Tracing Spam: Diet Pills from Beltway Bandits

April 19, 2017
63 Comments

Reading junk spam messages isn’t exactly my idea of a good time, but sometimes fun can be had when you take a moment to check who really sent the email. Here’s the simple story of how a recent spam email advertising celebrity “diet pills” was traced back to a Washington, D.C.-area defense contractor that builds tactical communications systems for the U.S. military and intelligence communities.

atballYour average spam email can contain a great deal of information about the systems used to blast junk email. If you’re lucky, it may even offer insight into the organization that owns the networked resources (computers, mobile devices) which have been hacked for use in sending or relaying junk messages.

Earlier this month, anti-spam activist and expert Ron Guilmette found himself poring over the “headers” for a spam message that set off a curious alert. “Headers” are the usually unseen addressing and routing details that accompany each message. They’re generally unseen because they’re hidden unless you know how and where to look for them.

Let’s take the headers from this particular email — from April 12, 2017 — as an example. To the uninitiated, email headers may seem like an overwhelming dump of information. But there really are only a few things we’re interested in here (Guilmette’s actual email address has been modified to “ronsdomain.example.com” in the otherwise unaltered spam message headers below): Continue reading →

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InterContinental Hotel Chain Breach Expands

April 18, 2017
35 Comments

In December 2016, KrebsOnSecurity broke the news that fraud experts at various banks were seeing a pattern suggesting a widespread credit card breach across some 5,000 hotels worldwide owned by InterContinental Hotels Group (IHG). In February, IHG acknowledged a breach but said it appeared to involve only a dozen properties. Now, IHG has released data showing that cash registers at more than 1,000 of its properties were compromised with malicious software designed to siphon customer debit and credit card data.

An Intercontinental hotel in New York City.

An Intercontinental hotel in New York City.

Headquartered in Denham, U.K., IHG operates more than 5,000 hotels across nearly 100 countries. The company’s dozen brands include Holiday Inn, Holiday Inn Express, InterContinental, Kimpton Hotels, and Crowne Plaza.

According to a statement released by IHG, the investigation “identified signs of the operation of malware designed to access payment card data from cards used onsite at front desks at certain IHG-branded franchise hotel locations between September 29, 2016 and December 29, 2016.”

IHG didn’t say how many properties total were affected, although it has published a state-by-state lookup tool available here. I counted 28 in my hometown state of Virginia alone, California more than double that; Alabama almost the same number as Virginia. So north of 1,000 locations nationwide seems very likely.

Update, April 19, 11:09 a.m. ET: Danish geek Christian Sonne writes that his research on the state lookup tool shows there are at least 1,175 properties on the list so far. The breakdown so far is: 1,175 properties across the USA and Puerto Rico in the following brands, Holiday Inn Express (781), Holiday Inn (176), Candlewood Suites (120), Staybridge Suites (54), Crowne Plaza (30), Hotel Indigo (11), Holiday Inn Resort (3).

Original story:

IHG has been offering its franchised properties a free examination by an outside computer forensic team hired to look for signs of the same malware infestation known to have hit front desk systems at other properties. But not all property owners have been anxious to take the company up on that offer. As a consequence, there may be more breached hotel locations yet to be added to the state lookup tool.

A letter from IHG to franchise customers, offering to pay for the cyber forensics examination.

A letter from IHG to franchise customers, offering to pay for the cyber forensics examination.

IHG franchises who accepted the security inspections were told they would receive a consolidated report sharing information specific to the property, and that “your acquiring bank and/or processor may contact you regarding this investigation.”

IHG also has been trying to steer franchised properties toward adopting its “secure payment solution” (SPS) that ensures cardholder data remains encrypted at all times and at every “hop” across the electronic transaction. According to IHG, properties that used its solution prior to the initial intrusion on Sept. 29, 2016 were not affected.

“Many more properties implemented SPS after September 29, 2016, and the implementation of SPS ended the ability of the malware to find payment card data,” IHG wrote. Continue reading →

Shoney’s Hit By Apparent Credit Card Breach

April 14, 2017
46 Comments

It’s Friday, which means it’s time for another episode of “Which Restaurant Chain Got Hacked?” Multiple sources in the financial industry say they’ve traced a pattern of fraud on customer cards indicating that the latest victim may be Shoney’s, a 70-year-old restaurant chain that operates primarily in the southern United States.

Image: Thomas Hawk, Flickr.

