House Committee to Probe e-Banking Heists

May 31, 2012
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The House Financial Services Committee is slated to hold a hearing this Friday on the impact of cyber heists against small- to mid-sized businesses. It’s too bad the committee has already finalized its witness list: It likely would be shocked to hear the story of Tennessee Electric Company Inc., a firm that lost $328,000 earlier this month in an account takeover that defeated multiple security measures commonly used by commercial banks to stop cyber thieves.

Executives at the Kingsport, Tenn. based construction and maintenance contractor thought that the security procedures employed by their bank — one-time tokens and verbal approval for all transactions — would deter attackers. But they recently discovered how deftly today’s e-thieves can bypass such defenses.

The attack began sometime before May 9, when thieves stole the online banking credentials for Tennessee Electric, presumably with some type of malicious software such as the ZeuS Trojan. That morning, the company’s controller Jenni Smith logged into the firm’s account at the Web site of Tri-Summit Bank, entering her password and a one-time password generated by a key fob supplied by the bank. After Smith entered the information, however, her browser was redirected to a Web page stating that the bank’s site was down for maintenance and would be offline for about an hour.

But the thieves lurking on Smith’s PC intercepted that one-time password, used her connection to log on to the bank’s site, and redirected her browser to the fake maintenance page. Meanwhile, the attackers used that browser session to put through a batch of fraudulent payroll payments to at least 50 “money mules,” willing or unwitting individuals scattered throughout the United States who were recruited to help the crooks funnel the funds out of the country.

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White House Aims to Stoke Botnet Fight

May 29, 2012
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The Obama administration will hold a public meeting at the White House on Wednesday to discuss industry and government efforts to combat botnet activity. Among those is a pilot program to share information about botnet victims between banks and Internet service providers, according to sources familiar with the event.

The gathering will draw officials from The White House, US Department of Commerce and Department of Homeland Security, as well as private-sector executives from an entity formed in February called the Industry Botnet Group. The IBG counts among its members trade associations, companies and privacy organizations that are working to create a voluntary model that ISPs can use to notify customers with infected computers.

Although a number of ISPs already notify customers of bot infections, there is no uniform method for reporting these events. Attendees at Wednesday’s meeting are expected to announce — among other things — an information sharing pilot between ISPs and financial institutions that are part of the Financial Services Information Sharing and Analysis Center, an industry consortium dedicated to disseminating data on cyber threats facing banks.

The pilot to be announced this week will draw on a nascent extension of IODEF, an Internet standard developed by the Anti-Phishing Working Group to share data about phishing attacks in a common format that can be processed automatically and across multiple languages. Continue reading →

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WHMCS Breach May Be Only Tip of the Trouble

May 24, 2012
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A recent breach at billing and support software provider WHMCS that exposed a half million customer usernames, passwords — and in some cases credit cards — may turn out to be the least of the company’s worries. According to information obtained by KrebsOnSecurity.com, for the past four months hackers have been selling an exclusive zero-day flaw that they claim lets intruders break into Web hosting firms that rely on the software.

WHMCS is a suite of billing and support software used mainly by Web hosting providers. Following an extended period of downtime on Monday, the privately-owned British software firm disclosed that hackers had broken in and stolen 1.7 gigabytes worth of customer data, and deleted a backlog of orders, tickets and other files from the firm’s server.

The company’s founder, Matt Pugh, posted a statement saying the firm had fallen victim to a social engineering attack in which a miscreant was able to impersonate Pugh to WHMCS’s own Web hosting provider, and trick the provider into giving up the WHMCS’s administrative credentials.

“Following an initial investigation I can report that what occurred today was the result of a social engineering attack,” Pugh wrote. “The person was able to impersonate myself with our web hosting company, and provide correct answers to their verification questions. And thereby gain access to our client account with the host, and ultimately change the email and then request a mailing of the access details.”

Meanwhile, WHMCS’s user forums have been and remain under a constant denial-of-service attack, and the company is urging customers to change their passwords.

As bad as things are right now for WHMCS, this rather public incident may be only part of the company’s security woes. For several years, I have been an unwelcome guest on an exclusive underground forum that I consider one of the few remaining and clueful hacking forums on the Underweb today. I’ve been kicked out of it several times, which is why I’m not posting any forum screenshots here.

Update, May 29, 12:35 p.m. ET: WHMCS just issued a patch to fix an SQL injection vulnerability that may be related to this 0day. See this thread from Pugh for more information.

