I read it as being MitM and manipulating target (final, originally intended server) directories and files only, and in addition to spoof output to client to hide the fact it's doing so. In that case it does not matter where you run the client.
What makes MitMs possible is that checking fingerprint of new host is left to user. Instead we should have processes to automatically
1. acquire via other means and add fingerprint of each new target host
2. verify new host fingerprints with a separate party (central server or a ring of trusted buddies).
What makes MitMs possible is that checking fingerprint of new host is left to user. Instead we should have processes to automatically 1. acquire via other means and add fingerprint of each new target host 2. verify new host fingerprints with a separate party (central server or a ring of trusted buddies).