Title: Passwords for Compressed Folders are Recoverable
Date: 28 March 2001
Software: Plus! 98 and Windows Me
Impact: Data compression passwords can be recovered.
Bulletin: MS01-019

Microsoft encourages customers to review the Security Bulletin at:
http://www.microsoft.com/technet/security/bulletin/MS01-019.asp.

Issue:

Plus! 98, an optional package that extends Windows 98 and Windows 98
Second Edition, introduced a data compression feature called
Compressed Folders that was also included in Windows Me. For
interoperability with leading third-party compression tools, it
provides a password protection option for folders that have been
compressed. However, due to a flaw in the package's implementation,
the passwords used to protect the folders are recorded in a file on
the user's system. If an attacker gained access to an affected
machine
on which password-protected folders were stored, she could learn the
passwords and access the files.

It is important to understand that, although this flaw does
constitute
a security vulnerability, the password protection feature is not
intended to provide strong security. It was included in the products
to enable interoperability with password-protection features in other
third-party data compression products, and is only intended to
provide
protection against casual inspection. Customers who need strong
protection for files should use Windows(r) 2000.

The patch will prevent passwords from being written to the user's
system in the future. However, as discussed in the FAQ, after
applying
the patch, it is important to also delete c:\windows\dynazip.log, in
order to ensure that all previously-recorded passwords are deleted.

Mitigating Factors:

• The password at issue here is not related in any way to the
  user's network logon password. It is used solely for
  password-protecting compressed folders.
• An attacker would require physical access to an affected system
  in order to recover the password, or the owner of the machine
  would need to have deliberately shared out the c:\windows folder.

Patch Availability:

• A patch is available to fix this vulnerability. Please read the
  Security Bulletin
  http://www.microsoft.com/technet/security/bulletin/ms01-019.asp
  for information on obtaining this patch.

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