Posts Tagged: ZeuS Trojan


13
Apr 12

Thieves Replacing Money Mules With Prepaid Cards?

Recent ebanking heists — such as a $121,000 online robbery at a New York fuel supplier last month — suggest that cyber thieves increasingly are cashing out by sending victim funds to prepaid debit card accounts. The shift appears to be an effort to route around a major bottleneck for these crimes: Their dependency on unreliable money mules.

Mules traditionally have played a key role in helping thieves cash out hacked accounts and launder money.  They are recruited through email-based work-at-home job scams, and are told they will be helping companies process payments. In a typical scheme, the mule provides her banking details to the recruiter, who eventually sends a fraudulent transfer and tells the mule to withdraw the funds in cash, keep a small percentage, and wire the remainder to co-conspirators abroad.

Some of the mule gangs I’ve identified.

But mules are hardly the most expedient method of extracting funds. To avoid arousing suspicion (and triggering anti-money laundering reporting requirements by the banks), cyber crooks usually send less than $10,000 to each mule. In other words, for every $100,000 that the thieves want to steal, they need to have  at least 10 money mules at the ready.

In reality, though, that number is quite often closer to 15 mules per $100,000. That’s because the thieves may send much lower amounts to mules that bank at institutions which have low transfer limit triggers. For instance, they almost always limit transfers to less than $5,000 when dealing with Bank of America mules, because they know transfers for more than that amount to consumer accounts will raise fraud flags at BofA.

Thus, the average mule is worth up to $10,000 to a cybercrook. Unsurprisingly, there is much competition and demand for available money mules in the cybercriminal underground. I’ve identified close to two dozen distinct money mule recruitment networks, most of which demand between 40-50 percent of the fraudulent transfer amounts for their trouble. Not only are mule expensive to acquire, they often take weeks to groom before they’re trusted with transfers.

But these mules also come with their own, well, baggage. I’ve interviewed now more than 200 money mules, and it’s hard to escape the conclusion that many mules simply are not the sharpest crayons in the box. They often have trouble following simple instructions, and frequently screw up important details when it comes time to cash out (there are probably good reasons that a lot of these folks are unemployed). Common goofs include transposing digits in account and routing numbers, or failing to get to the bank to withdraw the cash shortly after the fraudulent transfer, giving the victim’s bank precious time to reverse the transaction. In isolated cases, the mules simply disappear with the money and stiff the cyber thieves.

In several recent ebanking heists, however, thieves appear to have sent at least half of the transfers to prepaid cards, potentially sidestepping the expense and hassle of hiring and using money mules. For example, last month cyber crooks struck Alta East, a wholesale gasoline dealer in Middletown, N.Y. According to the firm’s comptroller Debbie Weeden, the thieves initiated 30 separate fraudulent transfers totaling more than $121,000. Half of those transfers went to prepaid cards issued by Metabank, a large prepaid card provider.

Prepaid cards are ideal because they can be purchased anonymously for small amounts ($25-$100 values) from supermarkets and other stores. A majority of these low-value cards are not reloadable, unless the cardholder goes online and provides identity information that the prepaid card issuer can tie to a legitimate credit holder. After that card is activated, it can be reloaded remotely by transferring or depositing funds into the account, and it can be used like a debit, ATM or credit card.

“The information we gather in opening it is the same information you’d be asked if you were opening a credit card account online,” said Brad Hanson, president of Metabank’s payment systems division. “We do checks against different public resources like Experian and LexisNexis to verify that all the information matches and is accurate, and that we have a reasonable belief that you are the person applying for the card.”

The trouble is, the thieves pulling these ebanking heists have access to massive amounts of stolen data that can be used to fraudulently open up prepaid cards in the names of people whose identities and computers have already been hijacked. Once those cards are approved, the crooks can simply transfer funds to them from cyberheist victims, and extract the cash at ATMs. Alternatively, wire transfer locations like Western Union even allow senders to use their debit cards to execute a “debit spend,” thereby sending money overseas directly from the card.

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26
Mar 12

A Busy Week for Cybercrime Justice

Last week was a bad one to be a cybercrook. Authorities in Russia arrested several men thought to be behind the Carberp banking Trojan, and obtained a guilty verdict against the infamous spammer Leo Kuvayev. In the United States, a jury returned a 33-month jail sentence against a Belarusian who ran a call service for cyber thieves. At the same time, U.S. prosecutors secured a guilty plea against a Russian man who was part of a gang that stole more than $3 million from U.S. businesses fleeced with the help of the ZeuS Trojan.