Image: Thomas Hawk, Flickr.

Shoney’s did not respond to multiple requests for comment left with the company and its outside public relations firm over the past two weeks.

Based in Nashville, Tenn., the privately-held restaurant chain includes approximately 150 company-owned and franchised locations in 17 states from Maryland to Florida in the east, and from Missouri to Texas in the West — with the northernmost location being in Ohio, according to the company’s Wikipedia page.

Sources in the financial industry say they’ve received confidential alerts from the credit card associations about suspected breaches at dozens of those locations, although it remains unclear whether the problem is limited to those locations or if it extends company-wide. Those same sources say the affected locations were thought to have been breached between December 2016 and early March 2017.

It’s also unclear whether the apparent breach affects corporate-owned or franchised stores — or both. In last year’s card breach involving hundreds of Wendy’s restaurants, only franchised locations were thought to have been impacted. In the case of the intrusion at Arby’s, on the other hand, only corporate stores were affected. Continue reading →

Critical Security Updates from Adobe, Microsoft

April 12, 2017
47 Comments

Adobe and Microsoft separately issued updates on Tuesday to fix a slew of security flaws in their products. Adobe patched dozens of holes in its Flash Player, Acrobat and Reader products. Microsoft pushed fixes to address dozens of vulnerabilities in Windows and related software.

brokenwindowsThe biggest change this month for Windows users and specifically for people responsible for maintaining lots of Windows machines is that Microsoft has replaced individual security bulletins for patches with a single “Security Update Guide.”

This change follows closely on the heels of a move by Microsoft to bar home users from selectively downloading specific updates and instead issuing all monthly updates as one big patch blob.

Microsoft’s claims that customers have been clamoring for this consolidated guide notwithstanding, many users are likely to be put off by the new format, which seems to require a great deal more clicking and searching than under the previous rubric. In any case, Microsoft has released a FAQ explaining what’s changed and what folks can expect under the new arrangement.

By my count, Microsoft’s patches this week address some 46 security vulnerabilities, including flaws in Internet Explorer, Microsoft Edge, Windows, Office, Visual Studio for Mac, .NET Framework, Silverlight and Adobe Flash Player.

At least two of the critical bugs fixed by Microsoft this month are already being exploited in active attacks, including a weakness in Microsoft Word that is showing up in attacks designed to spread the Dridex banking trojan.

Finally, a heads up for any Microsoft users still running Windows Vista: This month is slated to be the last that Vista will receive security updates. Vista was first released to consumers more than ten years ago — in January 2007 — so if you’re still using Vista it might be time to give a more modern OS a try (doesn’t have to be Windows…just saying). Continue reading →

Fake News at Work in Spam Kingpin’s Arrest?

April 11, 2017
95 Comments

Over the past several days, many Western news media outlets have predictably devoured thinly-sourced reporting from a Russian publication that the arrest last week of a Russian spam kingpin in Spain was related to hacking attacks linked to last year’s U.S. election. While there is scant evidence that the spammer’s arrest had anything to do with the election, the success of that narrative is a sterling example of how the Kremlin’s propaganda machine is adept at manufacturing fake news, undermining public trust in the media, and distracting attention away from the real story.

Russian President Vladimir Putin tours RT facilities. Image: DNI

Russian President Vladimir Putin tours RT facilities. Image: DNI

On Saturday, news broke from RT.com (formerly Russia Today) that authorities in Spain had arrested 36-year-old Peter “Severa” Levashov, one of the most-wanted spammers on the planet and the alleged creator of some of the nastiest cybercrime engines in history — including the Storm worm, and the Waledac and Kelihos spam botnets.

But the RT story didn’t lead with Levashov’s alleged misdeeds or his primacy among junk emailers and virus writers. Rather, the publication said it interviewed Levashov’s wife Maria, who claimed that Spanish authorities said her husband was detained because he was suspected of being involved in hacking attacks aimed at influencing the 2016 U.S. election.

The RT piece is fairly typical of one that covers the arrest of Russian hackers in that the story quickly becomes not about the criminal charges but about how the accused is being unfairly treated or maligned by overzealous or misguided Western law enforcement agencies.

The RT story about Levashov, for example, seems engineered to leave readers with the impression that some bumbling cops rudely disturbed the springtime vacation of a nice Russian family, stole their belongings, and left a dazed and confused young mother alone to fend for herself and her child.

