IRS Scam: Phishing by Fax

March 29, 2011
12 Comments

Scammers typically kick into high gear during tax season in the United States, which tends to bring with it a spike in phishing attacks that spoof the Internal Revenue Service.   Take, for example, a new scam making the rounds via email, which warns of discrepancies on the recipient’s income tax return and requests that personal information be sent via fax to a toll-free number.

A new phishing campaign that began sometime in the last 24 hours is made to look like it was sent from irs@irsonline.gov, and urges recipients to fill out, print, and fax an attached PDF tax form. From the scam email:

*This is in reference to your 2010 U.S. Individual Income Tax Return we seem to have some discrepancies with your filing. If you have already filed for your 2010  tax refund please get hold of a new form 1040 and
mail it to the  Department of the Treasury in your region.*

*If for any reason you have not yet filed for your 2010  Individual
Income Tax Return please print out the attached PDF form, fill it and
fax it to the IRS data center on (866) 513-7982 within 24 hours.*

*This has no bearing on your 2010 U.S. Individual Income Tax Return,
this to update our data and survey while we prepare to close the 2010
tax filing season.*

*Thank you *

That 866- phone number is currently returning a fast-busy signal, which suggests either that a lot of people are falling for this scam, or that anti-scammers are speed-dialing the number in a bid to prevent would-be victims from faxing in their forms. My guess is that this scam is tied to some kind of automated service that scans faxes and then emails the phishers copies of the scanned images.

It’s worth noting that the data requested in this bogus IRS form includes the Social Security number, e-File PIN and adjusted gross income, all of which are crucial pieces of information that the IRS uses to authenticate taxpayers.

The IRS has been careful to note that while it may conduct follow-up correspondence with taxpayers via email if the taxpayer chooses to communicate that way, it will never reach out to taxpayers via email. Consumers can report any tax-related phishing scams to phishing@irs.gov.

Microsoft Hunting Rustock Controllers

March 28, 2011
22 Comments

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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Big Scores and Hi-Scores

March 23, 2011
15 Comments

Business gurus have long maintained that time = $$, but that doesn’t mean that playtime necessarily decreases the bottom line. Many corporations have discovered that their employees tend to be more productive when they have time to give their brains a break, and gameplay is the perfect escape. So it’s not surprising that some cyber criminals have taken this lesson to heart, and are crafting crime machines to include games that allow their evildoing customers to steal money and set their hi-scores at the same time.

I had a laugh when I stumbled upon the administrative panel shown in the video below. It’s a back-end Web database designed to interact with a collection of Windows PCs infected by the ZeuS Trojan. This panel receives financial data stolen from victim machines, including PayPal and Bank of America account credentials. This video shows the Bank of America tab of the tool, which also allows the criminal to inject specific “challenge/response” questions into BofA’s Web page as displayed in the victim’s browser, as a way to steal the answers to these questions should the criminal later be asked for them when later logging in to victim accounts.

Directly to the right of an option to export all stolen credentials to an easy-to-read .csv file is a button labeled “Pacman”. Clicking launches a playable, exact replica of the 1980s arcade game (enlarge the video by clicking the icon in the bottom right corner of the video panel):

I can’t help but wonder whether we will witness some perverse kind of Moore’s law with future criminal Web administration panels. I can just see it now: In 18 months, crooks writing these panels will be bundling Halo 3 and Counter-Strike with their creations!

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Critical Security Updates for Adobe Acrobat, Flash, Reader

March 21, 2011
33 Comments

Adobe today released a software update to plug a critical security hole in its Flash Player, Adobe Acrobat and PDF Reader products. The patch comes a week after the software maker warned that miscreants were exploiting the Flash vulnerability to launch targeted attacks on users.

The Flash update addresses a critical vulnerability in Adobe Flash Player version 10.2.152.33 and earlier; versions (Adobe Flash Player version 10.2.154.18 and earlier versions for Chrome users) for Windows, Macintosh, Linux and Solaris operating systems; and Adobe Flash Player 10.1.106.16 and earlier versions for Android.

Adobe is urging all users to upgrade to the latest version — Flash v. 10.2.153.1 (Chrome users want v. 10.2.154.25, although Google is likely to auto-update it soon, given their past speediness in applying Flash updates). Update: According to The Register’s Dan Goodin, Google updated Chrome to patch this Flash flaw a full three days ago!

Original post: Click this link to find out what version of Flash you have installed. If something goes wrong in your update, or if you’re just a stickler for following directions, Adobe recommends uninstalling the current version of Flash before proceeding with the update (Mac users see this link).

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Homegrown: Rustock Botnet Fed by U.S. Firms

March 21, 2011
47 Comments

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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Rustock Botnet Flatlined, Spam Volumes Plummet

March 16, 2011
48 Comments

The global volume of junk e-mail sent worldwide took a massive nosedive today following what appears to be a coordinated takedown of the Rustock botnet, one of the world’s most active spam-generating machines.

Rustock spam volumes, from M86 Security Labs

For years, Rustock has been the most prolific purveyor of spam — mainly junk messages touting online pharmacies and male enhancement pills. But late Wednesday morning Eastern Time, dozens of Internet servers used to coordinate these spam campaigns ceased operating, apparently almost simultaneously.

Such an action suggests that anti-spam activists have succeeded in executing possibly the largest botnet takedown in the history of the Internet. Spam data compiled by the Composite Spam Blocklist, the entity that monitors global junk e-mail volumes for the anti-spam outfit Spamhaus.org, shows that at around 2:45 p.m. GMT (10:45 a.m. EDT) spam sent via the Rustock botnet virtually disappeared. The CBL estimates that at least 815,000 Windows computers are currently infected with Rustock, although that number is more than likely a conservative estimate.

