Privacy and Identity Theft

According to a research report by security firm SMobile Systems, about 20 percent of the 48,000 Android apps in the Android marketplace allow a third party to access the user’s data. This is typically apps sending SMS messages to premium phone numbers, or making phone calls on behalf of users.

Many of those applications are legitimate, but some are definitely malicious. Some of these applications do many of the things that spyware does: getting access to email and text messages, tracking phone call information and device location, etc.

Bank Info Security magazine today published an interview with Doug Johnson of the American Bankers Association (ABA) on the topic of corporate banking account takeovers by cyber criminals. Cyber criminals are increasingly using malware to steal online access to the bank accounts of small and medium sized companies and government agencies, and fraudulently transfer hundreds of thousands of dollars out of those accounts.

The interview is worth reading, and it can be found here.

When asked how big of a threat cyber criminal takeovers of Internet corporate banking accounts is, Mr. Johnson replied:

“Well, I think that the threat is very large. I think that the threat is not only a large one from the standpoint of the number of cases — which the FBI continues to observe are increasing for them. But I think the biggest risk that we face here, as it relates to the corporate account takeover, is the damage it does to the reputation of financial institutions and financial institutions’ customers, and the damage it does potentially to the relationship between our customers and our financial institutions. Because I do believe at the end of the day this is all about shared responsibility. Both financial institutions as well as financial institution customers do have a responsibility to have skin in the game to protect accounts, and I think that it is only through that active partnership that they were able really to address the current threat.”

The United Kingdom’s Information Commissioner’s Office has warned organisations that they need to minimise the risk of mistakes, as the number of reported data breaches exceeds 1,000.

An ICO report revealed that 254 breaches were as a result of information being disclosed in error, 307 were as a result of stolen data or hardware and 233 due to lost data or hardware.

David Smith, deputy commissioner at the ICO, said: “We all know that mistakes can happen but, the fact is that human error is behind a high proportion of security breaches that have been reported to us. Extra vigilance is required so that people’s personal information does not end up in the wrong hands.

“Organisations should have clear security and disclosure procedures that staff can understand, properly implement these and ensure that they are being followed by staff. Staff must be adequately trained not just in the value of personal information, but in how to protect it.

“We are keen to work with organisations to prevent breaches happening in the first place and to help ensure that things are put right when they do go wrong.”

IronKey’s Chief Technology Officer, Gil Spencer, was at the AUSCERT security conference in Australia this week. He was the lucky recipient of a promotional USB flash drive from IBM at the conference.

Today IBM sent out an apology. It seems that the USB flash drives that they handed out were infected with autorun malware. Nice one, IBM.

They should have given out IronKey secure devices. IronKey Enterprise devices have anti-malware software and hardware and firmware protection against autorun USB malware.

According to McAfee’s Q1 Threat Report, malware that is designed to spread onto USB removable storage devices was the most prevalent malware threat in Q1 2010. The number 1 most detected malware variant by McAfee researchers was “Generic! Atr”, followed by a number of password-stealing Trojans and the Autorun Conficker worm.

This should come as no surprise. The ability to infect USB drives, and then spread onto computers on which those drives are used, has become a widely exploited technique in many malware packages. Perhaps the most famous case of such an infection was in late 2008 when such a worm, “Agent.btz”, infected sensitive Department of Defense computers. This led to a lockdown by the DoD of all removable storage devices until they could define a set of technical operating requirements to ensure that malware cannot spread onto and from removable storage devices.

IronKey worked with the Department of Defense, National Security Agency, and other bureaus to help define these technical requirements. Now these capabilities are available to Enterprise customers of IronKey devices. They include services such as built-in anti-malware scanning, intelligent hardware-based autorun tamper prevention, read-only mode, etc.

A new report was released by the Anti-Phishing Working Group, rat the Sao Paulo Brazil “Counter Electronic-Crime Operations Summit”.

The report is titled “Global Phishing Survey: Trends and Domain Name Use 2H2009″. It is focused on an analysis of domain name registrar abuse, and how fraudulently registered domain names are used to operate phishing scams as well as malware and crimeware distribution.

In the second half of 2009, the “Avalanche” cyber crime gang appears to have been responsible for two-thirds of all phishing attacks launched in the second half of 2009, and was responsible for the overall increase in phishing attacks recorded across the Internet.

