Advertisement
<a href="http://krebsonsecurity.com/fbi-promises-action-against-money-mules/?administer_redirect_13=http://abaca.com/free_trial.html"><img src="/a-ab/missing.gif" /></a>
  • About the Author
  • About this Blog

    • Posts Tagged: fdic

    Target: Small Businesses — 47 Comments
    11
    May 10

    FBI Promises Action Against Money Mules

    The FBI’s top anti-cyber crime official today said the agency is planning a law enforcement action against so-called “money mules,” individuals willingly or unwittingly roped into helping organized computer crooks launder money stolen through online banking fraud.

    Patrick Carney, acting chief of the FBI’s cyber criminal section, said mules are an integral component of an international crime wave that is costing U.S. banks and companies hundreds of millions of dollars. He said the agency hopes the enforcement action will help spread awareness that money mules are helping to perpetrate crimes.

    “We want to make sure that public understands this is illegal activity and one of the best ways we can think of to give that message is to have some prosecutions,” Carney said at a Federal Deposit Insurance Corporation (FDIC) symposium in Arlington, Va. today on combating commercial payments fraud. “We realize it’s not going to make the problem go away, but it should help raise awareness and send a signal.”

    Continue reading →

    A Little Sunshine / Target: Small Businesses / The Coming Storm — 37 Comments
    9
    Mar 10

    Cyber Crooks Leave Traditional Bank Robbers in the Dust

    Organized cyber criminals stole more than $25 million from small to mid-sized businesses in brazen e-banking heists in the 3rd quarter of 2009 alone, federal regulators said last week. In contrast, traditional stick-up artists hauled less than $9.5 million out of U.S. banks over that same time period last year.

    Speaking at the RSA Security Conference in San Francisco last week, David Nelson, an examination specialist with the Federal Deposit Insurance Corporation (FDIC), said online banking attacks against small businesses of the sort I have chronicled countless times over the past year netted thieves $25 million between July and September of 2009.

    I wondered how that stacked up against real-life bank robbers here in the U.S., so I had a look at the FBI‘s published bank crime statistics for that same time period last year. Turns out, traditional bank robbers committed a total of 1,184 bank robberies during those three months, netting slightly more than $9.4 million (including $3,071 in travelers checks).

    In fact, real-life bank robbers stole a total of just over $30 million in the first three quarters of 2009, just $5 million more than cyber crooks did in the third quarter of last year alone.

    Small wonder that the haul from cyber bank robberies has overtaken that of physical heists:  Cyber thieves take far fewer risks to life, liberty and limb than do real-life bank robbers. In that same three month period last year, the FBI says bank robberies at bricks-and-mortar institutions caused five deaths — all them perpetrators of the crime.

    What’s more, the perpetrators of these incessant attacks against small businesses banking online for the most part reside in countries that are traditionally beyond the reach and influence of U.S. law enforcement. Sure, bank robbers occasionally kill people (more often themselves) while they’re stealing your money, instead of silently lifting it out of your bank account from afar like cyber thieves. That alone makes them a more emotional high-value target for the feds. But let’s face it: Traditional stick up artists are a lot easier to collar. For one thing, by necessity they are all here in the United States.

    In addition, while traditional bank robbers are limited to the amount of money they can physically carry from the scene of the crime, cyber thieves have a seemingly limitless supply of accomplices to help them haul the loot, by hiring so-called money mules to carry the cash for them.

    Continue reading →

    A Little Sunshine / Target: Small Businesses — 45 Comments
    3
    Mar 10

    Regulators Revisit E-Banking Security Guidelines

    Prodded by incessant reports of small- to mid-sized business losing millions of dollars at the hands of organized cyber criminals, federal regulators may soon outline more stringent steps that commercial banks need to take to protect business customers from online banking fraud and educate users about the risks of banking online.

    At issue are the guidelines jointly issued in 2005 by five federal banking regulators under the umbrella of the Federal Financial Institutions Examination Council (FFIEC). The guidance was meant to prod banks to implement so-called “multifactor authentication” — essentially, to require customers to provide something else in addition to a user name and password when logging into their bank accounts online, such as the output from a security token.

    The FFIEC didn’t specify exactly how the banks had to do this, and indeed it left it up to financial institutions to work out the most appropriate approach. However, many banks appear to have gravitated toward approaches that are relatively inexpensive, easy to defeat, and that may not strictly adhere to the guidance, such as forcing customers to periodically provide the answer to “challenge questions” as a prerequisite to logging in to their accounts online.

    Unfortunately, as I have documented time and again, organized computer criminals are defeating these solutions with ease. Experts say part of the problem is that few of these solutions can protect customers whose systems are already infected with password-stealing malicious software. What’s more, few banks have put in place technology on their back-end systems to monitor customer transactions for anomalies that may indicate fraudulent activity, much in the way that the credit card industry sifts through data in real time and alerts the customer if a transaction or set of transactions radically deviate from that customer’s usual purchasing habits.

    Last month, krebsonsecurity.com, interviewed Robert C. Drozdowski, a senior technology specialist with the Federal Deposit Insurance Corporation (FDIC). Drozdowski told me that the banking regulators recently convened a series of meetings with banks and security technology providers to figure out whether additional guidance would help banks do a better job of protecting their commercial customers. I asked him about the current state of these regulations and what we might expect from banking regulators in the months ahead on this issue. What follows is a portion of that discussion.

    Continue reading →