Posts Tagged: Rustock


15
Jan 13

Spam Volumes: Past & Present, Global & Local

Last week, National Public Radio aired a story on my Pharma Wars series, which chronicles an epic battle between men who ran two competing cybercrime empires that used spam to pimp online pharmacy sites. As I was working with the NPR reporter on the story, I was struck by how much spam has decreased over the past couple of years.

Below is a graphic that’s based on spam data collected by Symantec‘s MessageLabs. It shows that global spam volumes fell and spiked fairly regularly, from highs of 6 trillion messages sent per month to just below 1 trillion. I produced this graph based on Symantec’s raw spam data.

gsv07-12

Some of the points on the graph where spam volumes fall precipitously roughly coincide with major disruptive events, such as the disconnection of rogue ISPs McColo Corp. and 3FN, as well as targeted takedowns against major spam botnets, including Bredolab, Rustock and Grum. Obviously, this graph shows a correlation to those events, not a direct causation; there may well have been other events other than those mentioned that caused decreases in junk email volumes worldwide. Nevertheless, it is clear that the closure of the SpamIt affiliate program in the fall of 2010 marked the beginning of a steep and steady decline of spam volumes that persists to this day.

Of course, spam volumes are relative, depending on where you live and which providers you rely on for email and connections to the larger Internet. As I was putting together these charts, I also asked for spam data from Cloudmark, a San Francisco-based email security firm. Their data (shown in the graphs below) paint a very interesting picture of the difference in percentage of email that is spam coming from users of the top three email services: The spam percentages were Yahoo! (22%), Microsoft (11%) and  Google (6%).

WebMailSpamCloudmark

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11
Dec 12

A Closer Look at Two Bigtime Botmasters

Over the past 18 months, I’ve published a series of posts that provide clues about the possible real-life identities of the men responsible for building some of the largest and most disruptive spam botnets on the planet. I’ve since done a bit more digging into the backgrounds of the individuals thought to be responsible for the Rustock and Waledac spam botnets, which has produced some additional fascinating and corroborating details about these two characters.

In March 2011, KrebsOnSecurity featured never-before-published details about the financial accounts and nicknames used by the Rustock botmaster. That story was based on information leaked from SpamIt, a cybercrime business that paid spammers to promote rogue Internet pharmacies (think Viagra spam). In a follow-up post, I wrote that the Rustock botmaster’s personal email account was tied to a domain name ger-mes.ru, which at one time featured a résumé of a young man named Dmitri A. Sergeev.

Then, on Jan. 26. 2012, I ran a story featuring a trail of evidence suggesting a possible identity of “Severa (a.k.a. “Peter Severa”), another SpamIt affiliate who is widely considered the author of the Waledac botnet (and likely the Storm Worm). In that story, I included several screen shots of Severa chatting on Spamdot.biz, an extremely secretive Russian forum dedicated to those involved in the spam business. In one of the screen shots, Severa laments the arrest of Alan Ralsky, a convicted American spam kingpin who specialized in stock spam and who — according to the U.S. Justice Department – was partnered with Severa. Anti-spam activists at Spamhaus.org maintain that Peter Severa’s real name is Peter Levashov (although the evidence I gathered also turned up another name, Viktor Sergeevich Ivashov).

It looks now like Spamhaus’s conclusion on Severa was closer to the truth. More on that in a second. I was able to feature the Spamdot discussions because I’d obtained a backup copy of the forum. But somehow in all of my earlier investigations I overlooked a handful of private messages between Severa and the Rustock botmaster, who used the nickname “Tarelka” on Spamdot. Apparently, the two worked together on the same kind of pump-and-dump stock spam schemes, but also knew each other intimately enough to be on a first-name basis.

Spamdot.biz chat between Tarelka and Severa

The following is from a series of private Spamdot message exchanged between Tarelka and Severa on May 25 and May 26, 2010. In it, Severa refers to Tarelka as “Dimas,” a familiar form of “Dmitri.” Likewise, Tarelka addresses Severa as “Petka,” a common Russian diminutive of “Peter.” They discuss a mysterious mutual friend named John, who apparently used the nickname “Apple.”