This should not be shocking to any journalist or reader who has paid attention to U.S. intelligence agency reports on Russia’s efforts to influence the outcome of last year’s election. A 25-page dossier released in January by the Office of the Director of National Intelligence describes RT as a U.S.-based but Kremlin-financed media outlet that is little more than an engine of anti-Western propaganda controlled by Russian intelligence agencies.

Somehow, this small detail was lost on countless Western media outlets, who seemed all too willing to parrot the narrative constructed by RT regarding Levashov’s arrest. With a brief nod to RT’s “scoop,” these publications back-benched the real story (the long-sought capture of one of the world’s most wanted spammers) and led with an angle supported by the flimsiest of sourcing. Continue reading →

Alleged Spam King Pyotr Levashov Arrested

April 10, 2017
60 Comments

Authorities in Spain have arrested a Russian computer programmer thought to be one of the world’s most notorious spam kingpins.

Spanish police arrested Pyotr Levashov under an international warrant executed in the city of Barcelona, according to Reuters. Russian state-run television station RT (formerly Russia Today) reported that Levashov was arrested while vacationing in Spain with his family.

Spamdot.biz moderator Severa listing prices to rent his Waledac spam botnet.

Spamdot.biz moderator Severa listing prices to rent his Waledac spam botnet.

According to numerous stories here at KrebsOnSecurity, Levashov was better known as “Severa,” the hacker moniker used by a pivotal figure in many Russian-language cybercrime forums. Severa was the moderator for the spam subsection of multiple online communities, and in this role served as the virtual linchpin connecting virus writers with huge spam networks — including some that Severa allegedly created and sold himself.

Levashov is currently listed as #7 in the the world’s Top 10 Worst Spammers list maintained by anti-spam group Spamhaus. The U.S. Justice Department maintains that Severa was the Russian partner of Alan Ralsky, a convicted American spammer who specialized in “pump-and-dump” spam schemes designed to artificially inflate the value of penny stocks.

Levashov allegedly went by the aliases Peter Severa and Peter of the North (Pyotr is the Russian form of Peter). My reporting indicates that — in addition to spamming activities — Severa was responsible for running multiple criminal operations that paid virus writers and spammers to install “fake antivirus” software. So-called “fake AV” uses malware and/or programming tricks to bombard the victim with misleading alerts about security threats, hijacking the PC until its owner either pays for a license to the bogus security software or figures out how to remove the invasive program.

A screenshot of a fake antivirus or "scareware" affiliate program run by "Severa," allegedly the cybercriminal alias of Pyotr Levashov, the Russian arrested in Spain last week.

A screenshot of a fake antivirus or “scareware” affiliate program run by “Severa,” allegedly the cybercriminal alias of Pyotr Levashov.

There is ample evidence that Severa is the cybercriminal behind the Waledac spam botnet, a spam engine that for several years infected between 70,000 and 90,000 computers and was capable of sending approximately 1.5 billion spam messages a day.

In 2010, Microsoft launched a combined technical and legal sneak attack on the Waledac botnet, successfully dismantling it. The company would later do the same to the Kelihos botnet, a global spam machine which shared a great deal of computer code with Waledac.

The connection between Waledac/Kelihos and Severa is supported by data leaked in 2010 after hackers broke into the servers of pharmacy spam affiliate program SpamIt. According to the stolen SpamIt records, Severa — this time using the alias “Viktor Sergeevich Ivashov” — brought in revenues of $438,000 and earned commissions of $145,000 spamming rogue online pharmacy sites over a 3-year period.

Severa also was a moderator of Spamdot.biz (pictured in the first screenshot above), a vetted, members-only forum that at one time attracted almost daily visits from most of Russia’s top spammers. Leaked Spamdot forum posts for Severa indicate that he hails from Saint Petersburg, Russia’s second-largest city. Continue reading →

Gamestop.com Investigating Possible Breach

April 7, 2017
45 Comments

Video game giant GameStop Corp.  [NSYE: GME] says it is investigating reports that hackers may have siphoned credit card and customer data from its website — gamestop.com. The company acknowledged the investigation after being contacted by KrebsOnSecurity.

gs“GameStop recently received notification from a third party that it believed payment card data from cards used on the GameStop.com website was being offered for sale on a website,” a company spokesman wrote in response to questions from this author.

