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The U.S. Federal Bureau of Investigation (FBI) this week arrested a New York man on suspicion of running BreachForums, a popular English-language cybercrime forum where some of the world biggest hacked databases routinely show up for sale. The forum’s administrator “Pompompurin” has been a thorn in the side of the FBI for years, and BreachForums is widely considered a reincarnation of RaidForums, a remarkably similar crime forum that the FBI infiltrated and dismantled in 2022.
Federal agents carting items out of Fitzpatrick’s home on March 15. Image: News 12 Westchester.
In an affidavit filed with the District Court for the Southern District of New York, FBI Special Agent John Longmire said that at around 4:30 p.m. on March 15, 2023, he led a team of law enforcement agents that made a probable cause arrest of a Conor Brian Fitzpatrick in Peekskill, NY.
“When I arrested the defendant on March 15, 2023, he stated to me in substance and in part that: a) his name was Conor Brian Fitzpatrick; b) he used the alias ‘pompompurin/’ and c) he was the owner and administrator of ‘BreachForums’ the data breach website referenced in the Complaint,” Longmire wrote.
Pompompurin has been something of a nemesis to the FBI for several years. In November 2021, KrebsOnSecurity broke the news that thousands of fake emails about a cybercrime investigation were blasted out from the FBI’s email systems and Internet addresses.
Pompompurin took credit for that stunt, and said he was able to send the FBI email blast by exploiting a flaw in an FBI portal designed to share information with state and local law enforcement authorities. The FBI later acknowledged that a software misconfiguration allowed someone to send the fake emails.
In December, 2022, KrebsOnSecurity broke the news that hackers active on BreachForums had infiltrated the FBI’s InfraGard program, a vetted FBI program designed to build cyber and physical threat information sharing partnerships with experts in the private sector. The hackers impersonated the CEO of a major financial company, applied for InfraGard membership in the CEO’s name, and were granted admission to the community.
From there, the hackers plundered the InfraGard member database, and proceeded to sell contact information on more than 80,000 InfraGard members in an auction on BreachForums. The FBI responded by disabling the portal for some time, before ultimately forcing all InfraGard members to re-apply for membership.
More recently, BreachForums was the sales forum for data stolen from DC Health Link, a health insurance exchange based in Washington, D.C. that suffered a data breach this month. The sales thread initially said the data included the names, Social Security numbers, dates of birth, health plan and enrollee information and more on 170,000 individuals, although the official notice about the breach says 56,415 people were affected.
In April 2022, U.S. Justice Department seized the servers and domains for RaidForums, an extremely popular English-language cybercrime forum that sold access to more than 10 billion consumer records stolen in some of the world’s largest data breaches since 2015. As part of that operation, the feds also charged the alleged administrator, 21-year-old Diogo Santos Coelho of Portugal, with six criminal counts.
Coelho was arrested in the United Kingdom on Jan. 31, 2022. By that time, the new BreachForums had been live for just under a week, but with a familiar look.
BreachForums remains accessible online, and from reviewing the live chat stream on the site’s home page it appears the forum’s active users are only just becoming aware that their administrator — and the site’s database — is likely now in FBI hands:
Members of BreachForums discuss the arrest of the forum’s alleged owner.
“Wait if they arrested pom then doesn’t the FBI have all of our details we’ve registered with?” asked one worried BreachForums member.
“But we all have good VPNs I guess, right…right guys?” another denizen offered.
“Like pom would most likely do a plea bargain and cooperate with the feds as much as possible,” replied another.
Fitzpatrick could not be immediately reached for comment. The FBI declined to comment for this story.
There is only one page to the criminal complaint against Fitzpatrick (PDF), which charges him with one count of conspiracy to commit access device fraud. The affidavit on his arrest is available here (PDF).
Update: Corrected spelling of FBI agent’s last name.
The domain name registrar Freenom, whose free domain names have long been a draw for spammers and phishers, has stopped allowing new domain name registrations. The move comes after the Dutch registrar was sued by Meta, which alleges the company ignores abuse complaints about phishing websites while monetizing traffic to those abusive domains.
Freenom’s website features a message saying it is not currently allowing new registrations.
Freenom is the domain name registry service provider for five so-called “country code top level domains” (ccTLDs), including .cf for the Central African Republic; .ga for Gabon; .gq for Equatorial Guinea; .ml for Mali; and .tk for Tokelau.
Freenom has always waived the registration fees for domains in these country-code domains, presumably as a way to encourage users to pay for related services, such as registering a .com or .net domain, for which Freenom does charge a fee.
On March 3, 2023, social media giant Meta sued Freenom in a Northern California court, alleging cybersquatting violations and trademark infringement. The lawsuit also seeks information about the identities of 20 different “John Does” — Freenom customers that Meta says have been particularly active in phishing attacks against Facebook, Instagram, and WhatsApp users.
The lawsuit points to a 2021 study (PDF) on the abuse of domains conducted by Interisle Consulting Group, which discovered that those ccTLDs operated by Freenom made up five of the Top Ten TLDs most abused by phishers.
“The five ccTLDs to which Freenom provides its services are the TLDs of choice for cybercriminals because Freenom provides free domain name registration services and shields its customers’ identity, even after being presented with evidence that the domain names are being used for illegal purposes,” the complaint charges. “Even after receiving notices of infringement or phishing by its customers, Freenom continues to license new infringing domain names to those same customers.”
Meta further alleges that “Freenom has repeatedly failed to take appropriate steps to investigate and respond appropriately to reports of abuse,” and that it monetizes the traffic from infringing domains by reselling them and by adding “parking pages” that redirect visitors to other commercial websites, websites with pornographic content, and websites used for malicious activity like phishing.
Freenom has not yet responded to requests for comment. But attempts to register a domain through the company’s website as of publication time generated an error message that reads:
“Because of technical issues the Freenom application for new registrations is temporarily out-of-order. Please accept our apologies for the inconvenience. We are working on a solution and hope to resume operations shortly. Thank you for your understanding.”
Image: Interisle Consulting Group, Phishing Landscape 2021, Sept. 2021.
Although Freenom is based in The Netherlands, some of its other sister companies named as defendants in the lawsuit are incorporated in the United States.
Meta initially filed this lawsuit in December 2022, but it asked the court to seal the case, which would have restricted public access to court documents in the dispute. That request was denied, and Meta amended and re-filed the lawsuit last week.
According to Meta, this isn’t just a case of another domain name registrar ignoring abuse complaints because it’s bad for business. The lawsuit alleges that the owners of Freenom “are part of a web of companies created to facilitate cybersquatting, all for the benefit of Freenom.”
“On information and belief, one or more of the ccTLD Service Providers, ID Shield, Yoursafe, Freedom Registry, Fintag, Cervesia, VTL, Joost Zuurbier Management Services B.V., and Doe Defendants were created to hide assets, ensure unlawful activity including cybersquatting and phishing goes undetected, and to further the goals of Freenom,” Meta charged.
It remains unclear why Freenom has stopped allowing domain registration. In June 2015, ICANN suspended Freenom’s ability to create new domain names or initiate inbound transfers of domain names for 90 days. According to Meta, the suspension was premised on ICANN’s determination that Freenom “has engaged in a pattern and practice of trafficking in or use of domain names identical or confusingly similar to a trademark or service mark of a third party in which the Registered Name Holder has no rights or legitimate interest.”
A spokesperson for ICANN said the organization has no insight as to why Freenom might have stopped registering domain names. But it said Freenom (d/b/a OpenTLD B.V.) also received formal enforcement notices from ICANN in 2017 and 2020 for violating different obligations.
A copy of the amended complaint against Freenom, et. al, is available here (PDF).
March 8, 6:11 p.m. ET: Updated story with response from ICANN. Corrected attribution of the domain abuse report.