Kuvayev in Thailand, 2001

In August 2010, KrebsOnSecurity broke the news that spam king Leonid “Leo” Aleksandorovich Kuvayev, was being held in a Russian prison awaiting multiple child molestation charges.  Late Friday, a Moscow City court judge rendered a guilty verdict against Kuvayev for crimes against the sexual integrity of minors, according to Russian news agency Lenta.ru.

In 2005, the attorney general of Massachusetts successfully sued Kuvayev for violations of the CAN-SPAM Act, a law that prohibits the sending of e-mail that includes false or misleading information about the origins of the message, among other restrictions. Armed with a massive trove of spam evidence gathered largely by lawyers and security experts at Microsoft Corp., the state showed that Kuvayev’s operation, an affiliate program known as BadCow, was responsible for blasting tens of millions of junk e-mails peddling everything from pirated software to counterfeit pharmaceuticals and porn.

In an apparent bid to sidestep those charges, Kuvayev fled the United States for Russia. A Massachusetts judge later convicted Kuvayev of CAN-SPAM violations, and ordered him to pay $37 million in civil penalties. FBI officials say that at the time, BadCow was raking in more than $30 million each year.

Russian prosecutors said Kuvayev sexually abused at least 11 girls aged 13 to 18 years, many of them suffering from mental and psychological problems and pupils of orphanages and boarding schools nearby Kuvayev’s business and residence in Moscow.

According to information obtained by KrebsOnSecurity, Russian prosecutors had help from Kuvayev’s old nemesis Microsoft, which had hired a local forensics company in 2010 to keep tabs on his activities. Microsoft’s Samantha Doerr confirmed that Microsoft Russia consulted with Moscow-based cyber forensics firm Group-IB, but said the nature of the investigation was related to Kuvayev’s spamming activities. Lenta.ru reports that it’s not clear when Kuvayev may be sentenced, but that the most serious offense he faces carries a penalty of 20 years in prison.

Group-IB also assisted in another investigation that bore fruit last week: The arrest of eight men — including two ringleaders from Moscow — alleged to have been responsible for seeding computers worldwide Carberp and RDPdor, powerful banking Trojans. Russian authorities say the crime gang used the malware to raid at least 130 million rubles (~$4.43 million USD) from more than 100 banks around the world, and from businesses in Russia, Germany and the Netherlands. Russian police released a video showing one of the suspects loudly weeping in the moments following a morning raid on his home.

The arrests help explain why the makers of Carberp abruptly stopped selling the Trojan late last year. Until recently, Carberp was sold on shadowy underground forums for more than $9,000 per license. In the screen shot below, a lead coder for the Carberp Trojan can be seen announcing on Nov. 1, 2011 that he will be immediately suspending new sales of the malware, and will not be reachable going forward. Continue reading →


23
Jan 12

‘Citadel’ Trojan Touts Trouble-Ticket System

Underground hacker forums are full of complaints from users angry that a developer of some popular banking Trojan or bot program has stopped supporting his product, stranding buyers with buggy botnets. Now, the proprietors of a new ZeuS Trojan variant are marketing their malware as a social network that lets customers file bug reports, suggest and vote on new features in upcoming versions, and track trouble tickets that can be worked on by the developers and fellow users alike.

A screenshot of the Citadel botnet panel.

The ZeuS offshoot, dubbed Citadel and advertised on several members-only hacker forums, is another software-as-a-service malware development. Its target audience? Those frustrated with virus writers who decide that coding their next creation is more lucrative and interesting than supporting current clients.

“Its no secret that the products in our field — without support from the developers — result in a piece of junk on your hard drive. Therefore, the product should be improved according to the wishes of our customers,” Citadel’s developers claim in an online posting. “One problem is that you have probably experienced developers who ignore your instant messages, because there are many customers but there is only one developer.”

In the following excerpt, taken from a full description of Citadel’s innovations, the developers of this malware strain describe its defining feature as a social networking platform for malware users that is made available through a Web-based portal created by the malware itself.

“We have created for you a special system — call it the social network for our customers. Citadel CRM Store allows you to take part in product development in the following ways:

– Report bugs and other errors in software. All tickets are looked at by technical support you will receive a timely response to your questions. No more trying to reach the author via ICQ or Jabber.