“That day a leading security firm was engaged to investigate these claims. Gamestop has and will continue to work non-stop to address this report and take appropriate measures to eradicate any issue that may be identified,” the company’s statement continued.

Two sources in the financial industry told KrebsOnSecurity that they have received alerts from a credit card processor stating that Gamestop.com was likely compromised by intruders between mid-September 2016 and the first week of February 2017.

Those same sources said the compromised data is thought to include customer card number, expiration date, name, address and card verification value (CVV2), usually a 3-digit security code printed on the backs of credit cards.

Online merchants are not supposed to store CVV2 codes, but hackers can steal the codes by placing malicious software on a company’s e-commerce site, so that the data is copied and recorded by the intruders before it is encrypted and transmitted to be processed.

GameStop would not comment on the possible timeframe of the suspected breach, or say what types of customer data might be impacted.

Continue reading →

Self-Proclaimed ‘Nuclear Bot’ Author Weighs U.S. Job Offer

April 6, 2017
83 Comments

The author of a banking Trojan called Nuclear Bot — a teenager living in France — recently released the source code for his creation just months after the malware began showing up for sale in cybercrime forums. Now the young man’s father is trying to convince him not to act on a job offer in the United States, fearing it may be a trap set by law enforcement agents.

In December 2016, Arbor Networks released a writeup on Nuclear Bot (a.k.a. NukeBot) after researchers discovered the malware package for sale in the usual underground cybercrime forums for the price of USD $2,500.

The program’s author claimed the malware was written from scratch, but that it functioned similarly to the ZeuS banking trojan in that it could steal passwords and inject arbitrary content when victims visited banking Web sites.

The administration panel for Nuclear Bot. Image: IBM X-Force.

The administration panel for Nuclear Bot. Image: IBM X-Force.

Malware analysts at IBM’s X-Force research division also examined the code, primarily because the individual selling it claimed that Nuclear Bot could bypass Trusteer Rapport, an IBM security product that many banks offer customers to help blunt the effectiveness of banking trojans.

“These claims are unfounded and incorrect,” IBM’s researchers wrote. “Rapport detection and protection against the NukeBot malware are effective on all protection layers.”

But the malware’s original author — 18-year-old Augustin Inzirillo — begs to differ, saying he released the source code for the bot late last month in part because he wanted others be able to test his claims.

In an interview with KrebsOnSecurity, Inzirillo admits he wrote the Nuclear Bot trojan as a proof-of-concept to demonstrate a method he developed that he says bypasses Rapport. But he denies ever selling or marketing the malware, and maintains that this was done without his permission by an acquaintance with whom he shared the code privately.

“I’ve been interested in malware since I [was] a child, and I wanted to have a challenge,” Inzirillo said. “I was excited about this, and having nobody to share this with, I distributed the code to ‘friends’ who tried to profit off my work.”

After the source code for Nuclear Bot was released on Github, IBM followed up with a more in-depth examination of it, which argued that the author of the code appeared to release it in a failed bid to shore up his fragile ego.

According to IBM, a hacker calling himself “Gosya” tried to sell the malware in such a clumsy and inexperienced fashion that he managed to get himself banned from multiple cybercrime forums for violating specific rules about how such products should be sold.

“He did not have the malware tested and certified by forum admins, nor did he provide any test versions to members,” IBM researchers Limor Kessem and Ilya Kolmanovich wrote. “At the same time, he was attacked by existing competition, namely the FlokiBot vendor, who wanted to get down to the technical nitty gritty with him and find out if Gosya’s claims about his malware’s capabilities were indeed viable.”

The IBM authors continued:

“In posts where he replied to challenging questions, Gosya got nervous and defensive, raising suspicion among other forum members. This was likely a simple case of inexperience, but it cost him the trust of potential buyers.”

“For his next wrong move, Gosya started selling on additional forums under multiple monikers. When fraudsters realized that the same person was trying to vend under different names, they got even more suspicious that he was a ripper, misrepresenting or selling a product he does not possess. The issue got worse when Gosya changed the malware’s name to Micro Banking Trojan in one last attempt to buy it a new life.”

Inzirillo said the main reason he released his code was to prevent others from profiting off his creation. But now he says he regrets that decision as well.

“It was a big mistake, because now I know people will reuse my code to steal money from other people,” Inzirillo told KrebsOnSecurity in an online chat. 

Inzirillo released the code on Github with a short note explaining his motivations, and included a contact email address at a domain (inzirillo.com) set up long ago by his father, Daniel Inzirillo.

