Hushmail unencrypted and handed over client’s emails; backdoor revealed

Hushmail was always known as a secure, private webmail company that markets itself by saying that “…not even a Hushmail employee with access to our servers can read your encrypted e-mail, since each message is uniquely encoded before it leaves your computer.” But it turns out that statement seems not to apply to individuals targeted by government agencies that are able to convince a Canadian court to serve a court order on the company.” So while the stored email is protected by the user’s passphrase, if this passphrase is authorized serverside by the user logging in via SSL the user is not using the more secure method with the Java Applet that they provide to have the passphrase encrypted (and I suspect hashed) before it’s sent over the wire. The advantage of the later approach is that the server never has the chance to see the ‘real’ password, but the user(s) gave up the ghost when they used the the SSL practice, which I suspect they never thought would lead to their downfall, especially when you look at how Hushmail markets themselves. So while not having to install that Java Applet is more convenient, it’s clearly less secure, “The rub of that option is that Hushmail has — even if only for a brief moment — a copy of your pass phrase. As they disclose in the technical comparison of the two options, this means that an attacker with access to Hushmail’s servers can get at the passphrase and thus all of the messages.“

To me this is not secure, I’m working on a client-server web authentication project and the server NEVER/EVER knows the password, it NEVER CAN. It is hashed and salted by the client, so there’s no way for the server to ever decrypt it; it only deals with the rehashed/resalted string of characters each time to match against. Even if an attacker could read the database they could not login as that user (plus I’m putting in more safeguards beyond that), but getting back on track this is what happened at Hushmail, somehow, “…the feds seemed to compel Hushmail to exploit this hole, store the suspects’ secret passphrase or decryption key, decrypt their messages and hand them over.” Now, Hushmail is a company out to make money, and I can understand them complying with the law, but to hack their own system to break the privacy of a client seems to go against how they present themselves. Clearly their service is far less secure than they advertise, and it only seems to allow enough privacy to fit the bill, so to speak. How can they advertise such great security if they know there’s such a big hole available for a (cr|h)acker to exploit? Now if they have in their TOS that in case of a court order against you that they may hack your password and release all of your mail they’d have more of a leg to stand on in my mind, but they don’t.