-Each client has the right to create an unlimited number of applications within the system. Requests can contain suggestions on a new module or improvements of existing module. Such requests can be public or private.

-Each client has a right to vote on new ideas suggested by other members and offer his/her price for development of the enhancement/module. The decision is made by the developers on whether to go forward with certain enhancement or new module depending on the voting results.

-Each client has the right to comment on any application and talk to any member. Now it is going to be interesting for you to find partners and like-minded people and also to take active parts in discussions with the developers.

– You can see all stages of module development, if it is approved other members. We update the status and time to completion.

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30
Nov 11

DDoS Attacks Spell ‘Gameover’ for Banks, Victims in Cyber Heists

The FBI is warning that computer crooks have begun launching debilitating cyber attacks against banks and their customers as part of a smoke screen to prevent victims from noticing simultaneous high-dollar cyber heists.

The bureau says the attacks coincide with corporate account takeovers perpetrated by thieves who are using a modified version of the ZeuS Trojan called “Gameover.” The rash of thefts come after a series of heavy spam campaigns aimed at deploying the malware, which arrives disguised as an email from the National Automated Clearing House Association (NACHA), a not-for-profit group that develops operating rules for organizations that handle electronic payments. The ZeuS variant steals passwords and gives attackers direct access to the victim’s PC and network.

In several recent attacks, as soon as thieves wired money out of a victim organization’s account, the victim’s public-facing Internet address was targeted by a network attack, leaving employees at the organization unable to browse the Web.

A few of the attacks have included an odd twist that appears to indicate the perpetrators are using money mules in the United States for at least a portion of the heists. According to an FBI advisory, some of the unauthorized wire transfers from victim organizations have been transmitted directly to high-end jewelry stores, “wherein the money mule comes to the actual store to pick up his $100K in jewels (or whatever dollar amount was wired).”

The advisory continues:

“Investigation has shown the perpetrators contact the high-end jeweler requesting to purchase precious stones and high-end watches. The perpetrators advise they will wire the money to the jeweler’s account and someone will come to pick up the merchandise. The next day, a money mule arrives at the store, the jeweler confirms the money has been transferred or is listed as ‘pending’ and releases the merchandise to the mule. Later on, the transaction is reversed or cancelled (if the financial institution caught the fraud in time) and the jeweler is out whatever jewels the money mule was able to obtain.”

The attackers also have sought to take out the Web sites of victim banks. Jose Nazario, manager of security research at Arbor Networks, a company that specializes in helping organizations weather large cyber attacks, said that although many of the bank sites hit belong to small to mid-sized financial institutions, the thieves also have taken out some of the larger banks in the course of recent e-heists.

“It’s a disturbing trend,” Nazario said.

Nazario said the handful of attacks he’s aware of in the past two weeks have involved distributed denial-of-service (DDoS) assaults launched with the help of “Dirt Jumper” or “Russkill” botnets. Dirt Jumper is a commercial crimeware kit that is sold for a few hundred bucks on the hacker underground, and is made to be surreptitiously installed on hacked PCs. The code makes it easy for the botnet owner to use those infected systems to overwhelm targeted sites with junk traffic (KrebsOnSecurity.com was the victim of a Dirt Jumper botnet attack earlier this month).

Security experts aren’t certain about the strategy behind the DDoS attacks, which are noisy and noticeable to both victims and their banks. One theory is that the perpetrators are hoping the outages will distract the banks and victims.

“The belief is the DDoS is used to deflect attention from the wire transfers as well to make them unable to reverse the transactions (if found),” the FBI said.

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14
Nov 11

Title Firm Sues Bank Over $207k Cyberheist

A title insurance firm in Virginia is suing its bank after an eight-day cyber heist involving more than $2 million in thefts and more than $200,000 in losses last year. In an unusual twist, at least some of the Eastern European thieves involved in the attack have already been convicted and imprisoned for their roles in the crime.

Sometime before June 2010, crooks infected computers of Vienna, Va. based Global Title Services with the ZeuS Trojan, giving them direct access to the company’s network and online banking passwords at then-Chevy Chase Bank (now Capital One). On June 1, 2010, the thieves made their move, and began sending a series of unauthorized wire transfers to money mules, individuals who were hired to help launder the funds and relay them to crooks overseas.

The first three wires totaled more than $200,000. When Global Title’s owner Priya Aurora went to log in to her company’s accounts 15 minutes prior to the first fraudulent transfers went out, she found the account was locked: The site said the account was overdue for security updates.

