company believes was affected.

Separately, we previously disclosed that our outside forensic experts were investigating the creation of forged cookies that could allow an intruder to access users’ accounts without a password. Based on the ongoing investigation, we believe an unauthorized third party accessed our proprietary code to learn how to forge cookies. The outside forensic experts have identified user accounts for which they believe forged cookies were taken or used. We are notifying the affected account holders, and have invalidated the forged cookies. We have connected some of this activity to the same state-sponsored actor believed to be responsible for the data theft the company disclosed on September 22, 2016.

What are we doing to protect our users?

We are notifying potentially affected users and have taken steps to secure their accounts, including requiring users to change their passwords. We have also invalidated unencrypted security questions and answers so that they cannot be used to access an account. With respect to the cookie forging activity, we invalidated the forged cookies and hardened our systems to secure them against similar attacks. We continuously enhance our safeguards and systems that detect and prevent unauthorized access to user accounts.

What can users do to protect their account?

We encourage our users to visit our Safety Center page for recommendations on how to stay secure online. Some important recommendations we’re re-emphasizing today include the following:

Change your passwords and security questions and answers for any other accounts on which you used the same or similar information used for your Yahoo account;

Review all of your accounts for suspicious activity;

Be cautious of any unsolicited communications that ask for your personal information or refer you to a web page asking for personal information;

Avoid clicking on links or downloading attachments from suspicious emails; and

Consider using Yahoo Account Key, a simple authentication tool that eliminates the need to use a password on Yahoo altogether.

For more information about these security matters and our security resources, please visit the Yahoo Security Issue FAQs page, https://yahoo.com/security-update. 

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