October, 2010

Oct 10

Earn a Diploma from Scam U

Since the dawn of the Internet, tutorials showing would-be scammers how to fleece others have been available online. But for novices who can’t be bothered to scour the Net for these far flung but free resources, the tricks of the trade now can be learned through the equivalent of community college classes in e-thievery, or or via intensive, one-on-one online apprenticeships.

Take the program currently being marketed on several fraud forums — it’s called Cash Paradise University (see screen shot below). For $50, a newbie scammer can learn the basics of online fraud, such as hiding one’s identity and location online, and how to obtain reliable stolen credit card numbers. For a $75 fee and an investment of about 2 to 3 hours, one can become fluent in the ways of “Skype carding,” or selling hacked and newly-created Skype accounts that have been loaded with funds from stolen credit cards.

The prices go up as the fledgling fraudster progresses from the Scam 101 courses to the more crafty classes, which naturally depend on the earlier courses as prerequisites (“for those who passed the basic,” admonishes the Scam U. professor). Learning the basics of “carding” merchandise — such as intercepting the shipments and selling the loot online — requires an investment of four to six hours and at least $250, with course materials adding as much as $150 to the cost of the class.

Tackling the tenets of cashing out stolen credit card numbers using Internet gambling sites could take up to seven hours of study time and require a $300 admittance fee. The master class — learning how to bootstrap and build out a botnet of computers infected with the ZeuS Trojan — can take upwards of 18 hours of classroom instruction, and cost at least $500 (although a copy of ZeuS bot builder is not included in the price of tuition!).

According to this fraud instructor’s profile on a top scammer forum, more than a dozen novice hackers have already paid for and progressed through the course work, and most appear to be giving their teacher high marks.

“Please note: due to change in the place of stay, I’ll be offline on 12-13 September,” the headmaster of CPU says to potential new students. “Classes take place from September 14, do not waste! Good luck in business.” For those ADHD students who need more individual attention, there is private tutoring available starting at $20 extra per class.

But don’t count paying for the classes with a (stolen?) credit card: This institution only accepts irreversible forms of payment, such as Western Union or virtual currencies like WebMoney and Liberty Reserve.


Have you seen:

I’ll Take Two MasterCards and a Visa, Please…When you’re shopping for stolen credit and debit cards online, there are so many choices these days. A glut of stolen data — combined with innovation and cutthroat competition among vendors — is conspiring to keep prices for stolen account numbers exceptionally low. Even so, many readers probably have no idea that their credit card information is worth only about $1.50 on the black market.


Oct 10

Cyber Deterrence Group Urges Greater Disclosure, Transparency

A group tasked with devising strategies to deter cyber attacks is calling for mandatory public disclosure of fraud and hacking incidents by governments and organizations of all sizes, including banks.

The recommendations were a major thrust of a report issued earlier this month by the National Research Council, which was asked to examine the issue by the Office of the Director of National Intelligence. The 400-page document is actually well worth the time to read, or at least skim. The bulk of the paper addresses how solving the problems associated with cyber crime requires aligning incentives and liabilities so that those in the best position to fix the problems have an incentive to do so.

But to me, the most interesting and useful components of the report come at the end, where the group makes several broad policy recommendations, including:

  • Mitigating malware infections via ISPs by subsidized cleanup
  • Mandatory disclosure of fraud losses and security incidents
  • Mandatory disclosure of industrial control system incidents and intrusions
  • Aggregating reports of cyber espionage and reporting to the World Trade Organization

I don’t know how effective or realistic the last two recommendations would be, but as a reporter I’m naturally inclined toward disclosing data whenever possible. Loyal readers no doubt know where I stand on the first two points. I have long called for some kind of system in which ISPs are encouraged or given incentives to regularly scrub their networks for bot-infested customers and compromised Web sites.