“This is a truly dramatic drop,” said one anti-spam activist from Ottawa, Canada, who asked not to be named because he did not have permission from his employer to speak publicly about the spam activity spike. “Normally, Rustock is sending between one to two thousands e-mails per second. Today, we saw infected systems take an abrupt dive to sending about one to two emails per second.”

Joe Stewart, director of malware research with Atlanta-based Dell SecureWorks, said none of the 26 Rustock command and control networks he’s been monitoring were responding as of Wednesday afternoon.

“This looks like a widespread campaign to have either these [Internet addresses] null-routed or the abuse contacts at various ISPs have shut them down uniformly,” Stewart said. “It looks to me like someone has gone and methodically tracked these [addresses] and had them taken out one way or another.”

Update, Mar. 18, 10:04 a.m. ET: As many readers have pointed out, the Wall Street Journal is reporting that the takedown of Rustock was engineered by Microsoft, which used the legal process to shutter the botnet’s control networks at various U.S.-based hosting providers. For more on how Microsoft did that, check out my latest story, Homegrown: Rustock Botnet Fed by U.S. Firms.

Original story:

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ZeuS Innovations: ‘No-$H!+ Reports’

March 16, 2011
41 Comments

Security experts often warn computer users about “keystroke-logging” malware, digital intruders capable of recording your every keystroke. But the truth is, real bad guys don’t care about your everyday chit-chat: They’re after the financial information. I was reminded of this reality by a feature built into a recent version of the infamous ZeuS trojan that makes it even easier for the crooks to ignore everything except for the goods they’re seeking.

Pictured here is part of an administration panel for a botnet of PCs infected with the ZeuS trojan (version 2.0.8.9). ZeuS’ data-stealing components are legion, but one of its most useful features is what’s known as a “form grabber,” which will automatically steal any data the victim submits to a Web site inside of a form, such as an address, credit card number or password. It doesn’t matter if the Web site the victim is on uses encryption (https://), ZeuS extracts and stores user-submitted data before it can be encrypted and sent by the browser.

But even when a botmaster has configured his bots to only record data when the victim browses to https:// sites, the amount of data harvested from the entire botnet can easily exceed hundreds of megabytes per day, because many botnets are lifting this data from thousands of infected systems simultaneously.

So what if you only want only the cream of the crop? The ZeuS control panel I encountered has a handy feature, called “Enable No-Shit reports,” which when checked only stores very specific information sought by the criminals, such as 16-digit credit card numbers, and data that victims are submitting to pre-selected online banking sites.

Adobe: Attacks on Flash Player Flaw

March 14, 2011
24 Comments

Adobe warned today attackers are exploiting a previously unknown security flaw in all supported versions of its Flash Player software. The company said the same vulnerability exists in Adobe Reader and Acrobat, but that it hasn’t yet seen attacks targeting the flaw in those programs.

In an advisory released today, Adobe said malicious hackers were exploiting a critical security hole in Flash (up to and including the latest version of Flash. The software maker warned the vulnerability also exists in Adobe Flash player 10.2.152.33 and earlier versions for Windows, Mac, Linux and Solaris operating systems (10.2.154.13 and earlier for Chrome users), Flash Player 101.106.16 and earlier for Android. In addition, Adobe believes the bug lives in the “authplay.dll” component that ships with Adobe Reader and Acrobat X (10.0.1) and earlier 10.x and 9.x versions for Windows and Mac systems.

Adobe warns that the security hole is currently being exploited via Flash (.swf) files embedded in a Microsoft Excel document delivered as an email attachment. Why someone would need to embed a Flash file in an Excel document is anyone’s guess.

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Rogue Antivirus Via Skype Phone Call?

March 11, 2011
34 Comments

A few readers have written, saying that they recently received Skype phone calls urging them to download and install a system update for Microsoft Windows. Users who visit the recommended site are bombarded with the same old scareware prompts that try to frighten them into purchasing worthless security software.

Scareware scams are nothing new to Skype: They have spread for some time now over the instant message client built into Skype, but this is the first I’ve heard of rogue anti-virus peddlers resorting to robocalls via Skype to spread their junk software.

One quick-thinking reader managed to record the tail end of the call, which is available by clicking here. It says, “To download the patch update, request professional maintenance at www.sosgt.com.” It seems from this thread on the Skype.com user forum that a great many others are getting these rogue AV calls.

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Green Skimmers Skimming Green

March 11, 2011
30 Comments

To combat an increase in ATM fraud from skimmer devices, cash machine makers have been outfitting ATMs with a variety of anti-skimming technologies. In many cases, these anti-skimming tools take the shape of green or blue semi-transparent plastic casings that protrude from the card acceptance slot to prevent would-be thieves from easily attaching skimmers. But in a surprising number of incidents, skimmer scammers have simply crafted their creations to look exactly like the anti-skimming devices.

Earlier this year, authorities in Ireland began dealing with a rash of ATM skimmers like the one picture directly below. The green anti-skimming device is backlit and oddly-shaped, a design intended to confound skimmer makers. But as can been seen from the first picture here, the only obvious difference between a compromised ATM and an unadulterated one in this case is a small plastic lip at the top, which the crooks in this attack used to house the electronic brains for their skimmer.


The second picture below shows the underside of the skimming device, removed from a compromised machine in the background.

A representative from the Garda (Irish Police) declined to discuss the skimming photos, saying that for legal reasons they were unable to comment on ongoing court cases. But a source close to the investigation said identical skimmers have been found attached to ATMs across the country. The source said a 33-year-old Moldovan man has been arrested in Limerick in connection with the attacks, which authorities have called part of a global ATM fraud operation.

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