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22
Jun 12

PharmaLeaks: Rogue Pharmacy Economics 101

Consumer demand for cheap prescription drugs sold through spam-advertised Web sites shows no sign of abating, according to a new analysis of bookkeeping records maintained by three of the world’s largest rogue pharmacy operations.

Researchers at the University of California, San Diego, the International Computer Science Institute and George Mason University examined caches of data tracking the day-to-day finances of GlavMed, SpamIt, and Rx-Promotion, shadowy affiliate programs that over a four-year period processed more than $170 million worth of orders from customers seeking cheaper, more accessible and more discretely available drugs. The result is perhaps the most detailed analysis yet of the business case for the malicious software and spam epidemics that persist to this day.

Their conclusion? Spam — and all of its attendant ills — will remain a prevalent and pestilent problem because consumer demand for the products most frequently advertised through junk email remains constant.

“The market for spam-advertised drugs is not even close to being saturated,” said Stefan Savage, a lead researcher in the study, due to be presented early next month at the 21st USENIX security conference in Bellevue, Wash. “The number of new customers these programs got each day explains why people spam: Because sending spam to everyone on the planet gets you new customers on an ongoing basis, so it’s not going away.”

The researchers found that repeat customers are critical to making any rogue pharmacy business profitable. Repeat orders constituted 27% and 38% of average program revenue for GlavMed and SpamIt, respectively; for Rx-Promotion, revenue from repeat orders was between 9% and 23% of overall revenue.

“This says a number of things, and one is that a lot of people who bought from these programs were satisfied,” Savage said. “Maybe the drugs they bought had a great placebo effect, but my guess is these are satisfied customers and they came back because of that.”

Whether the placebo effect is something that often applies with the consumption of erectile dysfunction drugs is not covered in this research paper, but ED drugs were by far the largest category of pills ordered by customers of all three pharmacy programs.

One interesting pattern that trickled out of the Rx-Promotion data underscores what made this pharmacy affiliate unique and popular among repeat buyers: A major portion of its revenues was generated through the sale of drugs that have a high potential for abuse and are thus tightly controlled in the United States, including opiates and painkillers like Oxycodone, Hydrocodone, and mental health pills such as Adderall and Ritalin. The researchers noticed that although pills in this class of drugs — known as Schedule II in U.S. drug control parlance — comprised just 14 percent of orders for Rx-Promotion, they accounted for nearly a third of program revenue, with the Schedule II opiates accounting for a quarter of revenue.

“The fact that such drugs are over-represented in repeat orders as well (roughly 50 percent more prevalent in both Rx-Promotion and, for drugs like Soma and Tramadol, in SpamIt) reinforces the hypothesis that abuse may be a substantial driver for this component of demand,” the researchers wrote.

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16
Apr 12

Microsoft Responds to Critics Over Botnet Bruhaha

Microsoft’s most recent anti-botnet campaign — a legal sneak attack against dozens of ZeuS botnets — seems to have ruffled the feathers of many in security community. The chief criticism is that the Microsoft operation exposed sensitive information that a handful of researchers had shared in confidence, and that countless law enforcement investigations may have been delayed or derailed as a result. In this post, I interview a key Microsoft attorney about these allegations.

Since Microsoft announced Operation B71, I’ve heard from several researchers who said they were furious at the company for publishing data on a group of hackers thought to be behind a majority of the ZeuS botnet activity — specifically those targeting small to mid-sized organizations that are getting robbed via cyber heists. The researchers told me privately that they believed Microsoft had overstepped its bounds with this action, using privileged information without permission from the source(s) of that data (many exclusive industry discussion lists dedicated to tracking cybercriminal activity have strict rules about sourcing and using information shared by other members).

At the time, nobody I’d heard from with complaints about the action wanted to speak on the record. Then, late last week, Fox IT, a Dutch security firm, published a lengthy blog post blasting Microsoft’s actions as “irresponsible,” and accusing the company of putting its desire for a public relations campaign ahead of its relationship with the security industry.

“This irresponsible action by Microsoft has led to hampering and even compromising a number of large international investigations in the US, Europe and Asia that we knew of and also helped with,” wrote Michael Sandee, Principal Security Expert at Fox IT. “It has also damaged and will continue to damage international relationships between public parties and also private parties. It also sets back cooperation between public and private parties, so called public private partnerships, as sharing will stop or will be definitely less valuable than it used to be for all parties involved.”