And hardly a month goes by when I don’t hear from someone asking me where to find aggregated statistics on the costs of cybercrime and Internet banking fraud in the United States. The banks don’t have to publish reports of their losses, and although they are supposed to publish indicators of fraud (through suspicious activity reports) financial institutions seem to be spotty and begrudging about this level of reporting as well. Writing for SC Magazine earlier this summer, Charles Jeter of security software maker ESET penned a useful three part series on the lack of reporting by banks about the costs of online banking Trojans.

The free report is available at this link.

Speaking of global trends in cybercrime, Microsoft published its biannual Security Intelligence Report covering cybercrime activity it has observed in the first half of 2010. Anyone looking for granular data on which threats are most prevalent (at least from Microsoft’s perspective in scrubbing millions of PCs) should have a look at this informative report. Unsurprisingly, the United States (or more accurately — US-based ISPs) continues to lead the world in botnet infections.

While we’re on the subject of data breach and attack disclosure, now seems like a perfect time to mention that Arbor Networks is seeking additional perspective for its annual Worldwide Infrastructure Security Threat Report. Arbor is looking for a few clueful network administrators to anonymously share experiences and perspectives about operational risks and challenges involved in building, operating and defending large networks. If this describes you, check out their survey.

Oct 10

ZeuS Busts Bring Botnet Beatdown?

Authorities in the United States, United Kingdom and Ukraine launched a series of law enforcement sweeps beginning late last month against some of the world’s most notorious gangs running botnets powered by ZeuS, a powerful password-stealing Trojan horse program. ZeuS botnet activity worldwide took a major hit almost immediately thereafter, but it appears to be already on the rebound, according to one prominent ZeuS-watching site.

Statistics collected by the Web site Zeus Tracker indicate that while ZeuS botnet activity was already on the wane in the weeks leading up to the end of last month, that activity positively tanked following the recent busts, dipping to its lowest level since the Troyak takedowns earlier this year. For instance, prior to the arrests that began on Sept 29, Zeus Tracker was tracking more than 90 active Zeus control domains. By Oct. 3, that number had fallen to just 20.

I contacted Roman Hüssy, the Swiss information technology expert who maintains the tracking site, to see if there could be some technical or glitchy explanation for the dramatic drop. Hüssy said while there are criminal technologies being built into malware that try to prevent ZeuS Tracker from being able to follow ZeuS botnet infrastructure, he’s fairly sure he has managed to bypass it.

“Another thing which I’ve seen is that some [ZeuS botnet command servers] are using geo-IP location, [so that] if a ZeuS group just targets U.K. banks, they will do a geo-location restriction on the [control] server, and allow just bots from the U.K.” to ping the servers, he wrote in an instant message.

Some folks who probably know more about what’s really going on here (targeted takedowns, maybe?) aren’t responding at the moment, which tells me we may hear more about other factors that contributed to this drop in the days or weeks ahead. Stay tuned.

Oct 10

Pill Gang Used Microsoft’s Network in Attack on KrebsOnSecurity.com

An organized cyber crime gang known for aggressively pushing male enhancement drugs and other knockoff pharmaceuticals used Internet addresses belonging to Microsoft as part of a massive denial-of-service attack against KrebsOnSecurity.com late last month.

The attack on my Web site happened on Sept. 23, roughly 24 hours after I published a story about a criminal online service that brazenly sold stolen credit card numbers for less than $2 each (see: I’ll Take Two MasterCards and a Visa, Please). That story got picked up by BoingBoing, Gizmodo, NPR and a variety of other sites, public attention that no doubt played a part in the near-immediate suspension of that criminal Web site.