Web hosting giant GoDaddy made headlines this month when it disclosed that a multi-year breach allowed intruders to steal company source code, siphon customer and employee login credentials, and foist malware on customer websites. Media coverage understandably focused on GoDaddy’s admission that it suffered three different cyberattacks over as many years at the hands of the same hacking group. But it’s worth revisiting how this group typically got in to targeted companies: By calling employees and tricking them into navigating to a phishing website.
In a filing with the U.S. Securities and Exchange Commission (SEC), GoDaddy said it determined that the same “sophisticated threat actor group” was responsible for three separate intrusions, including:
-March 2020: A spear-phishing attack on a GoDaddy employee compromised the hosting login credentials of approximately 28,000 GoDaddy customers, as well as login credentials for a small number employees;
-November 2021: A compromised GoDaddy password let attackers steal source code and information tied to 1.2 million customers, including website administrator passwords, sFTP credentials, and private SSL keys;
-December 2022: Hackers gained access to and installed malware on GoDaddy’s cPanel hosting servers that “intermittently redirected random customer websites to malicious sites.”
“Based on our investigation, we believe these incidents are part of a multi-year campaign by a sophisticated threat actor group that, among other things, installed malware on our systems and obtained pieces of code related to some services within GoDaddy,” the company stated in its SEC filing.
What else do we know about the cause of these incidents? We don’t know much about the source of the November 2021 incident, other than GoDaddy’s statement that it involved a compromised password, and that it took about two months for the company to detect the intrusion. GoDaddy has not disclosed the source of the breach in December 2022 that led to malware on some customer websites.
But we do know the March 2020 attack was precipitated by a spear-phishing attack against a GoDaddy employee. GoDaddy described the incident at the time in general terms as a social engineering attack, but one of its customers affected by that March 2020 breach actually spoke to one of the hackers involved.
The hackers were able to change the Domain Name System (DNS) records for the transaction brokering site escrow.com so that it pointed to an address in Malaysia that was host to just a few other domains, including the then brand-new phishing domain servicenow-godaddy[.]com.
The general manager of Escrow.com found himself on the phone with one of the GoDaddy hackers, after someone who claimed they worked at GoDaddy called and said they needed him to authorize some changes to the account.
In reality, the caller had just tricked a GoDaddy employee into giving away their credentials, and he could see from the employee’s account that Escrow.com required a specific security procedure to complete a domain transfer.
The general manager of Escrow.com said he suspected the call was a scam, but decided to play along for about an hour — all the while recording the call and coaxing information out of the scammer.
“This guy had access to the notes, and knew the number to call,” to make changes to the account, the CEO of Escrow.com told KrebsOnSecurity. “He was literally reading off the tickets to the notes of the admin panel inside GoDaddy.”
About halfway through this conversation — after being called out by the general manager as an imposter — the hacker admitted that he was not a GoDaddy employee, and that he was in fact part of a group that enjoyed repeated success with social engineering employees at targeted companies over the phone.
Absent from GoDaddy’s SEC statement is another spate of attacks in November 2020, in which unknown intruders redirected email and web traffic for multiple cryptocurrency services that used GoDaddy in some capacity.
It is possible this incident was not mentioned because it was the work of yet another group of intruders. But in response to questions from KrebsOnSecurity at the time, GoDaddy said that incident also stemmed from a “limited” number of GoDaddy employees falling for a sophisticated social engineering scam.
“As threat actors become increasingly sophisticated and aggressive in their attacks, we are constantly educating employees about new tactics that might be used against them and adopting new security measures to prevent future attacks,” GoDaddy said in a written statement back in 2020.
Voice phishing or “vishing” attacks typically target employees who work remotely. The phishers will usually claim that they’re calling from the employer’s IT department, supposedly to help troubleshoot some issue. The goal is to convince the target to enter their credentials at a website set up by the attackers that mimics the organization’s corporate email or VPN portal.
Experts interviewed for an August 2020 story on a steep rise in successful voice phishing attacks said there are generally at least two people involved in each vishing scam: One who is social engineering the target over the phone, and another co-conspirator who takes any credentials entered at the phishing page — including multi-factor authentication codes shared by the victim — and quickly uses them to log in to the company’s website.
The attackers are usually careful to do nothing with the phishing domain until they are ready to initiate a vishing call to a potential victim. And when the attack or call is complete, they disable the website tied to the domain.
This is key because many domain registrars will only respond to external requests to take down a phishing website if the site is live at the time of the abuse complaint. This tactic also can stymie efforts by companies that focus on identifying newly-registered phishing domains before they can be used for fraud.
A U2F device made by Yubikey.
GoDaddy’s latest SEC filing indicates the company had nearly 7,000 employees as of December 2022. In addition, GoDaddy contracts with another 3,000 people who work full-time for the company via business process outsourcing companies based primarily in India, the Philippines and Colombia.
Many companies now require employees to supply a one-time password — such as one sent via SMS or produced by a mobile authenticator app — in addition to their username and password when logging in to company assets online. But both SMS and app-based codes can be undermined by phishing attacks that simply request this information in addition to the user’s password.
One multifactor option — physical security keys — appears to be immune to these advanced scams. The most commonly used security keys are inexpensive USB-based devices. A security key implements a form of multi-factor authentication known as Universal 2nd Factor (U2F), which allows the user to complete the login process simply by inserting the USB device and pressing a button on the device. The key works without the need for any special software drivers.
The allure of U2F devices for multi-factor authentication is that even if an employee who has enrolled a security key for authentication tries to log in at an impostor site, the company’s systems simply refuse to request the security key if the user isn’t on their employer’s legitimate website, and the login attempt fails. Thus, the second factor cannot be phished, either over the phone or Internet.
In July 2018, Google disclosed that it had not had any of its 85,000+ employees successfully phished on their work-related accounts since early 2017, when it began requiring all employees to use physical security keys in place of one-time codes.
Authorities in the United States and United Kingdom today levied financial sanctions against seven men accused of operating “Trickbot,” a cybercrime-as-a-service platform based in Russia that has enabled countless ransomware attacks and bank account takeovers since its debut in 2016. The U.S. Department of the Treasury says the Trickbot group is associated with Russian intelligence services, and that this alliance led to the targeting of many U.S. companies and government entities.
Initially a stealthy trojan horse program delivered via email and used to steal passwords, Trickbot evolved into “a highly modular malware suite that provides the Trickbot Group with the ability to conduct a variety of illegal cyber activities, including ransomware attacks,” the Treasury Department said.
A spam email from 2020 containing a Trickbot-infected attachment. Image: Microsoft.
“During the height of the COVID-19 pandemic in 2020, Trickbot targeted hospitals and healthcare centers, launching a wave of ransomware attacks against hospitals across the United States,” the sanctions notice continued. “In one of these attacks, the Trickbot Group deployed ransomware against three Minnesota medical facilities, disrupting their computer networks and telephones, and causing a diversion of ambulances. Members of the Trickbot Group publicly gloated over the ease of targeting the medical facilities and the speed with which the ransoms were paid to the group.”
Only one of the men sanctioned today is known to have been criminally charged in connection with hacking activity. According to the Treasury Department, the alleged senior leader of the Trickbot group is 34-year-old Russian national Vitaly “Bentley” Kovalev.
A New Jersey grand jury indicted Kovalev in 2012 after an investigation by the U.S. Secret Service determined that he ran a massive “money mule” scheme, which used phony job offers to trick people into laundering money stolen from hacked small to mid-sized businesses in the United States. The 2012 indictment against Kovalev relates to cybercrimes he allegedly perpetrated prior to the creation of Trickbot.
In 2015, Kovalev reportedly began filming a movie in Russia about cybercrime called “Botnet.” According to a 2016 story from Forbes.ru, Botnet’s opening scene was to depict the plight of Christina Svechinskaya, a Russian student arrested by FBI agents in September 2010.
Christina Svechinskaya, a money mule hired by Bentley who was arrested by the FBI in 2010.
Svechinskaya was one of Bentley’s money mules, most of whom were young Russian students on temporary travel visas in the United States. She was among 37 alleged mules charged with aiding an international cybercrime operation — basically, setting up phony corporate bank accounts for the sole purpose of laundering stolen funds.
