*FACEPALM*

This was just too good to not share.

Just had a look at an app for a friend that used a dongle. (Some weird brand/model of dongle that I'd never heard of before). So, I run the normal analysis on the application, and see that the author has chosen to pack his executable. Not a bad idea! If you want to do this for the protection/anti-tamper benefits of a compressed application, I would HIGHLY recommend not using an open source, and publicly available compressor. In this case, it was UPX. (http://upx.sourceforge.net/)

A quick look around the net, and I had an app that not only could tell you ALL about the compression on the app, but also removed it, cleaned up the .exe and everything else. Spit out a virgin looking executable.

So, on to the next step. Load it into IDA, and have a look around. I quickly find the "USB Dongle not found" string, and trace that back to a function that does a couple of things (calls ebp+xxx based functions), and makes a decision about the results. A little digging revealed that they were dynamically loading a DLL from inside themselves, (Almost like a resource), and then doing a loop of "GetProcAddress" to get the addresses of the functions they wanted. Each was stored in an ebp+xxx location. Turns out that he only called the dongle function from 2 places, once on startup, and then he spawned a thread that checked that the dongle was STILL attached every 3 seconds. Not bad dude, not bad at all.

Then, while looking at the functions that called the dongle function, I noticed a comparison of ebp+644, and if this value was 0, it skipped not only the startup check, but didn't create the thread to continuously check the key either. What's going on here?

It was ... A command line option to skip the protection completely. When the program started, one of the first things that he did was to get the command line, and to use strstr to search for his magic string. If found, it would clear the flag, and the protection routines never got executed.

FAIL!