At first, it wasn’t clear what was behind the attack, which at one point caused a flood of traffic averaging 2.3 gigabits of junk data per second (see graph above). Not long after the attack ended, I heard from Raymond Dijkxhoorn and Jeff Chan, co-founders of SURBL, which maintains a list of Web sites that have appeared in spam. Chan sent me a message saying he had tracked the attack back to several Internet addresses, including at least one that appeared to be located on Microsoft’s network —

According to SURBL, the culprits were botnets under the thumb of “the usual Russian pill gangs”: Dozens of domains that resolve(d) to online pharmacy sites — including bridgetthefidget.com, crazygraze.com, firstgang.com, triplefixes.com and philsgangdirect.com — were using a compromised machine at that Microsoft address as a domain name server.

The attackers then told machines they controlled to access a number of non-existent pages at sites that were pointing to the Internet address my hosting provider has assigned to KrebsOnSecurity.com ( This forced several hundred or thousand machines to direct their traffic at my site, all in an attempt to prevent legitimate visitors from visiting it.

For example, the attack packets included DNS for false requests such as:

mzkzalczdznzjzfbszvzazd.jumpgirlsaloud.nl A

sdfsdfsdfsdfsdffbszvzazd.youralveolarbone.nl A

zzncmzkzalczdznzjzfbszvzazd.cheapxenonbulbs.com A

zzncmzkzalczdznzjzfbszvzazd.expletivedirect.com A

I found the unusual method of attack interesting because it called attention to a significant amount of infrastructure used by the bad guys. For all I know, this may have been intentional, either to let me know who was responsible, or to make me think I knew who was responsible.

Continue reading →

Oct 10

Java Update Clobbers 29 Security Flaws

Oracle today released a critical update to its widely-installed Java software, fixing at least 29 security vulnerabilities in the program.

Most consumers on Microsoft Windows PCs will have some version of Java installed (if you’re not sure whether you have Java or what version might be installed, click this link). Existing users can grab the latest version — Java 6 Update 22 — by visiting the Windows Control Panel, clicking on the Java icon, and then selecting the “Update Now” button on the “Update” tab. If you don’t already have this software, I recommend that you keep it that way.

Per Oracle’s advisory, updates are available for Windows, Solaris and Linux versions of Java. Apple maintains its own version of Java for OS X systems, and typically issues fixes for its version several months after the official Java release.

Be aware that Java’s updater may by default also include free “extras” that you may not want, such as the Yahoo! Toolbar or whatever other moneymaker they decide to bundle with their software this time around, so be sure to de-select that check box during installation if you don’t want the add-ons.

Oct 10

Microsoft Plugs a Record 49 Security Holes

Microsoft today issued 16 update bundles to fix a record-breaking 49 separate security vulnerabilities in computers powered by its Windows operating systems and other software.

“Microsoft has broken several of its own Patch Tuesday records this year, but this month far surpasses them all,” said Joshua Talbot, security intelligence manager, Symantec Security Response. “Perhaps most notable this month is the number of vulnerabilities that facilitate remote code execution. By our count, 35 of the issues fall into this category. These are bugs that could allow an attacker to run any command they wish on vulnerable machines.”

McAfee notes that today’s release exceeds the previous record of 34 vulnerabilities fixed in one go, which was first set in October 2009, and again in June and August of this year.

Microsoft said at least eight of the vulnerabilities were publicly disclosed prior to the release of today’s patches. The software giant also fixed one of the two remaining zero-day flaws exploited by the Stuxnet worm, a complex family of malware pegged by researchers as a weapon built to attack industrial control systems embedded in facilities like power and chemical manufacturing plants.

At the top of the critical list is an update for Internet Explorer versions 6 through 8 that plugs at least 10 security holes in the default Web browser on Windows, including two flaws that were disclosed previously. Several of the IE flaws are marked critical even on the latest versions of Microsoft’s products, including IE8 running on Windows 7 systems.

Two updates for versions of Microsoft Word and Excel comprise about half of the vulnerabilities addressed in today’s release.

Today’s fixes are available through Windows Update or by enabling Automatic Update in Windows. As always, if you experience any glitches or problems applying these patches, please drop a note in the comments section.