Although she possessed no real hacking skills, Svechinskaya’s mugshot and social media photos went viral online and she was quickly dubbed “the world’s sexiest computer hacker” by the tabloids.
Kovalev’s Botnet film project was disrupted after Russian authorities raided the film production company’s offices as part of a cybercrime investigation. In February 2016, Reuters reported that the raid was connected to a crackdown on “Dyre,” a sophisticated trojan that U.S. federal investigators say was the precursor to the Trickbot malware. The Forbes.ru article cited sources close to the investigation who said the film studio was operating as a money-laundering front for the cybercrooks behind Dyre.
But shifting political winds in Russia would soon bring high treason charges against three of the Russian cybercrime investigators tied to the investigation into the film studio. In a major shakeup in 2017, the Kremlin levied treason charges against Sergey Mikhaylov, then deputy chief of Russia’s top anti-cybercrime unit.
Also charged with treason was Ruslan Stoyanov, then a senior employee at Russian security firm Kaspersky Lab [the Forbes.ru report from 2016 said investigators from Mikhaylov’s unit and Kaspersky Lab were present at the film company raid].
Russian media outlets have speculated that the men were accused of treason for helping American cybercrime investigators pursue top Russian hackers. However, the charges against both men were classified and have never been officially revealed. After their brief, closed trial, both men were convicted of treason. Mikhaylov was given a 22 year prison sentence; Stoyanov was sentenced to 14 years in prison.
In September 2021, the Kremlin issued treason charges against Ilya Sachkov, formerly head of the cybersecurity firm Group-IB. According to Reuters, Sachkov and his company were hired by the film studio “to advise the Botnet director and writers on the finer points of cybercrime.” Sachkov remains imprisoned in Russia pending his treason trial.
Trickbot was heavily used by Conti and Ryuk, two of Russia’s most ruthless and successful ransomware groups. Blockchain analysis firm Chainalysis estimates that in 2021 alone, Conti extorted more than USD $100 million from its hacking victims; Chainalysis estimates Ryuk extorted more than USD $150 million from its ransomware victims.
The U.S. cybersecurity firm CrowdStrike has long tracked the activities of Trickbot, Ryuk and Conti under the same moniker — “Wizard Spider” — which CrowdStrike describes as “a Russia-nexus cybercriminal group behind the core development and distribution of a sophisticated arsenal of criminal tools, that allow them to run multiple different types of operations.”
“CrowdStrike Intelligence has observed WIZARD SPIDER targeting multiple countries and industries such as academia, energy, financial services, government, and more,” said Adam Meyers, head of intelligence at CrowdStrike.
This is not the U.S. government’s first swipe at the Trickbot group. In early October 2020, KrebsOnSecurity broke the news that someone had launched a series of coordinated attacks designed to disrupt the Trickbot botnet. A week later, The Washington Post ran a story saying the attack on Trickbot was the work of U.S. Cyber Command, a branch of the Department of Defense headed by the director of the U.S. National Security Agency (NSA).
Days after Russia invaded Ukraine in February 2022, a Ukrainian researcher leaked several years of internal chat logs from the Conti ransomware gang. Those candid conversations offer a fascinating view into the challenges of running a sprawling criminal enterprise with more than 100 salaried employees. They also showed that Conti enjoyed protection from prosecution by Russian authorities, as long as the hacker group took care not to target Russian organizations.
In addition, the leaked Conti chats confirmed there was considerable overlap in the operation and leadership of Conti, Trickbot and Ryuk.
Michael DeBolt, chief intelligence officer at cybersecurity firm Intel 471, said the leaked Conti chats showed Bentley oversaw a team of coders tasked with ensuring that the Trickbot and Conti malware remained undetected by the different antivirus and security software vendors.
In the years prior to the emergence of Trickbot in 2016, Bentley worked closely on the Gameover ZeuS trojan, a peer-to-peer malware threat that infected between 500,000 and a million computers with an automated ransomware strain called Cryptolocker, DeBolt said.
The FBI has a standing $3 million bounty offered for the capture of Evgeny “Slavik” Bogachev, the alleged author of the Zeus trojan. And there are indications that Bentley worked directly with Bogachev. DeBolt pointed to an October 2014 discussion on the exclusive Russian hacking forum Mazafaka that included a complaint by a Russian hosting firm against a forum user by the name “Ferrari” who had failed to pay a $30,000 hosting bill.
In that discussion thread, it emerged that the hosting company thought it was filing a complaint against Slavik. But the Mazafaka member who vouched for Ferrari’s membership on the forum said they knew Ferrari as Bentley the mule handler, and at some point Slavik and Bentley must have been sharing the Ferrari user account.
“It is likely that Slavik (aka. Bogachev) and Bentley (aka. Kovalev) shared the same ‘Ferrari’ handle on the Mazafaka forum circa 2014, which suggests the two had a working relationship at that time, and supports the recent US and UK Government announcements regarding Kovalev’s past involvement in cybercrime predating Dyre or the Trickbot Group,” DeBolt said.
CrowdStrike’s Meyers said while Wizard Spider operations have significantly reduced following the demise of Conti in June 2022, today’s sanctions will likely cause temporary disruptions for the cybercriminal group while they look for ways to circumvent the financial restrictions — which make it illegal to transact with or hold the assets of sanctioned persons or entities.
“Often, when cybercriminal groups are disrupted, they will go dark for a time only to rebrand under a new name,” Meyers said.
The prosecution of Kovalev is being handled by the U.S. Attorney’s Office in New Jersey. A copy of the now-unsealed 2012 indictment of Kovalev is here (PDF).
Pledging to follow healthier habits is consistently the most popular new year’s resolution. That January 1st promise looks different to everyone: snacking less often, going to the gym more often, drinking more water, drinking less soda, etc. This year, instead of a juice cleanse subscription, opt for a healthier habit that’s not an unappetizing shade of green: follow this digital detox, instead! In three easy steps, you can make great strides in improving your digital wellness.
There are various aspects of your digital habits that you should consider updating for a more private and safer online life. For starters, update your passwords. Do you reuse the same password for multiple online accounts? Doing so puts your personally identifiable information (PII) at great risk. For example, if a business with which you have an online shopping account is breached by a cybercriminal, your login and password combination could make it on the dark web, through no fault of your own. Then, through a brute force attack, a criminal could use that same password and username combo to walk into your banking or tax filing accounts.
Remembering unique, complicated passwords and passphrases for your dozens of online accounts would be impossible. Luckily, there’s software that remembers them for you! It’s called a password manager, which acts as a vault for all your login information. Just remember one master password, and you can be confident in the security of your accounts and never have to deal with the hassle of forgetting passwords.
Another aspect of updating you should adopt in 2023 is making an effort to always upgrade to the latest software updates on all your devices. The easiest way to do this is to turn on automatic updates. From there, you don’t need to take any further action! Apps and operating systems (like Apple, Android, and Windows) often release updates to patch security vulnerabilities. When you run outdated software, there’s a chance a cybercriminal could take advantage of that security gap.
Finally, make sure that you keep updated on the latest security headlines. Consider setting up news alerts to notify you when a breach occurs at a company that you frequent or have an account with. Speed is often key in making sure that your information remains safe, so it’s best practice to have your finger on the pulse on the security news of the day.
A new year digital detox can be a whole family affair. Connect with your family, anyone connected to your home network, and your elderly relatives to get everyone on the same page with security best practices. Here are some common online security snags people of all ages encounter:
Everyone has an oversharer on their newsfeed. Alert your family members of the dangers of posting too much about their personal life. When someone takes those “get to know you” quizzes and posts their answers, cybercriminals can use that post to take educated guesses at your passwords. Additionally, social engineers can tailor social media scams to specific people in order to increase the chances of tricking someone into sending money or sharing valuable personal or banking details.
