The bug, discovered by German firm, allows hackers to remotely gain control of and also clone certain mobile SIM cards.
Hackers could use compromised SIMs to commit financial crimes or engage in electronic espionage, according to Berlin's Security Research Labs, which will describe the vulnerabilities at the Black Hat hacking conference that opens in Las Vegas on July 31.
The U.N.'s Geneva-based International Telecommunications Union, which has reviewed the research, described it as "hugely significant."
"These findings show us where we could be heading in terms of cyber-security risks," ITU Secretary General Hamadoun Touré told Reuters.
He said the agency would notify telecommunications regulators and other government agencies in nearly 200 countries about the potential threat and also reach out to hundreds of mobile companies, academics and other industry experts.
A spokeswoman for the GSMA, which represents nearly 800 mobile operators worldwide, said it also reviewed the research.
"We have been able to consider the implications and provide guidance to those network operators and SIM vendors that may be impacted," said GSMA spokeswoman Claire Cranton.
Nicole Smith, a spokeswoman for Gemalto NV, the world's biggest maker of SIM cards, said her company supported GSMA's response.
"Our policy is to refrain from commenting on details relating to our customers' operations," she said.
Becoming the SIM
Cracking SIM cards has long been the Holy Grail of hackers because the tiny devices are located in phones and allow operators to identify and authenticate subscribers as they use networks.
Karsten Nohl, the chief scientist who led the research team and will reveal the details at Black Hat, said the hacking only works on SIMs that use an old encryption technology known as DES.
Nohl said he conservatively estimates that at least 500 million phones are vulnerable to the attacks he will discuss at Black Hat. He added that the number could grow if other researchers start looking into the issue and find other ways to exploit the same class of vulnerabilities.
The ITU estimates some 6 billion mobile phones are in use worldwide. It plans to work with the industry to identify how to protect vulnerable devices from attack, Touré said.
Once a hacker copies a SIM, it can be used to make calls and send text messages impersonating the owner of the phone, said Nohl, who has a doctorate in computer engineering from the University of Virginia.
"We become the SIM card. We can do anything the normal phone users can do," Nohl said in a phone interview.
"If you have a MasterCard number or PayPal data on the phone, we get that too," if it is stored on the SIM, he said.
The newly identified attack method only grants access to data stored on the SIM, which means payment applications that store their secrets outside of the SIM card are not vulnerable to this particular hacking approach.
Yet Nohl warned that when data is stored outside of a SIM card it could fall victim to a large range of other already known vulnerabilities, which is what has prompted the industry to put payment information on SIMs in the first place.
iPhone, Android, BlackBerry
The mobile industry has spent several decades defining common identification and security standards for SIMs to protect data for mobile payment systems and credit card numbers. SIMs are also capable of running apps.
Nohl said Security Research Labs found mobile operators in many countries whose phones were vulnerable, but declined to identify them. He said mobile phone users in Africa could be among the most vulnerable because banking is widely done via mobile payment systems with credentials stored on SIMs.
All types of phones are vulnerable, including iPhones from Apple Inc, phones that run Google Inc's Android software and BlackBerry Ltd smartphones, he said.
BlackBerry's director of security response and threat analysis, Adrian Stone, said in a statement that his company proposed new SIM card standards last year to protect against the types of attacks described by Nohl, which the GSMA has adopted and advised members to implement.
Apple and Google declined comment.
CTIA, a U.S. mobile industry trade group based in Washington, D.C., said the new research likely posed no immediate threat.
"We understand the vulnerability and are working on it," said CTIA Vice President John Marinho. "This is not what hackers are focused on. This does not seem to be something they are exploiting."
© Thomson Reuters 2013
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