Original post:

In February, a trusted and verified member of that forum posted a thread titled,” WHMCS 0-day,” saying he was selling a previously undocumented and unfixed critical security vulnerability in all version of WHMCS that provides direct access to the administrator’s password. From that hacker’s sales thread [link added]:

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Google to Warn 500,000+ of DNS Changer Infections

May 22, 2012
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Google plans today to begin warning Internet users if their computers show telltale signs of being infected with the DNSChanger Trojan. The company estimates that more than 500,000 systems remain infected with the malware, despite a looming deadline that threatens to quarantine the sick computers from the rest of the Internet.

Security experts won court approval last year to seize control of the infrastucture that powered the search-hijacking Trojan in a bid to help users clean up infections. But a court-imposed deadline to power down that infrastructure will sever Internet access for PCs that are not rid of the malware before July 9, 2012.

Google plans to serve this warning to more than 500,000 users to warn them of infections from the DNSChanger Trojan

The company said the warning (pictured above) will appear only when a user with an infected system visits a Google search results property (google.com, google.co.uk, etc.), and will include the message, “Your computer appears to be infected.” Google security engineer Damian Menscher said the company expects to notify approximately a half-million users in the first week of the notices.

“In general we want to notify users [of malware infections] anytime we are capable of doing so, but the fact that we don’t do this more often is really just because it’s hard to come across cases where we can do it this accurately,” Menscher said.  “In many cases we only have maybe a 90 percent confidence that someone is infected, and the false positive rate of 10 percent is simply too high to be feasible. But in this case we can be essentially certain that someone is infected.”

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Adware Stages Comeback Via Browser Extensions

May 21, 2012
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The Wikimedia Foundation last week warned that readers who are seeing ads on Wikipedia articles are likely using a Web browser that has been infected with malware. The warning points to an apparent resurgence in adware and spyware that is being delivered via cleverly disguised browser extensions designed to run across multiple Web browsers and operating systems.

An ad served by IWantThis! browser extension. Source: Wikimedia

In a posting on its blog, Wikimedia noted that although the nonprofit organization is funded by more than a million donors and does not run ads, some users were complaining of seeing ads on Wikipedia entries. “If you’re seeing advertisements for a for-profit industry (see screenshot below for an example) or anything but our fundraiser, then your web browser has likely been infected with malware,” reads a blog post co-written by Philippe Beaudette, director of community advocacy at the Wikimedia Foundation.

The blog post named one example of a browser extension called “IWantThis!,” which is essentially spyware masquerading as adware. The description at the IWantThis! Web site makes it sound like a harmless plugin that occasionally overlays ads on third-party Web sites and helps users share product or online shopping wish lists with others. As I was researching this extension, I came across this helpful description of it at the DeleteMalware Blog, which points to the broad privacy policy that ships with this extension:

Examples of the information we may collect and analyze when you use our website include the IP address used to connect your computer to the Internet; login; e-mail address; password; computer and connection information such as browser type, version, and time zone setting, browser plug-in types and versions, operating system, and platform; the full Uniform Resource Locator (URL) clickstream to, through, and from the Site, including date and time; cookie; web pages you viewed or searched for; and the phone number you used to call us. Continue reading →

Global Payments Breach Now Dates Back to Jan. 2011

May 17, 2012
28 Comments

The data breach at Atlanta-based credit and debit card processor Global Payments just keeps getting bigger. Earlier this month, I reported that Visa and MasterCard were alerting banks that the breach extended back to June 2011. Now it appears the breach jeopardized cards processed by Global as far back as January 2011.

The latest disclosure, detailed in a story at BankInfoSecurity.com, now aligns with the timeline outlined by anonymous hackers who reached out to me after I broke the story on this breach back at the end of March. Global has disclosed relatively little about the breach, and has sought to downplay the severity of it. Initial reports suggested that more than 10 million card accounts were compromised in the breach, yet Global insists fewer than 1.5 million were taken. Recent reports by The Wall Street Journal put that figure closer to 7 million stolen card accounts.

Shortly after the breach, Global executives were complaining about “rumor and innuendo” in press reports about the incident. I borrowed that quote for the title of a follow-up blog post, which included claims from a hacker who told me he was reaching out because he felt Global was hiding the true extent of the breach. He told me that he was part of a group that had been inside of Global since just after the new year in 2011. From that story:

The hacker said the company’s network was under full criminal control from that time until March 26, 2012. “The data and quantities that was gathered [was] much more than they writed [sic]. They finished End2End encryption, but E2E not a full solution; it only defend [sic] from outside threats.” He went on to claim that hackers had been capturing data from the company’s network for the past 13 months — collecting the data monthly — gathering data on a total of 24 million unique transactions before they were shut out.