While spam filters catch a lot of phishing emails, phishers are getting smarter by the day and are making their attempts more and more believable. Connect with your loved ones and make sure they know how to recognize phishing emails, texts, and social media direct messages. Telltale signs of a phishing message include:
If you’re ever unsure if a message is a phishing attempt, the best course of action is to just delete it. If the “sender” is a well-known institution, follow up with a phone call using the official customer service number listed on their website. The phisher may also claim to be someone you know personally. In that case, give the loved one in question a phone call. It’s a good excuse to reconnect and have a nice conversation!
In the quest for free streams of the latest new show or movie, people often encounter unsafe sites that hide malware, spyware or other types malicious links and programs. Some types of malware can jump from one device to others connected to the same home Wi-Fi network. That’s why it’s important to make sure everyone under your roof practices excellent digital security habits. One wrong click could sink an entire household. Consider signing up your family for a safe browsing extension that can notify you when you stray onto a risky site. So, instead of putting your device at risk during movie night, connect with your friends or loved ones over one copy of a safely and officially purchased version.
As with any new health regimen, immediately zooming from zero to a hundred will likely be overwhelming and result in failure. The same goes for adopting new digital safety habits. If you try to do too much at once, all the security measures you put in place will likely get in the way of your daily online activities. The more inconvenient it is, the more likely you may be to cut corners; thus, negating all the progress you’ve made.
Being cybersafe doesn’t mean you can’t still enjoy your connected devices to the fullest. It just means that you may need to act with more intention and slow down before volunteering personal details online or clicking on links.
To supplement your digital detox, consider signing up for McAfee+ Ultimate to make 2023 the year for a safer online you. McAfee+ Ultimate includes all the tools you need to live your best online life safely and privately, including a password manager, web protection, unlimited VPN and antivirus, and $1 million in identity theft coverage and restoration for peace of mind.
Cheers to a digitally smart 2023!
The post Start the New Year Right With This 3-Step Digital Detox appeared first on McAfee Blog.
Our core mission in the NOC is network resilience. We also provide integrated security, visibility and automation, a SOC inside the NOC.
In part one, we covered:
In part two, we are going deep with security:
As the needs of Black Hat evolved, so did the Cisco Secure Technologies in the NOC:
The SecureX dashboard made it easy to see the status of each of the connected Cisco Secure technologies.
Since joining the Black Hat NOC in 2016, my goal remains integration and automation. As a NOC team comprised of many technologies and companies, we are pleased that this Black Hat NOC was the most integrated to date, to provide an overall SOC cybersecurity architecture solution.
We have ideas for even more integrations for Black Hat Asia and Black Hat USA 2023. Thank you, Piotr Jarzynka, for designing the integration diagram.
Below are the SecureX threat response integrations for Black Hat Europe, empowering analysts to investigate Indicators of Compromise very quickly, with one search.
The original Black Hat NOC integration for Cisco was NetWitness sending suspicious files to Threat Grid (know Secure Malware Analytics). We expanded that in 2022 with Palo Alto Networks Cortex XSOAR and used it in London, for investigation of malicious payload attack.
NetWitness observed a targeted attack against the Black Hat network. The attack was intended to compromise the network.
NetWitness extracted the payload and sent it to Secure Malware Analytics for detonation.
Reviewing the analysis report, we were able to quickly determine it was the MyDoom worm, which would have been very damaging.
The attack was blocked at the perimeter and the analysts were able to track and enrich the incident in XSOAR.
My first time at Black Hat turned out to be an incredible journey!
Thanks to the cybersecurity partnership between Paris 2024 and Cisco, I was able to integrate into the Cisco Crew, to operate the NOC/SOC as a Threat Hunter on the most dangerous network in the world for this European Edition of Black Hat.
My first day, I helped with deploying the network by installing the wireless Meraki APs on the venue, understanding how they were configured and how they could help analysts to identify and locate any client connected to the network that could have a bad behavior during the event, the idea being to protect the attendees if an attack was to spray on the network.
Following this “physical” deployment, I’ve been able to access the whole Cisco Secure environment including Meraki, Secure Malware Analytics, Umbrella, SecureX and the other Black Hat NOC partners software tools.
SecureX was definitely the product on which I wanted to step up. By having so fantastic professionals around me, we were able to dig in the product, identifying potential use cases to deploy in the orchestration module and expected integrations for Paris 2024.
Time was flying and so were the attendees to the conference, a network without user is fun but can be quite boring as nothing happens, having so many cybersecurity professional at the same place testing different security malwares, attacks and so on led us to very interesting investigations. A paradox at the Black Hat, we do not want to block malicious content as it could be part of exercises or training classes, quite a different mindset as what we, security defenders, are used to! Using the different components, we were able to find some observables/IOCs that we investigate through SecureX, SecureX being connected to all the other components helped us to enrich the observables (IPs, urls, domains…), understanding the criticality of what we identified (such as malware payloads) and even led us to poke the folks in the training classes to let them know that something really wrong was happening on their devices.
Being part of the Black Hat NOC was an incredible experience, I was able to meet fantastic professionals, fully committed on making the event a success for all attendees and exhibitors. It also helped me to better understand how products, that we use or will use within Paris 2024, could be leveraged to our needs and which indicators could be added to our various Dashboards, helping us to identify, instantaneously, that something is happening.
During the last day of Black Hat Europe, our NOC partner, NetWitness saw some files being downloaded on the network. The integration again automatically carved out the file and submitted the Cisco Secure Malware Analytics (SMA) platform. One of those files came back as a trojan, after SMA detonated the file in a sandbox environment. The specific hash is the below SHA-256:
938635a0ceed453dc8ff60eab20c5d168a882bdd41792e5c5056cc960ebef575
The screenshot below shows some of the behaviors that influenced the decision:
The result of seeing these behaviors caused SMA to give it the highest judgement score available to a detonated file:
After this judgement was made, we connected with the Palo Alto Networks team, and they found the IP address associated with the file download.
Once we had this information, we went to the Meraki dashboard and did a search for the IP address. The search returned only one client that has been associated with the address for the entire Black Hat conference.
Knowing that there has only been one client associated with the address made finding the attendee easier. We then needed to know where they were and Meraki had this figured out. After opening the client’s profile, we saw what SSID and access point (AP) they were connected to using the Meraki location map.
We then found the attendee and let them know to have their IT inspect their laptop to make sure it is clean.
Apart from the technical challenges of running a temporary network for N thousand people, the Black Hat event reminded us that success doesn’t happen without teamwork; that leadership isn’t just about keeping the project on track. It is also about looking after the team and that small details in planning, build up and tear down can be just as important, as having all the right tools and fantastically skilled Individuals using them during the event itself.
In the Cisco Secure technology stack, within the Black Hat NOC, we use SecureX Single Sign-on. This reduces the confusion of managing multiple accounts and passwords. It also streamlines the integrations between the Cisco products and our fellow NOC partners. We have an open ecosystem approach to integrations and access in the NOC, so we will provision Cisco Secure accounts for any staff member of the NOC. Logging into each individual console and creating an account is time consuming and can often lead to confusion on which tools to provision and which permission levels are needed.
To automate this process, I developed two workflows: one to create non-admin users for NOC partners and one to create administrator accounts in all the tools for Cisco staff. The workflows create accounts in SecureX, Secure Malware Analytics (Threat Grid), Umbrella DNS and Meraki dashboard, all using SecureX Single Sign-On.
Here is what the workflow looks like for creating non-admin users.
The workflow requires three inputs: first name, last name, and email. Click Run.
The sequence of API calls is as follows:
Once the workflow has completed successfully, the user will receive four emails to create a SecureX Sign-On account and accept the invitations to the various products. These workflows really improved our responsiveness to account provisioning requests and makes it much easier to collaborate with other NOC partners.
