The Real Danger
There is real danger of hackers due to the improvements in technology which make hacking into computer systems more easy. There as ample evidence has shown that some people are randomly probing portions of the Internet address space, looking for vulnerable machines. Anytime you are connected to the Internet you are assigned an IP address. This is your door, if it is open anyone can come in without you knowing it. the simplest protection is a utility that blocks intruders and alerts you. Most of these can be downloaded free on the internet and offer minimal security. Personal firewall software can be effective, but at times confusing to set up and a separate copy is required for each machine. The most effective firewall is a hardware device. It can be a separate computer with two network cards installed and proxy software. The important thing is having two network cards or MAC addresses, forcing network traffic through the proxy software. Another solution is a stand alone firewall device between your computer, or network and the Internet. these devices have drastically dropped in price recently and can be purchased for under $200.00.
What You Can Do
For the moment, at least, home firewalls aren't the answer.
There are already packages on the market that claim to shield your PC from attacks. Some ISPs are putting in filters of their own to guard the most vulnerable areas, notably Windows file system sharing. Special software can be installed on a computer system which will maintain an ‘audit trail’ for who has logged on, from which terminal and for how long. This will enable any unusaual activity to be spotted and investigations be made.
Some common forms of hacking...
Denial of service attacks are designed to lock out legitimate users from web sites or networks. Hackers run programs that repeatedly request information from the victim's computer until that computer is unable to answer any other requests. Hackers can run programs of automated scripts that barrage the victim computer or network so that it becomes unusable by legitimate users, or even has to be shut down.
Distributed denial of service attacks (DDoS) are automated attacks that run simultaneously from multiple computers. Hackers can plant Trojan horse programs on the computers of unsuspecting accomplices throughout the network or internet. At a given hour, all involved computers coordinate requests for information from the overloaded victim computer. Due to the numbers involved, such an attack can be very difficult to stop.
Trojans horse programs are "back doors" into a computer system. A hacker may disguise a trojan as another program, video, or game, in order to trick a user into installing it on their system. Once a Trojan is installed, a hacker could have access to all the files on a hard drive, a system's email, or even to create messages that pop up on the screen. Trojans are often used to enable even more serious attacks. By hiding programs to be run later, hackers might gain access to other networks. The simplest Trojan horse replaces the messages shown when a login is requested. Users think they are logging into the system, so they provide their usernames and passwords to a program that records the information for use by the hacker. The most famous Trojan horse to date is probably Back Orifice, once installed, this program gives the user access and control over any computer running a Windows 95/98 operating system or later.