For more information on the patches, check out SANS Internet Storm Center‘s Black Tuesday roundup, as well as Microsoft’s Security Research & Defense blog.

Update, 3:58 p.m. ET: Several readers have pointed out that Microsoft took the momentous step today of adding detection for the infamous ZeuS Trojan to its Malicious Software Removal Tool. The MSRT is offered alongside Windows updates and if approved will scan host computers once a month for a variety of the most prevalent threats. It will be interesting to chart the impact of this welcome move by Microsoft.

Oct 10

Java: A Gift to Exploit Pack Makers

I have long urged readers who have no need for Java to remove the program, because failing to keep this software updated with the latest security patches exposes users to dangerous, ubiquitous attacks. In this blog post, I’ll show readers how attacks against Java vulnerabilities have fast emerged as the top moneymaker for authors of the best-selling “exploit kits,” commercial crimeware designed to be stitched into hacked or malicious sites and exploit a variety of Web-browser vulnerabilities.

Take one look at the newest kit on the block — “Blackhole” — and it is obvious that Java vulnerabilities continue to give attackers the most mileage and profit, and have surpassed Adobe flaws as the most successful exploit vehicles.

I spoke briefly via instant message with the developer of this Blackhole kit (pictured at right), and he assured me that these images were taken from a working installation. The screen shot here shows the administration panel for this exploit pack, which lists the number of hits (хиты) and downloads (загрузки). The statistics show that on average this kit finds a working exploit that it can use to install malicious software on a visiting host about 10 percent of the time.

Granted, as exploit pack administration pages go, this one is very young (13,289 hits at the time this screen shot was taken), but already some patterns emerge from the data. For example, we can see that Java vulnerabilities are by far the most useful, comprising more than 90 percent of all successful exploits.

This pattern is not confined to Blackhole. Have a look at the following three screen shots, taken from the exploit results pages of three different working installations of SEO Sploit Pack, another common exploit kit. All three screen shots clearly show Java vulnerabilities are the most productive, accounting for between 50 and 65 percent of malware installs or “loads” (thanks to Malwaredomainlist.com for help on this).

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Oct 10

Bill Would Give Cities, Towns and Schools Same e-Banking Security Guarantees as Consumers

In response to a series of costly online banking heists perpetrated against towns, cities and school districts, Sen. Charles Schumer (D-NY) has introduced legislation that would extend those entities the same protections afforded to consumers who are victims of e-banking fraud.

Under “Regulation E” of the Electronic Funds Transfer Act (EFTA) consumers are not liable for financial losses due to fraud — including account takeovers due to lost or stolen usernames and passwords — if they promptly report the unauthorized activity. However, entities that experience similar fraud with a commercial or business banking account do not enjoy the same protections and often are forced to absorb the losses. Organized cyber thieves, meanwhile, have stolen more than $70 million from small to mid-sized businesses, nonprofits, towns and cities, according to the FBI.

On Sept. 29, computer crooks stole $600,000 from the coastal town of Brigantine, N.J.; seven months earlier, computer crooks stole $100,000 from Egg Harbor Township just 20 miles away. In late December 2009, an organized cyber gang took $3.8 million from the Duanesburg Central School District in Schumer’s home state. In that attack, the bank managed to retrieve some of the money, but the district is still missing roughly $500,000.

The same day as the Brigantine breach, Schumer introduced S. 3898, a bill that would extend EFTA’s Regulation E protections to certain local government entities, including municipalities and school districts. The Board of Governors of the Federal Reserve System is to define which entities are included in the categories of “municipality” and “school district.”

Steve Verdier, executive vice president and director of congressional affairs for the Independent Community Bankers of America, said the thinking behind the current law is that banks can absorb the losses from this type of fraud when it happens to consumers because there is usually a comparatively smaller amount of money involved.