Over the previous Black Hat events, we have been utilizing Meraki scanning data to get location data for individual clients, as they roamed conference. In the initial blog post (Black Hat Asia 2022), we created a Docker container to accept the data from the Meraki Scanning API and save it for future analysis. At Black Hat USA 2022, we wrote about how to use Python Folium to use the flat text files to generate chronological heatmaps that illustrated the density of clients throughout the conference.
This time around, we’ve stepped it up again by integrating Umbrella DNS Security events and adding the ability to track clients across the heatmap using their local IP address.
To improve the portability of our data and the efficiency of our code, we began by moving from flat JSON files to a proper database. We chose SQLite this time around, though going forward we will likely use Mongo.
Both can be queried directly into Python Pandas dataframes which is what will give us the optimal performance we are looking for. We have a dedicated Docker container (Meraki-Receiver) that will validate the incoming data stream from the Meraki dashboard and insert the values into the database.
The database is stored on a Docker volume that can be mounted by our second container, the Meraki-Mapper. Though this container’s primary purpose is building the heatmaps, it also performs the task of retrieving and correlating Umbrella DNS security events. That is, any DNS query from the Black Hat network that matches one of several predefined security categories. Umbrella’s APIs were recently improved to add OAuth and simplify the URI scheme for each endpoint. After retrieving a token, we can get all security events in the time frame of the current heatmap with one call.
What we want to do with these events is to create Folium Markers. These are static “pins” that will sit on the map to indicate where the DNS query originated from. Clicking on a marker will popup more information about the query and the client who sent it.
Thanks to the Umbrella Virtual Appliances in the Black Hat network, we have the internal IP address of the client who sent the DNS query. We also have the internal IP address in the Meraki scanning data, along with the latitude and longitude. After converting the database query into a Pandas dataframe, our logic takes the IP address from the DNS query and finds all instances in the database of location data for that IP within a 5-minute window (the resolution of our heatmap).
What we end up with is a list of dictionaries representing the markers we want to add to the map. Using Bootstrap, we can format the popup for each event to make it look a bit more polished. Folium’s Popup plugin allows for an iFrame for each marker popup.
The result is a moving heatmap covering an entire day on a given conference floor, complete with markers indicating security events (the red pushpin icon).
Clicking on the pushpin shows the details of the query, allowing us in the NOC to see the exact location of the client when they sent it.
To further improve this service during the next conference, we plan to implement a web page where NOC staff can submit an IP address and immediately get map tracking that client through the conference floor. This should give us an even more efficient way to find and notify folks who are either behaving maliciously or appear to be infected.
For years we have been tracking the DNS stats at the Blackhat conferences. The post-pandemic 2022 numbers look like we never skipped a beat after the dip in DNS queries from 2021, seen in the bar graph below. This year’s attendance saw well over 11 million total DNS queries.
The Activity volume view from Umbrella gives a top-level level glance of activity by category, which we can drill into for deeper threat hunting. On trend with the previous Black Hat Europe events, the top Security categories were Dynamic DNS and Newly Seen Domains. However, it’s worth noting a proportionally larger increase in the cryptomining and phishing categories from 9 to 17 and 28 to 73, respectively, compared to last year.
These years, Black Hat saw over 4,100 apps connect to the network, which is nearly double of what was seen last year. However, still not topping over 6,100 apps seen at Black Hat USA early this year.
Should the need arise, we can block any application, such as Mail.ru above.
Black Hat Europe 2022 was the best planned and executed NOC in my experience, with the most integrations and visibility. This allowed us the time to deal with problems, which will always arise.
We are very proud of the collaboration of the team and the NOC partners.
Black Hat Asia will be in May 2023, at the Marina Bay Sands, Singapore…hope to see you there!
Thank you to the Cisco NOC team:
Also, to our NOC partners NetWitness (especially David Glover, Iain Davidson, Alessandro Contini and Alessandro Zatti), Palo Alto Networks (especially James Holland, Matt Ford, Matt Smith and Mathew Chase), Gigamon, IronNet, and the entire Black Hat / Informa Tech staff (especially Grifter ‘Neil Wyler’, Bart Stump, Steve Fink, James Pope, Jess Stafford and Steve Oldenbourg).
For 25 years, Black Hat has provided attendees with the very latest in information security research, development, and trends. These high-profile global events and trainings are driven by the needs of the security community, striving to bring together the best minds in the industry. Black Hat inspires professionals at all career levels, encouraging growth and collaboration among academia, world-class researchers, and leaders in the public and private sectors. Black Hat Briefings and Trainings are held annually in the United States, Europe and USA. More information is available at: blackhat.com. Black Hat is brought to you by Informa Tech.
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Cisco Secure Social Channels
In this blog about the design, deployment and automation of the Black Hat network, we have the following sections:
Cisco is honored to be a Premium Partner of the Black Hat NOC, and is the Official Network Platform, Mobile Device Management, Malware Analysis and DNS (Domain Name Service) Provider of Black Hat.
2022 was Cisco’s sixth year as a NOC partner for Black Hat Europe. However, it was our first time building the network for Black Hat Europe. We used experiences of Black Hat Asia 2022 and Black Hat USA 2022 to refine the planning for network topology design and equipment. Below are our fellow NOC partners providing hardware, to build and secure the network, for our joint customer: Black Hat.
We are grateful to share that Black Hat Europe 2022 was the smoothest experience we’ve had in the years at Black Hat. This is thanks to the 15 Cisco Meraki and Cisco Secure engineers on site (plus virtually supporting engineers) to build, operate and secure the network; and great NOC leadership and collaborative partners.
To plan, configure, deploy (in two days), maintain resilience, and recover (in four hours) an enterprise class network, took a lot of coordination. We appreciate the Black Hat NOC leadership, Informa and the NOC partners; meeting each week to discuss the best design, staffing, gear selection and deployment, to meet the unique needs of the conference. Check out the “Meraki Unboxed” podcast – Episode 94: Learnings from the Black Hat Europe 2022 Cybersecurity Event
We must allow real malware on the Black Hat network: for training, demonstrations, and briefing sessions; while protecting the attendees from attack within the network from their fellow attendees, and prevent bad actors from using the network to attack the Internet. It is a critical balance to ensure everyone has a safe experience, while still being able to learn from real world malware, vulnerabilities, and malicious websites.
In addition to the weekly meetings with Black Hat and the other partners, the Cisco Meraki engineering team of Sandro Fasser, Rossi Rosario Burgos, Otis Ioannou, Asmae Boutkhil, Jeffry Handal and I met every Friday for two months. We also discussed the challenges in a Webex space with other engineers who worked on past Black Hat events.
The mission:
Division of labor is essential to reduce mistakes and stay laser focused on security scope. Otis took the lead working on network topology design with Partners. Asmae handled the port assignments for the switches. Rossi ensured every AP and Switch was tracked, and the MAC addresses were provided to Palo Alto Networks for DCHP assignments. Otis and Rossi spent two days in the server room with the NOC partners, ensuring every switch was operating and configured correctly. Rossi also deployed and configured a remote Registration switch for Black Hat.
In the weeks before deployment, our virtual Meraki team member, Aleksandar Dimitrov Vladimirov, and I focused on planning and creating a virtual Wi-Fi site survey. Multiple requirements and restrictions had to be taken into consideration. The report was based on the ExCel centre floor plans, the space allocation requirements from Black Hat and the number of APs we had available to us. Although challenging to create, with some uncertainties and often changing requirements due to the number of stakeholders involved, the surveys AP placement for best coverage ended up being pivotal at the event.
Below is the Signal Strength plan for the Expo Hall Floor on the 5 GHz band. The original plan to go with a dual-Band deployment was adjusted onsite and the 2.4 GHz band was disabled to enhance performance and throughput. This was a decision made during the network setup, in coordination with the NOC Leadership and based on experience from past conferences.
Upon arrival at the ExCel Centre, we conducted a walkthrough of the space that most of us had only seen as a floor plan and on some photos. Thanks to good planning, we could start deploying the 100+ APs immediately, with only a small number of changes to optimize the deployment on-site. As the APs had been pre-staged and added to the Meraki dashboard, including their location on the floor maps, the main work was placing and cabling them physically. During operation, the floor plans in the Meraki Dashboard were a visual help to easily spot a problem and navigate the team on the ground to the right spot, if something had to be adjusted.