Sandee said that a large part of the information that Microsoft published about the miscreants involved was sourced from individuals and organizations without their consent, breaking various non-disclosure agreements (NDAs) and unspoken rules.

“In light of the whole Responsible Disclosure debate  [link added] from the end of Microsoft this unauthorized and uncoordinated use and publication of information protected under an NDA is obviously troublesome and shows how Microsoft only cares about protecting their own interests,” Sandee wrote.

Given the strong feelings that Microsoft’s actions have engendered in the Fox IT folks and among the larger security community, I reached out to Richard Boscovich, a former U.S. Justice Department lawyer who was one of the key architects of Microsoft’s legal initiative against ZeuS. One complaint I heard from several researchers who believed that Microsoft used and published data they uncovered was that the company kept the operation from nearly everyone. I asked Boscovich how this operation was different from previous actions against botnets such as Rustock and Waledac.

Boscovich: It’s essentially the same approach we’ve done in all the other operations. The problem that I think some people have is that due to the type of operation, we can’t have the entire community involved. That’s for several reasons. One is operational security. The bigger the number of people involved, the more likely is that is someone will make a mistake and say something that could jeopardize all of the work that everyone has done. Also, we’re making representations to a federal court that this is an ex-parte motion and very limited people know about it. If you have multiple people knowing, and the entire security community knows, let’s say we submit declarations from 30-40 people. A court may say, ‘Well there’s a lot of people here who know about this, so isn’t this information that’s already publicly available? Don’t these people know you’re looking at them already?’ We’re really asking for an extraordinary remedy: an ex-parte TRO [temporary restraining order] is a very high standard. We have to show an immediate threat and harm, ongoing, so much so that we can’t even give the other side notice that we’re going to sue them and take away their property.

The other concern is more operational. When I was in the Justice Department — I was there for just shy of 18 years — we even compartmentalized operations there. Information was shared on a need-to-know basis, to make sure the operation would be a success and that there wouldn’t be any inadvertent leaks. It wasn’t because we didn’t trust people, but because people sometimes make mistakes. So in this operation, just like the others, we engaged with industry partners, academic partners, and some of those who wished to be open, and others who preferred to do things behind the scenes.

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5
Jan 12

Pharma Wars: Mr. Srizbi vs. Mr. Cutwail

The previous post in this series introduced the world to “Google,” an alias chosen by the hacker in charge of the Cutwail spam botnet. Google rented his crime machine to members of SpamIt, an organization that paid spammers to promote rogue Internet pharmacy sites. This made Google a top dog, but also a primary target of rival botmasters selling software to SpamIt, particularly the hacker known as “SPM,” the brains behind the infamous Srizbi botnet.

Today’s Pharma Wars entry highlights that turf battle, and features newly discovered clues about the possible identity of the Srizbi botmaster, including his whereabouts and current occupation.

Reactor Mailer Terms of Service, 2005

Srizbi burst onto the malware scene in early 2007, infecting hundreds of thousands of Microsoft Windows computers via exploit kits stitched into hacked and malicious Web sites. SpamIt members could rent access to the collection of hacked machines via a piece of spamware that had been around since 2004, known as “Reactor Mailer.”

This page from archive.org (pictured at right) is a Feb. 2005 snapshot of the terms of service for the Reactor Mailer service, explaining how it worked and its pricing structure. The document is signed by  “SPM,” who claims to be the CEO of a company called Elphisoft. He asks customers and would-be clients to contact him via ICQ instant message ID 360000 (the importance of this number will be apparent later in the story).

That same ICQ number features prominently in dozens of chat logs that apparently belonged to SpamIt co-administrator Dmitry “Saintd” Stupin. The logs were leaked online last year after Russian investigators questioned Stupin as part of an investigation into Igor Gusev, the alleged other co-founder of SpamIt. Facing criminal charges for his alleged part in SpamIt, Gusev chose to shutter the program October 2010, but not before its affiliate database was stolen and also leaked online.

BOTMASTER BATTLE

SPM is introduced to SpamIt in May 2007, when he joins the program with the hopes of becoming the default spam software provider for the pharmacy affiliate program. The chats translated and recorded at this link show SPM’s early communications with SpamIt, in which he brings on board several other affiliates who will help develop and maintain his Reactor/Srizbi botnet.

