Apple Takes 3 Months But Finally Stops Printing Passwords in Plaintext

Famed OS X hacker Charlie Miller once told a security blog, “Mac OS X is like living in a farmhouse in the country with no locks, and Windows is living in a house with bars on the windows in the bad part of town.”

But of late there have been some thieves in the farm house, and even Apple, Inc. (AAPL) has started to admit that it has security issues — well, after realizing that telling its technicians to lie to customers about them might be bad publicity.  One recent piece of malware is estimated to have infected 600K Macs and generated millions in profit for identity thieves alone.

Kapersky Labs, a top security firm recently warned the public that Apple’s security was 10 years behind Microsoft Corp.’s (MSFT).  Evidence of that was seen in the 10.7.3 build of OS X “Lion”, which due a programming error (a stray debugging flag left on in OS X’s source) accidentally logged in plaintext the passwords of users who used legacy FileVault settings.

An Apple user, Eric Hildum complained in the support forums three months ago:
I’ve tried it on another Mac as well, same result: The login of a normal network user writes this log line as his homedir gets mounted.
This poses a security risk. We have some users who are local admins, they could ask another user to login on their Mac and look for the password afterwards. Extration in single user mode would be possible as well.

Is this a “speciality” of our environment or is this a known bug? Can I turn this behavior off?
We are running Lion clients with a SL Server and using OpenDirectory.
Apparently the Apple answer was that this was a “feature” for the time being, because the user received no reply to his pleas for three months.  Then a security researcher by the name of David Emery, posted his findings to the Cryptome mailing list, a list frequent by hackers.

As noted by Mr. Emery, the issue did not effect purchasers of new Lion systems, but might have affected many users of legacy systems who upgraded to Lion.

With the Cryptome email, the media began to catch wind of Lion’s penchant for plaintext password dumping and Apple was forced into the awkward position of providing an “update” for its “feature”.

Hence OS X 10.7.4 was born, and aired today to loyal Lion subscribers.  

The patch also “improves” other “features”, such as no longer losing settings to the “reopen windows when logging back in” checkbox, and allowing “certain British third-party keyboards” to finally work.

Apple may still be living in the dark ages of security, but at least it’s figured out not to stores users’ passwords in plaintext, even if it took the company three months of complaints.  On the plus side, the three month turnaround is faster than past incidents where Apple took up to a year to fix past security issues/features.