When Aurora visited the bank local Chase branch to get assistance, she was told she needed to deal with the bank’s back office customer service. Between June 2 and June 8, the thieves would send out 15 more wires totaling nearly $1.8 million. The bank ultimately was able to reverse all but the first three fraudulent wires on June 1.

Capital One declined to comment for this story, citing the ongoing litigation.

Global Title is suing Capital One, alleging the bank failed to act in good faith and failed to implement commercially reasonable security procedures for its online banking clients. The lawsuit notes that at the time of the breach, Capital One’s online banking system used single-factor authentication; it allowed commercial clients to log in and to transfer millions of dollars using nothing more than a username and password.

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25
Jul 11

Calif. Co. Sues Bank Over $465k eBanking Heist

A California real estate escrow company that lost more than $465,000 in an online banking heist last year is suing its former financial institution, alleging that the bank was negligent and that it failed to live up to the terms of its own online banking contract.

The plight of Redondo Beach, Calif. based Village View Escrow, first publicized by KrebsOnSecurity last summer, began in March 2010. That’s when organized crooks broke into the firm’s computers and bank accounts, and sent 26 consecutive wire transfers to 20 individuals around the world who had no legitimate business with the firm.

Village View’s bank, Professional Business Bank of Pasadena, Calif., relied on third-party service provider NetTeller, which allowed commercial customers to authenticate to the bank’s site with little more than a username and password. Village View’s contract with Professional Bank stated that electronic transfers would only be allowed if they were authorized by two Village View employees, and confirmed by a call from specific Village View phone numbers.

The attack on Village View demonstrates the sophistication of malicious software like the ZeuS Trojan. The thieves disguised a banking Trojan as a UPS shipping receipt, and the company’s owner acknowledged opening the attachment and forwarding it to another employee who also viewed the malware-laced file. Once inside Village View’s systems, the attackers apparently disabled email notifications from the bank.

Nevertheless, Village View’s lawsuit challenges Professional Bank’s claims that its systems used “multi-factor,” and “state-0f-the-art” ebanking systems, and accuses the bank of negligence for not having procedures to help the company recover the fraudulent transfers.

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11
Jul 11

ZeuS Trojan for Google Android Spotted

Criminals have developed a component of the ZeuS Trojan designed to run on Google Android phones. The new strain of malware comes as security experts are warning about the threat from mobile malware that may use tainted ads and drive-by downloads.

Image courtesy Fortinet.

Researchers at Fortinet said the malicious file is a new version of “Zitmo,” a family of mobile malware first spotted last year that stands for “ZeuS in the mobile.” The Zitmo variant, disguised as a security application, is designed to intercept the one-time passcodes that banks send to mobile users as an added security feature. It masquerades as a component of Rapport, a banking activation application from Trusteer. Once installed, the malware lies in wait for incoming text messages, and forwards them to a remote Web server.

Trusteer published a lengthy blog post today that mentions an attack by this threat “that was used in conjunction with Zeus 2.1.0.10. The user was first infected with Zeus on their PC and then Zeus showed the message requesting the user to download the Android malware component.” In a phone interview, Trusteer CEO Mickey Boodaei said crooks used the Trojan in live attacks against several online banking users during the first week of June, but that the infrastructure that supported the attacks was taken offline about a month ago.

Boodaei offers a bold and grim forecast for the development of mobile malware, predicting that within 12 to 24 months more than 1 in 20 (5.6%) of Android phones and iPads/iPhones could become infected by mobile malware if fraudsters start integrating zero-day mobile vulnerabilities into leading exploit kits.

The last bit about exploit kits is key, because almost all mobile malware developed so far uses some type of social engineering to install itself on a device. Boodaei predicts a future time when crooks begin incorporating mobile phone vulnerabilities into automated exploit kits like BlackHole and Eleonore, which use security flaws to install malicious software when the user visits a booby-trapped site with a vulnerable device.

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29
Jun 11

Regulators Issue Updated eBanking Security Guidelines

Federal banking regulators today released a long-awaited supplement to the 2005 guidelines that describe what banks should be doing to protect e-banking customers from hackers and account takeovers. Experts called the updated guidance a step forward, but were divided over whether it would be adequate to protect small to mid-sized businesses against today’s sophisticated online attackers.