Very soon after joining SpamIt, SPM identifies Google — the Cutwail botmaster — as his main competitor, and sets off to undermine Google and to become the default spam software provider to SpamIt.

The following is from a chat between SPM and Stupin, recorded Oct. 9, 2007, in which SPM argues that he should be the primary spam software seller for SpamIt, and that his software’s logo should be embedded in the SpamIt banner at the organization’s closely-guarded online user forum.

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22
Aug 11

Flashy Cars Got Spam Kingpin Mugged

A Russian spammer suspected of maintaining the infamous Rustock spam botnet earned millions of dollars blasting junk email for counterfeit Internet pharmacies. Those ill-gotten riches let him buy flashy sports cars, but new information suggests that this attracted the attention of common street thugs who targeted and ultimately mugged the spammer, stealing two of his prized rides.

BMW 530xi

In March, I published a story linking the Rustock botnet to a spammer who used the nickname Cosma2k. This individual was consistently one of the top five moneymakers for SpamIt, which, until its closure last fall, paid spammers millions of dollars a year and was the world’s largest distributor of junk mail.

Earlier this month, someone leaked thousands of online chat logs taken from Dmitry “SaintD” Stupin, a Russian who allegedly ran the day-to-day operations of SpamIt. Those records include numerous chat conversations allegedly between Stupin and a SpamIt affiliate named Cosma.

In several chats, Cosma muses on what he should do with tens of thousands of compromised but otherwise idle PCs under his control. Throughout the discussions between Stupin and Cosma, it is clear Cosma had access to internal SpamIt resources that other spammers did not, and that he had at least some say in the direction of the business.

Porsche Cayenne

In one conversation, dated Oct. 14, 2008, Cosma allegedly tells Stupin that he’s dialed back his public image a few notches, after attracting unwanted attention from other crooks. The conversation below, translated from Russian into English, begins with a request from Cosma to withdraw funds from a SpamIt operating account.

Cosma: Hey. May I withdraw some money from the account?

Stupin: Surely you may.

Stupin: Sorry, I was picking up my car from the service shop.

Cosma: What got broken?

Stupin: Someone threw a stone, when the car was parked near home.

Cosma: Damn. What kind of car?

Stupin: Volvo.

Cosma: Fond of safety?

Stupin: Yes, and I am at ease when I am driving it. It’s a huge difference after Honda :)

Cosma: I also had enough of expensive rigs. =) They are getting stolen all the time and everyone is looking at you, estimating the score, and then rob you =) I have had such experience =)

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18
Jul 11

Microsoft Offers $250K Bounty for Rustock Author

Microsoft said today that it is offering a $250,000 reward for new information leading to the arrest and conviction of the individual(s) responsible for the Rustock botnet, a now-defunct crime machine that was once responsible for sending 40 percent of all junk email.

The bounty is the software giant’s latest salvo in its war on Rustock; Microsoft secured a major victory in March, when it worked with ISPs and security firms to launch a successful sneak attack against the botnet, knocking out its support infrastructure. Richard Boscovich, senior attorney for Microsoft’s digital crimes unit, said that although spam from Rustock-infected PCs has ceased, there are still hundreds of thousands of infected computers around the world to be cleaned of the botnet malware.

Microsoft's Rustock notice in The Moscow News, June 14

“This reward offer stems from Microsoft’s recognition that the Rustock botnet is responsible for a number of criminal activities and serves to underscore our commitment to tracking down those behind it,” Boscovich wrote in a post on the official Microsoft blog. “While the primary goal for our legal and technical operation has been to stop and disrupt the threat that Rustock has posed for everyone affected by it, we also believe the Rustock bot-herders should be held accountable for their actions.”

Microsoft recently ran advertisements in major newspapers in Moscow and St. Petersburg, as part of a deal the company struck with a U.S. court to help dismantle Rustock; the court granted Microsoft dominion over the Rustock control servers and domains as long as the company made a “good faith” effort to notify the unidentified owners.

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1
Jul 11

Where Have All the Spambots Gone?

First, the good news: The past year has witnessed the decimation of spam volume, the arrests of several key hackers, and the high-profile takedowns of some of the Web’s most notorious botnets. The bad news? The crooks behind these huge crime machines are fighting back — devising new approaches designed to resist even the most energetic takedown efforts.