Global has refused to comment further on the incident, referring people to a Web site with a series of Q&As for various parties potentially impacted by the breach. I guess only time will tell whether the hackers were right about the number of compromised transactions as well.

Facebook Takes Aim at Cross-Browser ‘LilyJade’ Worm

May 17, 2012
42 Comments

Facebook is attempting to nip in the bud a new social networking worm that spreads via an application built to run seamlessly as a plugin across multiple browsers and operating systems. In an odd twist, the author of the program is doing little to hide his identity, and claims that his “users” actually gain a security benefit from installing the software.

At issue is a program that the author calls “LilyJade,” a browser plugin that uses Crossrider, an emerging programming framework designed to simplify the process of writing plugins that will run on Google Chrome, Internet Explorer, and Mozilla Firefox.  The plugin spreads by posting a link to a video on a user’s Facebook wall, and friends who follow the link are told they need to accept the installation of the plugin in order to view the video. Users who install LilyJade will have their accounts modified to periodically post links that help pimp the program.

The goal of LilyJade is to substitute code that specifies who should get paid when users click on ads that run on top Internet properties, such as Facebook.com, Yahoo.com, Youtube.com, Bing.com, Google.com and MSN.com. In short, the plugin allows customers to swap in their own ads on virtually any site that users visit.

I first read about LilyJade in an analysis published earlier this month by Russian security firm Kaspersky Labs, and quickly recognized the background from the screenshot included in that writeup as belonging to user from hackforums.net. This is a relatively open online hacking community that is often derided by more elite and established underground forums because it has more than its share of adolescent, novice hackers (a.k.a. “script kiddies”) who are eager to break onto the scene, impress peers, and make money.

It turns out that the Hackforums user who is selling this plugin is doing so openly using his real name. Phoenix, Ariz. based hacker Dru Mundorff sells the LilyJade plugin for $1,000 to fellow Hackforums members. Mundorff, 29, says he isn’t worried about the legalities of his offering; he’s even had his attorney sign off on the terms of service that each user is required to agree to before installing it.

“We’re not forcing any users to be bypassed, exploited or anything like that,” Mundorff said in a phone interview.  “At that point, if they do agree, it will allow us to make posts on their wall through our system.”

Mundorff claims his software is actually a benefit to Facebook and the Internet community at large because it is designed to also remove infections from some of the more popular bot and Trojan programs currently for sale on Hackforums, including Darkcomet, Cybergate, Blackshades and Andromeda (the latter being a competitor to the password-stealing ZeuS Trojan that hides behind Facebook comments). Mundorff maintains that his plugin will result in a positive experience for the average Facebook user, although he acknowledges that customers who purchase LilyJade can modify at will the link that “users” are forced to spread, and may at any time swap in links to malware or exploit sites. Continue reading →

Multiple Human Rights, Foreign Policy Sites Hacked

May 15, 2012
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A rash of recent and ongoing targeted attacks involving compromises at high-profile Web sites should serve as a sobering reminder of the need to be vigilant about applying browser updates. Hackers have hit a number of prominent foreign policy and human rights group Web sites, configuring them to serve spyware by exploiting newly patched flaws in widely used software from Adobe and Oracle.

The latest reports of this apparent cyberspy activity come from security experts at Shadowserver.org, a nonprofit that tracks malware attacks typically associated with so-called “advanced persistent threat” (APT) actors. APT is a controversial term that means many things to different folks, but even detractors of the acronym’s overuse acknowledge that it has become a useful shorthand for “We’re pretty sure it came from China.”

A diagram depicting the (since-cleaned) attack on the Website of the Center for Defense Information.

One look at the list of the sites found to be currently serving an exploit to attack a newly-patched Adobe Flash Player vulnerability (CVE-2012-0779) shows how that shorthand is earned. Shadowserver uncovered Flash exploits waiting for visitors of the Web sites for Amnesty International Hong Kong and the Center for Defense Information, a Washington, D.C. think-tank. The home page for the International Institute for Counter-Terrorism was found to be serving up malware via a recent Oracle Java vulnerability (CVE-2012-0507), while the Cambodian Ministry of Foreign Affairs site was pointing to both Flash and Java exploits.