As the sponsors and attendees filled each space, in the Meraki dashboard, we were able to see in real-time the number of clients connected to each AP, currently and over the time of the conference. This enabled quick reaction if challenges were identified, or APs could be redeployed to other zones. Below is the ExCel Centre Capital Hall and London Suites, Level 0. We could switch between the four levels with a single click on the Floor Plans, and drill into any AP, as needed.
The Location heatmaps also provided essential visibility into conference traffic, both on the network and footfalls of attendees. Physical security is also an important aspect of cybersecurity; we need to know how devices move in space, know where valuable assets are located and monitor their safety.
Below is the Business Hall at lunchtime, on the opening day of the conference. You can see no live APs in the bottom right corner of the Location heatmap. This is an example of adapting the plan to reality onsite. In past Black Hat Europe conferences, the Lobby in that area was the main entrance. Construction in 2022 closed this entrance. So, those APs were reallocated to the Level 1 Lobby, where attendees would naturally flow from Registration.
The floor plans and heatmaps also helped with the Training, Briefings and Keynote network resilience. Capacity was easy to add temporarily, and we were able to remove it and relocate it after a space emptied.
During our time in the NOC, we had the chance to work with other vendor engineers and some use cases that came up led to interesting collaborations. One specific use case was that we wanted to block wireless clients, that show some malicious or bad behavior, automatically after they have been identified by one of the SOC analysts on the different security platforms, in addition we wanted to show them a friendly warning page that guides them to the SOC for a friendly conversation.
The solution was a script that can be triggered thru the interfaces of the other security products and attaches a group policy thru the Meraki Dashboard, including a quarantine VLAN and a splash page, via the Meraki APIs. This integration was just one of the many collaboration bits that we worked on.
During the first day of training, in the Meraki dashboard Air Marshal, I observed packet flood attacks, against we were able to adapt and remain resilient.
I also observed an AP spoofing and broadcast de-authentication attack. I was able to quickly identify the location of the attack, which was at the Lobby outside the Business Hall. Should the attacks continue, physical security had the information to intervene. We also had the ability to track the MAC address throughout the venue, as discussed in Christian Clasen’s section in part two.
From our experiences at Black Hat USA 2022, we had encrypted frames enabled, blunting the attack.
The Meraki dashboards made it very easy to monitor the health of the network APs and Switches, with the ability to aggregate data, and quickly pivot into any switch, AP or clients.
Through the phases of the conference, from two days of pre-conference setup, to focused and intense training the first two days, and transition to the briefings and Business Hall, we were able to visualize the network traffic.
In addition, we could see the number of attendees who passed through the covered area of the conference, with or without connecting to the network. Christian Clasen takes this available data to a new level in Part 2 of the blog.
As the person with core responsibilities for the switch configuration and uptime, the Meraki dashboard made it very simple to quickly change the network topology, according to the needs of the Black Hat customer.
If you refer back to Black Hat USA 2022, you’d have seen that we had over 1,000 iOS devices to deploy, with which we had several difficulties. For context, the company that leases the devices to Black Hat doesn’t use a Mobile Device Management (MDM) platform for any of their other shows…Black Hat is the only one that does. So, instead of using a mass deployment technology, like Apple’s Automated Device Enrollment, the iOS devices are “prepared” using Apple Configurator. This includes uploading a Wi-Fi profile to the devices as part of that process. In Las Vegas, this Wi-Fi profile wasn’t set to auto join the Wi-Fi, resulting in the need to manually change this on 1,000 devices. Furthermore, 200 devices weren’t reset or prepared, so we had those to reimage as well.
Black Hat Europe 2022 was different. We took the lessons from US and coordinated with the contractor to prepare the devices. Now, if you’ve ever used Apple Configurator, there’s several steps needed to prepare a device. However, all of these can be actions can be combined into a Blueprint:
Instead of there being several steps to prepare a device, there is now just one! Applying the Blueprint!
For Black Hat Europe, this included:
There’s lots of other things that can be achieved as well, but this results in the time taken to enroll and set up a device to around 30 seconds. Since devices can be set up in parallel (you’re only limited by the number of USB cables / ports you have), this really streamlines the enrollment and set up process.
Now, for the future, whilst you can’t Export these blueprints, they are transportable. If you open Terminal on a Mac and type:
cd /Users/<YOUR USER NAME>/Library/Group Containers/K36BKF7T3D.group.com.apple.configurator/Library/Application Support/com.apple.configurator/Blueprints
You’ll see a file / package called something.blueprint This can be zipped up and emailed to some else so, they can then use the exact same Blueprint! You may need to reboot your computer for the Blueprint to appear in Apple Configurator.
As mentioned, the registration / lead capture / session scanning devices are provided by the contractor. Obviously, these are all catalogued and have a unique device code / QR code on the back of them. However, during setup, any device name provisioned on the device gets lost.
So, there’s three things we do to know, without having to resort to using the unwieldy serial number, what devices is what.
In the footnote, you’ll see Device Name and Device Serial in blue. This denotes that the values are actually dynamic and change per device. They include:
On the Lock Screen, it’s now possible to see the device’s name and serial number, without having to flip the device over (A problem for the registration devices which are locked in a secure case) or open systems preferences.
We also had integration with SecureX device insights, to see the security status of each iOS device.
With the ability to quickly check on device health from the SecureX dashboard.
This goes without saying, but the iOS devices (Registration, Lead Capture and Session Scanning) do have access to personal information. To ensure the security of the data, devices are wiped at the end of the conference. This is incredibly satisfying, hitting the Erase Devices button in Meraki Systems Manager, and watching the 100+ devices reset!
Deploying a network like Black Hat takes a lot of work, and repetitive configuration. Much of this has been covered in previous blogs. However, to make things easier for this event, instead of the 60 training SSIDs we had in Black Hat US 2022, the Meraki team discussed the benefits of moving to iPSKs with Black Hat NOC Leadership, which accepted the plan.
For context, instead of having a single pre shared key for an SSID, iPSK functionality allows you to have 1000+. Each of these iPSKs can be assigned its own group policy / VLAN. So, we created a script:
This only involves five API calls:
The bulk of the script is error handling (The SSID or network doesn’t exist, for example) and logic!
The result was one SSID for all of training: BHTraining, and each classroom had their own password. This reduced the training SSIDs from over a dozen and helped clear the airwaves.
Thank you to the Cisco NOC team:
Also, to our NOC partners NetWitness (especially David Glover, Iain Davidson, Alessandro Contini and Alessandro Zatti), Palo Alto Networks (especially James Holland, Matt Ford, Matt Smith and Mathew Chase), Gigamon, IronNet, and the entire Black Hat / Informa Tech staff (especially Grifter ‘Neil Wyler’, Bart Stump, Steve Fink, James Pope, Jess Stafford and Steve Oldenbourg).
For 25 years, Black Hat has provided attendees with the very latest in information security research, development, and trends. These high-profile global events and trainings are driven by the needs of the security community, striving to bring together the best minds in the industry. Black Hat inspires professionals at all career levels, encouraging growth and collaboration among academia, world-class researchers, and leaders in the public and private sectors. Black Hat Briefings and Trainings are held annually in the United States, Europe and USA. More information is available at: blackhat.com. Black Hat is brought to you by Informa Tech.
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Cisco Secure Social Channels
Let’s face it: Having “2022 election” in the headline above is probably the only reason anyone might read this story today. Still, while most of us here in the United States are anxiously awaiting the results of how well we’ve patched our Democracy, it seems fitting that Microsoft Corp. today released gobs of security patches for its ubiquitous Windows operating systems. November’s patch batch includes fixes for a whopping six zero-day security vulnerabilities that miscreants and malware are already exploiting in the wild.