KrebsOnSecurity also reached out to Augustin’s dad, and heard back from him roughly an hour before Augustin replied to requests for an interview. Inzirillo the elder said his son used the family domain name in his source code release as part of a misguided attempt to impress him.

“He didn’t do it for money,” said Daniel Inzirillo, whose CV shows he has built an impressive career in computer programming and working for various financial institutions. “He did it to spite all the cyber shitheads. The idea was that they wouldn’t be able to sell his software anymore because it was now free for grabs.”

Daniel Inzirillo said he’s worried because his son has expressed a strong interest in traveling to the United States after receiving a job offer from a supposed recruiter at a technology firm which said it was impressed by Augustin’s coding skills.

“I am very worried for him, because some technology company told him they wanted to fly him to the U.S. for a job interview as a result of him posting that online,” Daniel Inzirillo said. “There is a strong possibility that in one or two weeks he’s going to be flying to California, and I am concerned that maybe some guy in some law enforcement agency has his sights on him.” Continue reading →

Dual-Use Software Criminal Case Not So Novel

April 4, 2017
75 Comments

“He built a piece of software. That tool was pirated and abused by hackers. Now the feds want him to pay for the computer crooks’ crimes.”

The above snippet is the subhead of a story published last month by the The Daily Beast titled, “FBI Arrests Hacker Who Hacked No One.” The subject of that piece — a 26-year-old American named Taylor Huddleston — faces felony hacking charges connected to two computer programs he authored and sold: An anti-piracy product called Net Seal, and a Remote Administration Tool (RAT) called NanoCore that he says was a benign program designed to help users remotely administer their computers.

Photo illustration by Lyne Lucien/The Daily Beast

Photo illustration by Lyne Lucien/The Daily Beast

The author of the Daily Beast story, former black hat hacker and Wired.com editor Kevin Poulsen, argues that Huddleston’s case raises a novel question: When is a programmer criminally responsible for the actions of his users?

“Some experts say [the case] could have far reaching implications for developers, particularly those working on new technologies that criminals might adopt in unforeseeable ways,” Poulsen wrote.

But a closer look at the government’s side of the story — as well as public postings left behind by the accused and his alleged accomplices — paints a more complex and nuanced picture that suggests this may not be the case to raise that specific legal question in any meaningful way.

Mark Rumold, senior staff attorney at the Electronic Frontier Foundation (EFF), said cases like these are not so cut-and-dry because they hinge on intent, and determining who knew what and when.

“I don’t read the government’s complaint as making the case that selling some type of RAT is illegal, and if that were the case I think we would be very interested in this,” Rumold said. “Whether or not [the government’s] claims are valid is going to be extraordinarily fact-specific, but unfortunately there is not a precise set of facts that would push this case from being about the valid reselling of a tool that no one questions can be done legally to crossing that threshold of engaging in a criminal conspiracy.”

Citing group chat logs and other evidence that hasn’t yet been made public, U.S. prosecutors say Huddleston intended NanoCore to function more like a Remote Access Trojan used to remotely control compromised PCs, and they’ve indicted Huddleston on criminal charges of conspiracy as well as aiding and abetting computer intrusions.

Poulsen depicts Huddleston as an ambitious — if extremely naive — programmer struggling to make an honest living selling what is essentially a dual-use software product. Using the nickname “Aeonhack,” Huddleston marketed his NanoCore RAT on Hackforums[dot]net, an English-language hacking forum that is overrun with young, impressionable but otherwise low-skilled hackers who are constantly looking for point-and-click tools and services that can help them demonstrate their supposed hacking prowess.

Yet we’re told that Huddleston was positively shocked to discover that many buyers on the forum were using his tools in a less-than-legal manner, and that in response he chastised and even penalized customers who did so. By way of example, Poulsen writes that Huddleston routinely used his Net Seal program to revoke the software licenses for customers who boasted online about using his NanoCore RAT illegally.

We later learn that — despite Net Seal’s copy protection abilities — denizens of Hackforums were able to pirate copies of NanoCore and spread it far and wide in malware and phishing campaigns. Eventually, Huddleston said he grew weary of all the drama and sold both programs to another Hackforums member, using the $60,000 or so in proceeds to move out of the rusty trailer he and his girlfriend shared and buy a house in a low-income corner of Hot Springs, Arkansas.

From the story:

Continue reading →