The volume of junk email flooding inboxes each day is way down from a year ago, as much as a 90 percent decrease according to some estimates. Symantec reports that spam volumes hit their high mark in July 2010, when junk email purveyors were blasting in excess of 225 billion spam messages per day. The company says daily spam volumes now hover between 25 and 50 billion missives daily. Anti-spam experts from Cisco Systems are tracking a similarly precipitous decline, from 300 billion per day in June 2010 to just 40 billion in June 2011.

Spam messages per day, July 2010 - July 2011. Image courtesy Symantec.

There may be many reasons for the drop in junk email volumes, but it would be a mistake to downplay efforts by law enforcement officials and security experts.  In the past year, authorities have taken down some of the biggest botnets and apprehended several top botmasters. Most recently, the FBI worked with dozens of ISPs to kneecap the Coreflood botnet. In April, Microsoft launched an apparently successful sneak attack against Rustock, a botnet once responsible for sending 40 percent of all junk email.

Daily spam volume July 2010 - July 2011. Image courtesy Spamcop.net

In December 2010, the FBI arrested a Russian accused of running the Mega-D botnet. In October 2010, authorities in the Netherlands arrested the alleged creator of the Bredolab botnet and dismantled huge chunks of the botnet. A month earlier, Spamit.com, one of the biggest spammer affiliate programs ever created, was shut down when its creator, Igor Gusev, was named the world’s number one spammer and went into hiding. In August 2010, researchers clobbered the Pushdo botnet, causing spam from that botnet to slow to a trickle.

But botmasters are not idly standing by while their industry is dismantled. Analysts from Kaspersky Lab this week published research on a new version of the TDSS malware (a.k.a. TDL), a sophisticated malicious code family that includes a powerful rootkit component that compromises PCs below the operating system level, making it extremely challenging to detect and remove. The latest version of TDSS — dubbed TDL-4 has already infected 4.5 million PCs; it uses a custom encryption scheme that makes it difficult for security experts to analyze traffic between hijacked PCs and botnet controllers. TDL-4 control networks also send out instructions to infected PCs using a peer-to-peer network that includes multiple failsafe mechanisms.

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28
Mar 11

Microsoft Hunting Rustock Controllers

Who controlled the Rustock botnet? The question remains unanswered: Microsoft’s recent takedown of the world’s largest spam engine offered tantalizing new clues to the identity and earnings of the Rustock botmasters. The data shows that Rustock’s curators made millions by pimping rogue Internet pharmacies, but also highlights the challenges that investigators still face in tracking down those responsible for building and profiting from this complex crime machine.

Earlier this month, Microsoft crippled Rustock by convincing a court to let it seize dozens of Rustock control servers that were scattered among several U.S.-based hosting providers. Shortly after that takedown, I began following the money trail to learn who ultimately paid the botnet controllers’ hosts for their services.

According to interviews with investigators involved in the Rustock takedown, approximately one-third of the control servers were rented from U.S. hosting providers by one entity: A small business in Eastern Europe that specializes in reselling hosting services to shadowy individuals who frequent underground hacker forums.

KrebsOnSecurity.com spoke to that reseller. In exchange for the agreement that I not name his operation or his location, he provided payment information about the customer who purchased dozens of servers that were used to manipulate the day-to-day operations of the massive botnet.

The reseller was willing to share information about his client because the customer turned out to be a deadbeat: The customer walked out on two months worth of rent, an outstanding debt of $1,600. The reseller also seemed willing to talk to me because I might be able bend the ear of Spamhaus.org, the anti-spam group that urged ISPs worldwide to block his Internet addresses (several thousand dollars worth of rented servers) shortly after Microsoft announced the Rustock takedown.

