A security hole has been discovered which affects all versions of IE since 
version 4 plus OE and Outlook even if Active Scripting and ActiveX are 
disabled in the browser settings.  MS has no patch yet, but this page here 
http://www.theregus.com/content/4/24206.html has more details.
The site is experiencing heavy traffic so here are the details:

<snip>
IE, Outlook run malicious commands without scripting
By Thomas C Greene in Washington
Posted: 03/04/2002 at 08:46 EST
An attacker can run arbitrary commands on Windows machines with a simple 
bit of HTML, an Israeli security researcher has demonstrated. The exploit 
will work with IE, Outlook and OutlooK Express even if active scripting and 
ActiveX are disabled in the browser security settings.

The problem here is data binding, an old 'feature' going back to IE4 in 
which a data source object (DSO) is bound to HTML.

Using an XML data source, the researchers operating a Web site called 
GreyMagic Software came up with a simple example in which a few lines will 
cause Windows to launch the calculator application thus:

<span datasrc="#oExec" datafld="exploit" dataformatas="html"></span>
<xml id="oExec">
<security>
<exploit>
<![CDATA[
<object id="oFile" classid="clsid:11111111-1111-1111-1111-111111111111" 
codebase="c:/windows/system32/calc.exe"></object>
]]>
</exploit>
</security>
</xml>

You can copy and paste this into a text editor, where "windows" is your 
Windows directory, and name it whatever.htm. Then open the file with your 
browser and watch the calculator launch.

MS has yet to patch the hole, but we've verified that a workaround proposed 
by Axel Pettinger and Garland Hopkins works on the above example, though 
that's no guarantee that it will work on every exploit of this sort.

Using regedit.exe find the following key:
[HKEY_CURRENT_USER\Software\Microsoft\Windows\CurrentVersion\Internet 
Settings\Zones\0]
and change the value of "1004" (DWORD) from "0" to "3".

Don't forget to back up your registry before making changes, even innocuous 
ones like this.

You can then re-boot and open the example file with your browser again to 
verify that it fails to launch the calculator. However, the workaround will 
often cause IE to launch a security warning dialog box which has to be 
cleared before you can continue surfing. It tells you that your security 
settings are interfering with your rich Internet experience, and you can't 
tick a box ordering it to stop warning you of what you already know.

Personally I believe MS does this to discourage high security settings in 
IE which interfere with the rich eXPeriences advertisers have in store for 
you on the Web, and which MS seems inexplicably eager to vouchsafe. You 
don't get sick of the slightly scaled-down functionality; you get sick of 
the endless warnings and eventually capitulate and restore your settings to 
Redmond-approved, and Direct Marketing Association-approved, levels.

But we digress.

Obviously, there's a slew of malicious activities which can be attempted 
with this exploit, and a slew of people busily working on them. Thus it 
might be prudent to apply the workaround until Redmond issues a patch -- if 
you can stand to be harangued about your security settings at every turn, 
that is. �

<!snip>

Not nice but hopefully it is helpful.

Peter Kaulback
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