Probably the scariest of the zero-day flaws is CVE-2022-41128, a “critical” weakness in the Windows scripting languages that could be used to foist malicious software on vulnerable users who do nothing more than browse to a hacked or malicious site that exploits the weakness. Microsoft credits Google with reporting the vulnerability, which earned a CVSS score of 8.8.
CVE-2022-41073 is a zero-day flaw in the Windows Print Spooler, a Windows component that Microsoft has patched mightily over the past year. Kevin Breen, director of cyber threat research at Immersive Labs, noted that the print spooler has been a popular target for vulnerabilities in the last 12 months, with this marking the 9th patch.
The third zero-day Microsoft patched this month is CVE-2022-41125, which is an “elevation of privilege” vulnerability in the Windows Cryptography API: Next Generation (CNG) Key Isolation Service, a service for isolating private keys. Satnam Narang, senior staff research engineer at Tenable, said exploitation of this vulnerability could grant an attacker SYSTEM privileges.
The fourth zero-day, CVE-2022-41091, was previously disclosed and widely reported on in October. It is a Security Feature Bypass of “Windows Mark of the Web” – a mechanism meant to flag files that have come from an untrusted source.
The other two zero-day bugs Microsoft patched this month were for vulnerabilities being exploited in Exchange Server. News that these two Exchange flaws were being exploited in the wild surfaced in late September 2022, and many were surprised when Microsoft let October’s Patch Tuesday sail by without issuing official patches for them (the company instead issued mitigation instructions that it was forced to revise multiple times). Today’s patch batch addresses both issues.
Greg Wiseman, product manager at Rapid7, said the Exchange flaw CVE-2022-41040 is a “critical” elevation of privilege vulnerability, and CVE-2022-41082 is considered Important, allowing Remote Code Execution (RCE) when PowerShell is accessible to the attacker.
“Both vulnerabilities have been exploited in the wild,” Wiseman said. “Four other CVEs affecting Exchange Server have also been addressed this month. Three are rated as Important, and CVE-2022-41080 is another privilege escalation vulnerability considered Critical. Customers are advised to update their Exchange Server systems immediately, regardless of whether any previously recommended mitigation steps have been applied. The mitigation rules are no longer recommended once systems have been patched.”
Adobe usually issues security updates for its products on Patch Tuesday, but it did not this month. For a closer look at the patches released by Microsoft today and indexed by severity and other metrics, check out the always-useful Patch Tuesday roundup from the SANS Internet Storm Center. And it’s not a bad idea to hold off updating for a few days until Microsoft works out any kinks in the updates: AskWoody.com usually has the lowdown on any patches that may be causing problems for Windows users.
As always, please consider backing up your system or at least your important documents and data before applying system updates. And if you run into any problems with these updates, please drop a note about it here in the comments.
A 26-year-old Ukrainian man is awaiting extradition from The Netherlands to the United States on charges that he acted as a core developer for Raccoon, a popular “malware-as-a-service” offering that helped paying customers steal passwords and financial data from millions of cybercrime victims. KrebsOnSecurity has learned that the defendant was busted in March 2022, after fleeing mandatory military service in Ukraine in the weeks following the Russian invasion.
Ukrainian national Mark Sokolovsky, seen here in a Porsche Cayenne on Mar. 18 fleeing mandatory military service in Ukraine. This image was taken by Polish border authorities as Sokolovsky’s vehicle entered Germany. Image: KrebsOnSecurity.com.
The U.S. Attorney for the Western District of Texas unsealed an indictment last week that named Ukrainian national Mark Sokolovsky as the core developer for the Raccoon Infostealer business, which was marketed on several Russian-language cybercrime forums beginning in 2019.
Raccoon was essentially a Web-based control panel, where — for $200 a month — customers could get the latest version of the Raccoon Infostealer malware, and interact with infected systems in real time. Security experts say the passwords and other data stolen by Raccoon malware were often resold to groups engaged in deploying ransomware.
Working with investigators in Italy and The Netherlands, U.S. authorities seized a copy of the server used by Raccoon to help customers manage their botnets. According to the U.S. Justice Department, FBI agents have identified more than 50 million unique credentials and forms of identification (email addresses, bank accounts, cryptocurrency addresses, credit card numbers, etc.) stolen with the help of Raccoon.
The Raccoon v. 1 web panel, where customers could search by infected IP, and stolen cookies, wallets, domains and passwords.
The unsealed indictment (PDF) doesn’t delve much into how investigators tied Sokolovsky to Raccoon, but two sources close to the investigation shared more information about that process on condition of anonymity because they were not authorized to discuss the case publicly.
According to those sources, U.S. authorities zeroed in on an operational security mistake that the Raccoon developer made early on in his posts to the crime forums, connecting a Gmail account for a cybercrime forum identity used by the Raccoon developer (“Photix”) to an Apple iCloud account belonging to Sokolovsky. For example, the indictment includes a photo that investigators subpoenaed from Sokolovsky’s iCloud account that shows him posing with several stacks of bundled cash.
A selfie pulled from Mark Sokolovsky’s iCloud account. Image: USDOJ.
When Russia invaded Ukraine in late February 2022, Sokolovsky was living in Kharkiv, a city in northeast Ukraine that would soon come under heavy artillery bombardment from Russian forces. Authorities monitoring Sokolovsky’s iCloud account had spent weeks watching him shuttle between Kharkiv and the Ukrainian capital Kyiv, but on Mar. 18, 2022, his phone suddenly showed up in Poland.
Investigators learned from Polish border guards that Sokolovsky had fled Ukraine in a Porsche Cayenne along with a young blond woman, leaving his mother and other family behind. The image at the top of this post was shared with U.S. investigators by Polish border security officials, and it shows Sokolovsky leaving Poland for Germany on Mar. 18.
At the time, all able-bodied men of military age were required to report for service to help repel the Russian invasion, and it would have been illegal for Sokolovsky to leave Ukraine without permission. But both sources said investigators believe Sokolovsky bribed border guards to let them pass.
Authorities soon tracked Sokolovsky’s phone through Germany and eventually to The Netherlands, with his female companion helpfully documenting every step of the trip on her Instagram account. Here is a picture she posted of the two embracing upon their arrival in Amsterdam’s Dam Square:
Authorities in The Netherlands arrested Sokolovsky on Mar. 20, and quickly seized control over the Raccoon Infostealer infrastructure. Meanwhile, on March 25 the accounts that had previously advertised the Raccoon Stealer malware on cybercrime forums announced the service was closing down. The parting message to customers said nothing of an arrest, and instead insinuated that the core members in charge of the malware-as-a-service project had perished in the Russian invasion.
“Unfortunately, due to the ‘special operation,’ we will have to close our Raccoon Stealer project,” the team announced Mar. 25. “Our team members who were responsible for critical components of the product are no longer with us. Thank you for this experience and time, for every day, unfortunately everything, sooner or later, the end of the WORLD comes to everyone.”
Sokolovsky’s extradition to the United States has been granted, but he is appealing that decision. He faces one count of conspiracy to commit computer fraud; one count of conspiracy to commit wire fraud; one count of conspiracy to commit money laundering, and one count of aggravated identity theft.
Sources tell KrebsOnSecurity that Sokolovsky has been consulting with Houston, Tx.-based attorney F. Andino Reynal, the same lawyer who represented Alex Jones in the recent defamation lawsuit against Jones and his conspiracy theory website Infowars. Reynal was responsible for what Jones himself referred to as the “Perry Mason” moment of the trial, wherein the plaintiff’s lawyer revealed that Reynal had inadvertently given them an entire digital copy of Jones’s cell phone. Mr. Reynal did not respond to requests for comment.
If convicted, Sokolovsky faces a maximum penalty of 20 years in prison for the wire fraud and money laundering offenses, five years for the conspiracy to commit computer fraud charge, and a mandatory consecutive two-year term for the aggravated identity theft offense.
