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Stepping-stone attacks are often used by network intruders to hide their identities. In a stepping-stone attack, attacking commands are sent indirectly to the victim through a chain of compromised hosts acting as "stepping stones." In defending against such attacks, it is necessary to detect stepping-stone connections at the compromised hosts. The use of encrypted connections by the attacker complicates the detection problem and the attacker's active timing perturbation and insertion of chaff make it even more challenging. This paper considers strategies to identify stepping-stone connections when the attacker is able to encrypt the attacking packets and perturb their timing. Furthermore, the attacker can also add chaff packets in the attacking stream. The paper first considers stepping-stone connections subject to packet-conserving transformations by the attacker. Two activity-based algorithms are proposed to detect …