Tag Archive for: Cyber

3CX Breach Was a Double Supply Chain Compromise

We learned some remarkable new details this week about the recent supply-chain attack on VoIP software provider 3CX. The lengthy, complex intrusion has all the makings of a cyberpunk spy novel: North Korean hackers using legions of fake executive accounts on LinkedIn to lure people into opening malware disguised as a job offer; malware targeting Mac and Linux users working at defense and cryptocurrency firms; and software supply-chain attacks nested within earlier supply chain attacks.

Researchers at ESET say this job offer from a phony HSBC recruiter on LinkedIn was North Korean malware masquerading as a PDF file.

In late March 2023, 3CX disclosed that its desktop applications for both Windows and macOS were compromised with malicious code that gave attackers the ability to download and run code on all machines where the app was installed. 3CX says it has more than 600,000 customers and 12 million users in a broad range of industries, including aerospace, healthcare and hospitality.

3CX hired incident response firm Mandiant, which released a report on Wednesday that said the compromise began in 2022 when a 3CX employee installed a malware-laced software package distributed via an earlier software supply chain compromise that began with a tampered installer for X_TRADER, a software package provided by Trading Technologies.

“This is the first time Mandiant has seen a software supply chain attack lead to another software supply chain attack,” reads the April 20 Mandiant report.

Mandiant found the earliest evidence of compromise uncovered within 3CX’s network was through the VPN using the employee’s corporate credentials, two days after the employee’s personal computer was compromised.

“Eventually, the threat actor was able to compromise both the Windows and macOS build environments,” 3CX said in an April 20 update on their blog.

Mandiant concluded that the 3CX attack was orchestrated by the North Korean state-sponsored hacking group known as Lazarus, a determination that was independently reached earlier by researchers at Kaspersky Lab and Elastic Security.

Mandiant found the compromised 3CX software would download malware that sought out new instructions by consulting encrypted icon files hosted on GitHub. The decrypted icon files revealed the location of the malware’s control server, which was then queried for a third stage of the malware compromise — a password stealing program dubbed ICONICSTEALER.

The double supply chain compromise that led to malware being pushed out to some 3CX customers. Image: Mandiant.

Meanwhile, the security firm ESET today published research showing remarkable similarities between the malware used in the 3CX supply chain attack and Linux-based malware that was recently deployed via fake job offers from phony executive profiles on LinkedIn. The researchers said this was the first time Lazarus had been spotted deploying malware aimed at Linux users.

As reported in a recent series last summer here, LinkedIn has been inundated this past year by fake executive profiles for people supposedly employed at a range of technology, defense, energy and financial companies. In many cases, the phony profiles spoofed chief information security officers at major corporations, and some attracted quite a few connections before their accounts were terminated.

Mandiant, Proofpoint and other experts say Lazarus has long used these bogus LinkedIn profiles to lure targets into opening a malware-laced document that is often disguised as a job offer. This ongoing North Korean espionage campaign using LinkedIn was first documented in August 2020 by ClearSky Security, which said the Lazarus group operates dozens of researchers and intelligence personnel to maintain the campaign globally.

Microsoft Corp., which owns LinkedIn, said in September 2022 that it had detected a wide range of social engineering campaigns using a proliferation of phony LinkedIn accounts. Microsoft said the accounts were used to impersonate recruiters at technology, defense and media companies, and to entice people into opening a malicious file. Microsoft found the attackers often disguised their malware as legitimate open-source software like Sumatra PDF and the SSH client Putty.

Microsoft attributed those attacks to North Korea’s Lazarus hacking group, although they’ve traditionally referred to this group as “ZINC“. That is, until earlier this month, when Redmond completely revamped the way it names threat groups; Microsoft now references ZINC as “Diamond Sleet.”

The ESET researchers said they found a new fake job lure tied to an ongoing Lazarus campaign on LinkedIn designed to compromise Linux operating systems. The malware was found inside of a document that offered an employment contract at the multinational bank HSBC.

“A few weeks ago, a native Linux payload was found on VirusTotal with an HSBC-themed PDF lure,” wrote ESET researchers Peter Kalnai and Marc-Etienne M.Leveille. “This completes Lazarus’s ability to target all major desktop operating systems. In this case, we were able to reconstruct the full chain, from the ZIP file that delivers a fake HSBC job offer as a decoy, up until the final payload.”

ESET said the malicious PDF file used in the scheme appeared to have a file extension of “.pdf,” but that this was a ruse. ESET discovered that the dot in the filename wasn’t a normal period but instead a Unicode character (U+2024) representing a “leader dot,” which is often used in tables of contents to connect section headings with the page numbers on which those sections begin.

“The use of the leader dot in the filename was probably an attempt to trick the file manager into treating the file as an executable instead of a PDF,” the researchers continued. “This could cause the file to run when double-clicked instead of opening it with a PDF viewer.”

ESET said anyone who opened the file would see a decoy PDF with a job offer from HSBC, but in the background the executable file would download additional malware payloads. The ESET team also found the malware was able to manipulate the program icon displayed by the malicious PDF, possibly because fiddling with the file extension could cause the user’s system to display a blank icon for the malware lure.

Kim Zetter, a veteran Wired.com reporter and now independent security journalist, interviewed Mandiant researchers who said they expect “many more victims” will be discovered among the customers of Trading Technologies and 3CX now that news of the compromised software programs is public.

“Mandiant informed Trading Technologies on April 11 that its X_Trader software had been compromised, but the software maker says it has not had time to investigate and verify Mandiant’s assertions,” Zetter wrote in her Zero Day newsletter on Substack. For now, it remains unclear whether the compromised X_Trader software was downloaded by people at other software firms.