The Justice Department has set up a website — raccoon.ic3.gov — that allows visitors to check whether their email address shows up in the data collected by the Raccoon Stealer service.
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When U.S. consumers have their online bank accounts hijacked and plundered by hackers, U.S. financial institutions are legally obligated to reverse any unauthorized transactions as long as the victim reports the fraud in a timely manner. But new data released this week suggests that for some of the nation’s largest banks, reimbursing account takeover victims has become more the exception than the rule.
The findings came in a report released by Sen. Elizabeth Warren (D-Mass.), who in April 2022 opened an investigation into fraud tied to Zelle, the “peer-to-peer” digital payment service used by many financial institutions that allows customers to quickly send cash to friends and family.
Zelle is run by Early Warning Services LLC (EWS), a private financial services company which is jointly owned by Bank of America, Capital One, JPMorgan Chase, PNC Bank, Truist, U.S. Bank, and Wells Fargo. Zelle is enabled by default for customers at over 1,000 different financial institutions, even if a great many customers still don’t know it’s there.
Sen. Warren said several of the EWS owner banks — including Capital One, JPMorgan and Wells Fargo — failed to provide all of the requested data. But Warren did get the requested information from PNC, Truist and U.S. Bank.
“Overall, the three banks that provided complete data sets reported 35,848 cases of scams, involving over $25.9 million of payments in 2021 and the first half of 2022,” the report summarized. “In the vast majority of these cases, the banks did not repay the customers that reported being scammed. Overall these three banks reported repaying customers in only 3,473 cases (representing nearly 10% of scam claims) and repaid only $2.9 million.”
Importantly, the report distinguishes between cases that involve straight up bank account takeovers and unauthorized transfers (fraud), and those losses that stem from “fraudulently induced payments,” where the victim is tricked into authorizing the transfer of funds to scammers (scams).
A common example of the latter is the Zelle Fraud Scam, which uses an ever-shifting set of come-ons to trick people into transferring money to fraudsters. The Zelle Fraud Scam often employs text messages and phone calls spoofed to look like they came from your bank, and the scam usually relates to fooling the customer into thinking they’re sending money to themselves when they’re really sending it to the crooks.
Here’s the rub: When a customer issues a payment order to their bank, the bank is obligated to honor that order so long as it passes a two-stage test. The first question asks, Did the request actually come from an authorized owner or signer on the account? In the case of Zelle scams, the answer is yes.
Trace Fooshee, a strategic advisor in the anti money laundering practice at Aite-Novarica, said the second stage requires banks to give the customer’s transfer order a kind of “sniff test” using “commercially reasonable” fraud controls that generally are not designed to detect patterns involving social engineering.
Fooshee said the legal phrase “commercially reasonable” is the primary reason why no bank has much — if anything — in the way of controlling for scam detection.
“In order for them to deploy something that would detect a good chunk of fraud on something so hard to detect they would generate egregiously high rates of false positives which would also make consumers (and, then, regulators) very unhappy,” Fooshee said. “This would tank the business case for the service as a whole rendering it something that the bank can claim to NOT be commercially reasonable.”
Sen. Warren’s report makes clear that banks generally do not pay consumers back if they are fraudulently induced into making Zelle payments.
“In simple terms, Zelle indicated that it would provide redress for users in cases of unauthorized transfers in which a user’s account is accessed by a bad actor and used to transfer a payment,” the report continued. “However, EWS’ response also indicated that neither Zelle nor its parent bank owners would reimburse users fraudulently induced by a bad actor into making a payment on the platform.”
Still, the data suggest banks did repay at least some of the funds stolen from scam victims about 10 percent of the time. Fooshee said he’s surprised that number is so high.
“That banks are paying victims of authorized payment fraud scams anything at all is noteworthy,” he said. “That’s money that they’re paying for out of pocket almost entirely for goodwill. You could argue that repaying all victims is a sound strategy especially in the climate we’re in but to say that it should be what all banks do remains an opinion until Congress changes the law.”
However, when it comes to reimbursing victims of fraud and account takeovers, the report suggests banks are stiffing their customers whenever they can get away with it. “Overall, the four banks that provided complete data sets indicated that they reimbursed only 47% of the dollar amount of fraud claims they received,” the report notes.
How did the banks behave individually? From the report:
-In 2021 and the first six months of 2022, PNC Bank indicated that its customers reported 10,683 cases of unauthorized payments totaling over $10.6 million, of which only 1,495 cases totaling $1.46 were refunded to consumers. PNC Bank left 86% of its customers that reported cases of fraud without recourse for fraudulent activity that occurred on Zelle.
-Over this same time period, U.S. Bank customers reported a total of 28,642 cases of unauthorized transactions totaling over $16.2 million, while only refunding 8,242 cases totaling less than $4.7 million.
-In the period between January 2021 and September 2022, Bank of America customers reported 81,797 cases of unauthorized transactions, totaling $125 million. Bank of America refunded only $56.1 million in fraud claims – less than 45% of the overall dollar value of claims made in that time.
–Truist indicated that the bank had a much better record of reimbursing defrauded customers over this same time period. During 2021 and the first half of 2022, Truist customers filed 24,752 unauthorized transaction claims amounting to $24.4 million. Truist reimbursed 20,349 of those claims, totaling $20.8 million – 82% of Truist claims were reimbursed over this period. Overall, however, the four banks that provided complete data sets indicated that they reimbursed only 47% of the dollar amount of fraud claims they received.
Fooshee said there has long been a great deal of inconsistency in how banks reimburse unauthorized fraud claims — even after the Consumer Financial Protection Bureau (CPFB) came out with guidance on what qualifies as an unauthorized fraud claim.
“Many banks reported that they were still not living up to those standards,” he said. “As a result, I imagine that the CFPB will come down hard on those with fines and we’ll see a correction.”
Fooshee said many banks have recently adjusted their reimbursement policies to bring them more into line with the CFPB’s guidance from last year.
“So this is heading in the right direction but not with sufficient vigor and speed to satisfy critics,” he said.
Seth Ruden is a payments fraud expert who serves as director of global advisory for digital identity company BioCatch. Ruden said Zelle has recently made “significant changes to its fraud program oversight because of consumer influence.”
“It is clear to me that despite sensational headlines, progress has been made to improve outcomes,” Ruden said. “Presently, losses in the network on a volume-adjusted basis are lower than those typical of credit cards.”
But he said any failure to reimburse victims of fraud and account takeovers only adds to pressure on Congress to do more to help victims of those scammed into authorizing Zelle payments.
“The bottom line is that regulations have not kept up with the speed of payment technology in the United States, and we’re not alone,” Ruden said. “For the first time in the UK, authorized payment scam losses have outpaced credit card losses and a regulatory response is now on the table. Banks have the choice right now to take action and increase controls or await regulators to impose a new regulatory environment.”
Sen. Warren’s report is available here (PDF).
There are, of course, some versions of the Zelle fraud scam that may be confusing financial institutions as to what constitutes “authorized” payment instructions. For example, the variant I wrote about earlier this year began with a text message that spoofed the target’s bank and warned of a pending suspicious transfer.
Those who responded at all received a call from a number spoofed to make it look like the victim’s bank calling, and were asked to validate their identities by reading back a one-time password sent via SMS. In reality, the thieves had simply asked the bank’s website to reset the victim’s password, and that one-time code sent via text by the bank’s site was the only thing the crooks needed to reset the target’s password and drain the account using Zelle.
None of the above discussion involves the risks affecting businesses that bank online. Businesses in the United States do not enjoy the same fraud liability protection afforded to consumers, and if a banking trojan or clever phishing site results in a business account getting drained, most banks will not reimburse that loss.
This is why I have always and will continue to urge small business owners to conduct their online banking affairs only from a dedicated, access restricted and security-hardened device — and preferably a non-Windows machine.
For consumers, the same old advice remains the best: Watch your bank statements like a hawk, and immediately report and contest any charges that appear fraudulent or unauthorized.
FreshRSS