“In recent months we have continued to observe 0-day vulnerabilities emerging following discovery of their use in the wild to conduct cyber espionage attacks,” wrote Shadowserver volunteers Steven Adair and Ned Moran, in a blog post about the attacks, which they dubbed “strategic Web compromises.”

“Frequently by the time a patch is released for the vulnerabilities, the exploit has already been the wild for multiple weeks or months — giving the attackers a very large leg up,” they wrote. “The goal is not large-scale malware distribution through mass compromises. Instead the attackers place their exploit code on websites that cater towards a particular set of visitors that they might be interested in.”

The discoveries come just days after security vendor Websense found that the site for Amnesty International United Kingdom (AIUK)  was hosting the same Java exploit. According to Shadowserver, other sites that were compromised by remarkably similar attacks but since cleaned include those belonging to the American Research Center in Egypt, the Institute for National Security Studies, and the Center for European Policy Studies.

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Global Payments Breach Fueled Prepaid Card Fraud

May 14, 2012
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Debit card accounts stolen in a recent hacker break-in at card processor Global Payments have been showing up in fraud incidents at retailers in Las Vegas and elsewhere, according to officials from one bank impacted by the fraud.

At the beginning of March 2012, Danbury, Conn. based Union Savings Bank began seeing an unusual pattern of fraud on a dozen or so debit cards it had issued, noting that most of the cards had recently been used in the same cafe at a nearby private school. When the bank determined that the school was a customer of Global Payments, it contacted Visa to alert the card association of a possible breach at the Atlanta-based processor, according to Doug Fuller, Union Savings Bank’s chief risk officer.

That’s when USB heard from Tony Higgins, then a fraud investigator at Vons, a grocery chain in Southern California and Nevada owned by Safeway Inc.

According to Fuller, Higgins said the fraudsters were coming to the stores to buy low-denomination Safeway branded prepaid cards, and then encoding debit card accounts issued by USB onto the magnetic stripe on the backs of the prepaid cards. The thieves then used those cards to purchase additional prepaid cards with much higher values, which were then used to buy electronics and other high-priced goods from other retailers.

“Higgins said, ‘You have a problem,'” Fuller recalled, of a phone conversation the bank had with Higgins in early March. “He said he had a slew of these people going through their Vons and Safeway stores exchanging cards. He had them on surveillance tape, knew where they were from and everything.”

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FBI: Updates Over Public ‘Net Access = Bad Idea

May 11, 2012
21 Comments

The Federal Bureau of Investigation is advising travelers to avoid updating software while using hotel or other public Internet connections, warning that malicious actors are targeting travelers abroad through pop-up windows while they are establishing an Internet connection in their hotel rooms.

From the FBI’s advisory:

“Recently, there have been instances of travelers’ laptops being infected with malicious software while using hotel Internet connections. In these instances, the traveler was attempting to set up the hotel room Internet connection and was presented with a pop-up window notifying the user to update a widely used software product. If the user clicked to accept and install the update, malicious software was installed on the laptop. The pop-up window appeared to be offering a routine update to a legitimate software product for which updates are frequently available.”

The warning is a good opportunity to revisit some wireless safety tips I’ve doled out over the years. Avoid updating software while you’re using networks that are untrusted and public, whether they are wired or wireless. This generally means Wi-Fi networks like those available in hotels and coffee shops, and even wired connections at hotels. The only exception I make to this rule is when I have a device that is tethered to the 3G connection on a mobile phone. But even this can be dicey, because many laptops and mobile devices will switch over to available Wi-Fi networks in the event that the 3G signal dies.

There are a number of free attack tools that can be used to spoof software update prompts, and these are especially effective against users on small local networks. Bear in mind that false update prompts don’t have to involve pop-ups. I’ve written at least two blog posts about EvilGrade, a toolkit that makes it simple for attackers to install malicious software by exploiting weaknesses in the auto-update feature of many popular software titles. The deviousness of this tool is that it can be used to hijack the legitimate updaters built into software already installed on your computer.

If you must update while on the road, make sure that you initiate the update process. Avoid clicking pop-up prompts or anything that looks like it was launched from an auto-updater. When in doubt, always update from the vendor’s Web site. Most importantly — and Rule #1 of Krebs’s 3 Basic Rules for Online Safety covers this nicely — “if you didn’t go looking for it, don’t install it!” Also, using an update tracker, such as Secunia‘s Personal Software Inspector or File Hippo‘s Update Checker, can help you stay on top of the latest security patches for widely-used software, and make it easier for you to plan your software updates ahead of time.