Software Engineering Institute

IE provides several settings for the various security zones. These settings can prevent certain actions from taking place in their respective zones. One such setting is "Drag and drop or copy and paste files." Windows XP and Windows Server 2003 fail to honor this preference, always allowing such operations to take place. Because this setting may not be honored by IE, the setting cannot be used as a workaround to prevent "drag and drop" style attacks.

IE will permit drag and drop or copy and paste operations, even when the security settings indicate otherwise. By convincing a user to perform a drag and drop operation, an attacker could copy arbitrary files to a known location on a user's computer. If the target location is shell:startup, then it is possible to cause arbitrary code to be automatically executed the next time the user logs in. When combined with VU#413886 and VU#490708, the drag and drop operation can be triggered by actions such as dragging the IE scrollbar, selecting text, or clicking an image.

Apply a patch

Apply the patch referenced in MS04-038. The Security Bulletin states:

The update repairs the behavior of the "Drag and Drop or copy and paste files" security setting on Internet Explorer on Windows XP. If this setting was set to Disable or Prompt for a particular zone on Windows XP, it would not disable or prompt when dragging, dropping, copying or pasting files as documented on "Setting up Security Zones" Changes have been made to this setting to match the behavior as documented.
In our testing, we have found that this issue is not limited to Windows XP. Windows Server 2003 is affected in the same way as Windows XP. In addition, the "Prompt" setting functions the same as "Disable" after the installation of the patch from MS04-038 on Windows XP and Windows Server 2003 systems. In other words, if the "Drag and drop or copy and paste files" option is set to "Prompt," the drag and drop operations will not function, and no confirmation dialog is presented to the user. "Enable" and "Disable" behave as expected.