The Avalanche gang appears to be a group, perhaps largely of the same people, that has taken over from the notorious “Rock” phishing gang. The Rock phishers were the most prevalent online crime gang in the 2007-2008 period. They invented technology to automate phishing, spam and malware attacks by coordinating the compromise, operation and cleanup of thousands of servers across the Internet. The Rock phishing gang invented the “Fast Flux” technique of rotating phishing and malware sites across a given domain name, but on hundreds of servers, so that takedown of these sites was extremely difficult, and only having a domain registrar or registry suspend the domain could guarantee a takedown. This made approach effectively defeated blacklisting techniques for protecting users from visiting known phishing and malware distribution sites.

The Avalanche gang appears to have taken the approach to a new level. They continue to use large numbers of domain, and they use subdomain hosting services. But they are now using botnets, running on computers of consumers who do not realize that their computers are infected, and are in fact being used at night time by cyber criminals to perform their evil tasks.

The Avalanche gang is not only using this massive infrastructure for phishing, but they have been also using it to distributed malware and crimeware, notably the Zeus banking trojan.

Read all the details of the report here.

Financial Services Technology magazine has published my new article, “The 21st Century Trojan War”. In it I talk about the new corporate banking trojan threats, and how the cyber-underground is advancing their attacks against the financial services infrastructure by infiltrating the computers of finance professionals inside corporations and government agencies.

“In 2009, organized cyber crime rings began to shift away from massive phishing attacks against consumer banking users, and instead target bigger fish – corporate banking users. The cybercriminals use advanced malicious software (malware) to attack the computers of finance professionals in companies and government agencies. If a computer that is used to access a commercial online banking services becomes infected, the attackers can effectively take over the corporate financial accounts in real time by hijacking active banking sessions, and issue commands for funds transfers.

Symantec detected over 70,000 variants of the Zeus Trojan in 2009.

Documented losses to corporate banking customers from fraudulent wire transfers initiated in the USA by next-generation malware on corporate computers have ranged from $10,000 to over $1,000,000 per incident. Much of this money was successfully transferred to ‘money mule’ accounts overseas, and was never recovered. It is far more lucrative for cyber criminals to make numerous $9000 transfers from a single corporate bank account, than to try to hijack thousands of consumer-based accounts and make small money transfers. It is also reasonable to expect that online corporate banking fraud will track historical online consumer banking fraud patterns, and will grow dramatically over the next several years.”

Read the rest of the article at: Financial Services Technology Magazine.

A 12 year old boy found an unencrypted USB thumb drive memory stick in the parking lot of ASDA supermarket in Stenhousemuir, Scotland. To the surprise of the young lad and his parents, the memory stick contained patient records of mental patients at nearby Bellsdyke Hospital in Falkirk, Scotland.

The UK National Health Service issued the following statement: “We are very concerned to learn of this incident and are looking into it as a matter of urgency. We have clear policies in place on the safe use of portable data devices. We can confirm a member of staff has been suspended in connection with this incident.”

This is a clear example that policies in the workplace cannot guarantee compliance. For removable media, it is critical that healthcare companies and hospitals enforce always-on encryption by only using hardware encrypted portable storage devices such as an IronKey.

Yury Mashevsky of anti-virus company Kaspersky Labs has published a good article that outlines the state of the crimeware threat environment that we face in 2010.

Mashevsky illustrates the exploding number of financial crimeware/malware samples that Kaspersky has received on a quarterly basis since the financial crimeware industry got started in 2005.

This graph shows the increase in the number of unique malicious programs used to steal money from Internet users. Source: Kaspersky Lab

As banks roll out new security technologies and techniques, the criminal underground quickly develops means to defeat these technologies. The exploits are rapidly (often within 30 days) widely available in numerous crimeware variants that criminals can purchase over the Internet. Attacks are often hosted on computers in different countries that where the banks and their customers are located, making it very difficult to get websites that host malware or command & control servers taken down.

Mashevsky concludes that to make meaningful progress in the battle against an exponentially growing threat will require much tighter collaboration between financial institutions, their customers, the security industry, and government agencies.

The Medical Center in Bowling Green, Kentucky, is notifying over 5,000 patients that their personal data may be at risk, after an unencrypted hard drive containing their information was stolen from the hospital’s mammography unit.

The Medical Center is now stepping up their efforts to implement encryption for all mobile and portable storage devices, and is trying to centralize the storage of sensitive information on a protected internal network, rather than being stored on hundreds of computers throughout the facility.