“The bank is probably in no better position to protect against this type of fraud than the [business] account holder,” Verdier said. “Whereas consumers may not be as good a position to protect themselves against these types of losses, you would hope a government or school district would have employee procedures to guard against this type of thing. And if the bank is forced to start making good on these losses, that weakens its ability to serve consumers and they’re going to have to price that risk into all of their services.”

Avivah Litan, a financial fraud analyst with Gartner Inc., said there are a number of promising new technologies that banks can make available to their customers that help guard against these attacks, referring to several products that use specially encoded USB keys to load a virtual operating system on the customers computer and encrypt the keystrokes between the bank and the customer.

“Also, why limit this to schools and municipalities? Small businesses have just as much risk as school districts, as do churches for that matter,” Litan said. “So does that mean that small businesses have more resources to deal with this type of fraud than cities and counties do?”

There isn’t much — if any — likelihood that the bill will be acted upon before the November elections, in which case Schumer will need to reintroduce the bill when the 112th Congress convenes early next year.

A copy of Schumer’s bill is here (PDF).

Oct 10

FCC May Confront ISPs on Bot, Malware Scourge

The Federal Communications Commissions (FCC) may soon kickstart a number of new initiatives to encourage Internet service providers to do a better job cleaning up bot-infected PCs and malicious Web sites on their networks, KrebsOnSecurity has learned.

Earlier this year, the commission requested public comment on its “Cybersecurity Roadmap,” an ambitious plan to identify dangerous vulnerabilities in the Internet infrastructure, as well as threats to consumers, businesses and governments. Twice over the past few weeks I had an opportunity to chat with Jeffery Goldthorp, associate bureau chief of the FCC’s Public Safety & Homeland Security Bureau, about some of the ideas the commission is considering for inclusion in the final roadmap, due to be released in January 2011.

Goldthorp said there are several things that the commission can do to create incentives for ISPs to act more vigorously to protect residential users from infections by bot programs.

“Along those lines would be something like an ISP ‘code of conduct’ and best practice-oriented approach that ISPs could opt-in to or not, basically a standard of behavior for ISPs to follow when they find that a user of theirs has been infected,” Goldthorp said. “The goal of that would be to clean up the consumer and residential networks. We’re also very interested in trying to figure out if there are rules we have on our books that stand in the way of ISPs being more proactive and creating a safer environment for consumers online.”

In addition, Goldthorp said the FCC is considering ways to encourage ISPs to be more proactive in dealing with malicious Web sites.

“At the server level, we’re looking at doing things that would allow us in an operational role to apply our jurisdiction with ISPs and try to reduce the time to remediation of things like malicious hosts and phishing or spam sites,” he said. “That’s really an area that [the FCC is] doing nothing in right now. We don’t get any information now about what those sites are and what we could do about them. So, we expect that there will be specific things we’d propose on all those areas of the roadmap.”

Prompted in part by the FCC’s request for comment, I wrote a column for CSO Online last month in which I called on the commission to begin measuring the responsiveness of ISPs in quashing malicious threats that take up residence on their networks. One of the ways I suggested the commission could do that is by publishing data about badness on these networks – data that is already being collected by a myriad of mostly volunteer-led groups that monitor this type of activity.

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Oct 10

Reader, Acrobat Patches Plug 23 Security Holes

A new security update from Adobe plugs at least 23 security holes in its PDF Reader and Acrobat software, including two vulnerabilities that attackers are actively exploiting to break into computers.

Adobe is urging Reader and Acrobat users of versions 9.3.4 and earlier for Windows, Mac and UNIX systems to upgrade to version 9.4 (Adobe says those who can’t upgrade to the 9.x version should instead apply the version 8.2.5 update).

Adobe says one of the 23 flaws fixed by this new version is being actively exploited. A second zero-day flaw corrected by today’s update — a critical vulnerability in Adobe Flash player that the company fixed in a separate update last month for the stand-alone Flash player — also exists in Adobe Acrobat and Reader, although Adobe says it is not aware of any attacks exploiting this flaw in those products yet.

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