The new guidance updates “Authentication in an Internet Banking Environment,” a document released in 2005 by the Federal Financial Institutions Examination Council (FFIEC) for use by bank security examiners. The 2005 guidance has been criticized for being increasingly irrelevant in the face of current threats like the password-stealing ZeuS Trojan, which can defeat many traditional customer-facing online banking authentication and security measures. The financial industry has been expecting the update since December 2010, when a draft version of the guidelines was accidentally leaked.

The document released today (PDF) recognizes the need to protect customers from newer threats, but stops short of endorsing any specific technology or approach. Instead, it calls on banks to conduct more rigorous risk assessments,  to monitor customer transactions for suspicious activity, and to work harder to educate customers — particularly businesses — about the risks involved in banking online.

“Fraudsters have continued to develop and deploy more sophisticated, effective, and malicious methods to compromise authentication mechanisms and gain unauthorized access to customers’ online accounts,” the FFIEC wrote. “Rapidly growing organized criminal groups have become more specialized in financial fraud and have been successful in compromising an increasing array of controls.”

The 2005 guidelines drew little distinction between precautions a bank should take to protect consumer and commercial accounts, but the supplement makes clear that online business transactions generally involve much higher level of risk to financial institutions and commercial customers. It calls for “layered security programs” to deal with these riskier transactions, such as:

-methods for detecting transaction anomalies;

-dual transaction authorization through different access devices;

-the use of out-of-band verification for transactions;

-the use of “positive pay” and debit blocks to appropriately limit the transactional use of an account;

-“enhanced controls over account activities,” such as transaction value thresholds, payment recipients, the number of transactions allowed per day and allowable payment days and times; and

-“enhanced customer education to increase awareness of the fraud risk and effective techniques customers can use to mitigate the risk.”

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10
Jun 11

FBI Investigating Cyber Theft of $139,000 from Pittsford, NY

Computer crooks stole at least $139,000 from the town coffers of Pittsford, New York this week. The theft is the latest reminder of the widening gap between the sophistication of organized cyber thieves and the increasingly ineffective security measures employed by many financial institutions across the United States.

The attack began on or around June 1, 2011, when someone logged into the online commercial banking account of the Town of Pittsford, a municipality of 25,000 not far from Rochester, N.Y. The thieves initiated a small batch of automated clearing house (ACH) transfers to several money mules, willing or unwitting individuals in the U.S.A. who had been recruited by the attackers prior to the theft. The mules pulled the money out of their bank accounts in cash and wired it to individuals in Saint Petersburg, Russia and Kiev, Ukraine via transfer services Western Union and Moneygram.

Over the next four business days, the thieves initiated another three fraudulent batch payments to money mules. Some transfers went to money mules who owned businesses, such as a $14,750 payment to Mission Viejo, Calif. based Art Snyder Software. Most money mules were sent payments of less than $5,000.

Pittsford town supervisor William Carpenter said the FBI is investigating the incident, and that many of the details of how the attackers got in remain unclear. He said the FBI told him the thieves most likely stole the town’s online banking password using a banking Trojan. He added that the town has recovered just $4,800 of the stolen funds, the proceeds of a single transfer. I left a message with the FBI field office in New York but haven’t yet heard back.

“We have good firewalls and anti-virus software, and we weren’t at all lax in our security systems,” Carpenter said. “We thought we were pretty secure.”

Carpenter said the fraud went undetected for days. He said the town normally does its direct deposit payroll bi-weekly on Wednesdays, and that the first fraudulent transfers happened during a non-payroll week.

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8
Nov 10

Keeping an Eye on the SpyEye Trojan

Last month, I published evidence suggesting that future development of the ZeuS banking Trojan was being merged with that of the up-and-coming SpyEye Trojan. Since then, a flood of new research has been published about SpyEye, including a new Web site that helps track the location of SpyEye control networks worldwide.

Roman Hüssy, the curator of Zeustracker — a site that has spotlighted ZeuS activity around the globe since early 2009 — late last week launched SpyEye Tracker, a sister service designed to help Internet service providers keep tabs on miscreants using SpyEye (take care with the IP address links listed at this service, because they can lead to live, malicious files).

Hüssy said he’s not convinced that the SpyEye crimeware kit will usurp the mighty ZeuS. “Why should they give up something which works and pay for a new tool?” he said in an online chat with KrebsOnSecurity.com. Instead, Hüssy said he’s launching the new tracking service to help prevent that shift.

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