I found the reseller advertising his services on a Russian-language forum that caters exclusively to spammers, where he describes the hardware, software and connection speed capabilities of the very servers that he would later rent out to the Rustock botmaster. That solicitation, which was posted on a major spammer forum in January 2010, offered prospective clients flexible terms without setting too many boundaries on what they could do with the servers. A translated version of part of his message:

“I am repeating again that the servers are legitimate, funded by us and belong to our company. To the datacenters, we are responsible to ensure that you are our client, and that you will not break the terms of use. Also, to you we are responsible to make sure that the servers are not going to be closed down because of credit card chargebacks, as it happens with servers funded with stolen credit cards. In conclusion, they do not have an abuse report center, they are suitable for legitimate projects, VPNs and everything else that does not lead to problems and complaints to the data center from active Internet users. Please, take it in consideration, so that nobody is pissed off and there is no bad impression from our partnership.”

The reseller said he had no idea that his customer was using the servers to control the Rustock botnet, but he hastened to add that this particular client didn’t attract too much attention to himself. According to the reseller, the servers he resold to the Rustock botmaster generated just two abuse complaints from the Internet service providers (ISPs) that hosted those servers. Experts say this makes sense because botnet control servers typically generate few abuse complaints, because they are almost never used for the sort of activity that usually prompts abuse reports, such as sending spam or attacking others online. Instead, the servers only were used to coordinate the activities of hundreds of thousands of PCs infected with Rustock, periodically sending them program updates and new spamming instructions.

The reseller was paid for the servers from an account at WebMoney, a virtual currency similar to PayPal but more popular among Russian and Eastern European consumers. The reseller shared the unique numeric ID attached to that WebMoney account — WebMoney purse “Z166284889296.” That purse belonged to an “attested” WebMoney account, meaning that the account holder at some point had to verify his identity by presenting an official Russian passport at a WebMoney office. A former law enforcement officer involved in the Rustock investigation said the name attached to that attested account was “Vladimir Shergin.” According to the reseller, the client stated in an online chat that he was from Saint Petersburg, Russia.

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21
Mar 11

Homegrown: Rustock Botnet Fed by U.S. Firms

Aaron Wendel opened the doors of his business to some unexpected visitors on the morning of Mar. 16, 2011. The chief technology officer of Kansas City based hosting provider Wholesale Internet found that two U.S. marshals, a pair of computer forensics experts and a Microsoft lawyer had come calling, armed with papers allowing them to enter the facility and to commandeer computer hard drives and portions of the hosting firm’s network. Anyone attempting to interfere would be subject to arrest and prosecution.

Weeks earlier, Microsoft had convinced a federal judge (PDF)  to let the software giant seize control of server hard drives and reroute Internet addresses as part of a carefully timed takedown of the Rustock botnet, which had long reigned as the world’s most active spam-spewing crime machine.

In tandem with the visit to Wholesale Internet, Microsoft employees and U.S. marshals were serving similar orders at several other hosting providers at locations around country.  Microsoft’s plan of attack — which it spent about six months hatching with the help of a tightly knit group of industry and academic partners — was to stun the Rustock botnet, by disconnecting more than 100 control servers that the botnet was using to communicate with hundreds of thousands of infected Windows PCs.

Only two of the control servers were located outside the United States; the rest operated from hosting providers here in the US, many at relatively small ISPs in Middle America.

Concentrations of Rustock control networks.

Microsoft was careful not to make any accusations that hosting providers were complicit in helping the Rustock botmasters; however, some of these control servers existed for more than a year, and most likely would have continued to operate undisturbed had Microsoft and others not intervened. Using data gathered by Milpitas, Calif. based security firm FireEye, which assisted Microsoft in the takedown, I was able to plot the location and lifetime of each control server (the map above is clickable and should let you drill down to the details of each control server; the raw data is here). The average life of each controller was 251 days — a little over eight months.

Wholesale Internet’s Wendel said his organization takes action against any customers that appear to be violating the company’s terms of use or its policies. But he insisted that the visit by Microsoft and the marshals was the first time he’d heard that any of the 16 Rustock command and control servers were located on his network.

“To be perfectly honest with you, we never heard of Rustock until Wednesday,” Wendel said in a phone interview last Friday. Wendel also said he  hadn’t heard anything about the problematic servers from either Spamhaus or Shadowserver, which allow ISPs and hosting providers to receive reports about apparent botnet control servers and bot infections on their networks. Both Shadowserver and Spamhaus dispute this claim, saying that while they certainly did not alert Wholesale to all of the problem Internet addresses that it may have had on its network, they filed several reports with the company over the past six months that should have given the company cause to take a closer look at its customers and systems.

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