Security Alert – Smart Contract Wallets created in frontier are vulnerable to phishing attacks

Affected configurations: All smart contract wallets created using Ethereum Wallet Frontier, version 0.4.0 (Beta 7) or earlier. Wallets created with Ethereum Wallet 0.5.0 and all later versions released after March 3, 2016, are not affected.

Likelihood: Low

Severity: High

Summary:

Do not use wallet contracts or owner accounts of those wallets that were created by the Ethereum Wallet 0.4.0 or earlier. If you send to (or interact with) a malicious contract it could take ownership of your wallet contract. Create a new wallet and move your funds.

How to be super safe??

Don't use the vulnerable wallet contracts, AND the owner accounts of these wallets to send ether and interact with contracts you don't know!
If you don't use these accounts and wallets, and upgrade your wallet as described here, you are safe!

Details:

An attack vector was discovered that affects the smart contract wallets created before the Homestead release (Frontier phase). The attack can happen if an affected wallet interacts with a malicious contract OR if the owner account of an affected wallet interacts with a malicious contract that knows the address of his wallet. An attacker can then impersonate the owner and thus can steal funds or tokens and change the owner of the wallet.

If you do not use your wallet and owner accounts with contracts you don't know, you are safe!

Receiving Ether and sending Ether to non-contract accounts is fine.

Also if you configured your wallet with multisig, you are safer, as the attacker would need to make you send with all owners to malicious contract(s).

Proposed solution:

We recommend that if you created a wallet using the affected versions, you take one of these steps:

Create a new wallet with the latest version of Ethereum Wallet (any version from 0.5.0 or newer) and move your funds there. You can follow these steps.
Until you do the above, do not use any account which is an owner of an affected wallet, or the affected wallet itself to interact with closed source or otherwise unknown contracts that might trigger arbitrary actions (including forwarding Ether). Send/interact only to addresses you own, or know!
Create a secondary account for your every day usage. This one should not be connected to your contract wallets