If there’s a silver lining here, the X_Trader software had been decommissioned in April 2020 — two years before the hackers allegedly embedded malware in it.

“The company hadn’t released new versions of the software since that time and had stopped providing support for the product, making it a less-than-ideal vector for the North Korean hackers to infect customers,” Zetter wrote.

Giving a Face to the Malware Proxy Service ‘Faceless’

For the past seven years, a malware-based proxy service known as “Faceless” has sold anonymity to countless cybercriminals. For less than a dollar per day, Faceless customers can route their malicious traffic through tens of thousands of compromised systems advertised on the service. In this post we’ll examine clues left behind over the past decade by the proprietor of Faceless, including some that may help put a face to the name.

The proxy lookup page inside the malware-based anonymity service Faceless. Image: spur.us.

Riley Kilmer is co-founder of Spur.us, a company that tracks thousands of VPN and proxy networks, and helps customers identify traffic coming through these anonymity services. Kilmer said Faceless has emerged as one of the underground’s most reliable malware-based proxy services, mainly because its proxy network has traditionally included a great many compromised “Internet of Things” devices — such as media sharing servers — that are seldom included on malware or spam block lists.

Kilmer said when Spur first started looking into Faceless, they noticed almost every Internet address that Faceless advertised for rent also showed up in the IoT search engine Shodan.io as a media sharing device on a local network that was somehow exposed to the Internet.

“We could reliably look up the [fingerprint] for these media sharing devices in Shodan and find those same systems for sale on Faceless,” Kilmer said.

In January 2023, the Faceless service website said it was willing to pay for information about previously undocumented security vulnerabilities in IoT devices. Those with IoT zero-days could expect payment if their exploit involved at least 5,000 systems that could be identified through Shodan.

Notices posted for Faceless users, advertising an email flooding service and soliciting zero-day vulnerabilities in Internet of Things devices.

Recently, Faceless has shown ambitions beyond just selling access to poorly-secured IoT devices. In February, Faceless re-launched a service that lets users drop an email bomb on someone — causing the target’s inbox to be filled with tens of thousands of junk messages.

And in March 2023, Faceless started marketing a service for looking up Social Security Numbers (SSNs) that claims to provide access to “the largest SSN database on the market with a very high hit rate.”

Kilmer said Faceless wants to become a one-stop-fraud-shop for cybercriminals who are seeking stolen or synthetic identities from which to transact online, and a temporary proxy that is geographically close to the identity being sold. Faceless currently sells this bundled product for $9 — $8 for the identity and $1 for the proxy.

“They’re trying to be this one-stop shop for anonymity and personas,” Kilmer said. “The service basically says ‘here’s an SSN and proxy connection that should correspond to that user’s location and make sense to different websites.’”

MRMURZA

Faceless is a project from MrMurza, a particularly talkative member of more than a dozen Russian-language cybercrime forums over the past decade. According to cyber intelligence firm Flashpoint, MrMurza has been active in the Russian underground since at least September 2012. Flashpoint said MrMurza appears to be extensively involved in botnet activity and “drops” — fraudulent bank accounts created using stolen identity data that are often used in money laundering and cash-out schemes.

Faceless grew out of a popular anonymity service called iSocks, which was launched in 2014 and advertised on multiple Russian crime forums as a proxy service that customers could use to route their malicious Web traffic through compromised computers.

Flashpoint says that in the months before iSocks went online, MrMurza posted on the Russian language crime forum Verified asking for a serious partner to assist in opening a proxy service, noting they had a botnet that was powered by malware that collected proxies with a 70 percent infection rate.

MrMurza’s Faceless advertised on the Russian-language cybercrime forum ProCrd. Image: Darkbeast/Ke-la.com.

In September 2016, MrMurza sent a message to all iSocks users saying the service would soon be phased out in favor of Faceless, and that existing iSocks users could register at Faceless for free if they did so quickly — before Faceless began charging new users registration fees between $50 and $100.

Verified and other Russian language crime forums where MrMurza had a presence have been hacked over the years, with contact details and private messages leaked online. In a 2014 private message to the administrator of Verified explaining his bona fides, MrMurza said he received years of positive feedback as a seller of stolen Italian credit cards and a vendor of drops services.

MrMurza told the Verified admin that he used the nickname AccessApproved on multiple other forums over the years. MrMurza also told the admin that his account number at the now-defunct virtual currency Liberty Reserve was U1018928.

According to cyber intelligence firm Intel 471, the user AccessApproved joined the Russian crime forum Zloy in Jan. 2012, from an Internet address in Magnitogorsk, RU. In a 2012 private message where AccessApproved was arguing with another cybercriminal over a deal gone bad, AccessApproved asked to be paid at the Liberty Reserve address U1018928.

In 2013, U.S. federal investigators seized Liberty Reserve and charged its founders with facilitating billions of dollars in money laundering tied to cybercrime. The Liberty Reserve case was prosecuted out of the Southern District of New York, which in 2016 published a list of account information (PDF) tied to thousands of Liberty Reserve addresses the government asserts were involved in money laundering.

That document indicates the Liberty Reserve account claimed by MrMurza/AccessApproved — U1018928 — was assigned in 2011 to a “Vadim Panov” who used the email address lesstroy@mgn.ru.

PANOV

Constella Intelligence, a threat intelligence firm that tracks breached databases, says lesstroy@mgn.ru was used for an account “Hackerok” at the accounting service klerk.ru that was created from an Internet address in Magnitogorsk. The password chosen by this user was “1232.”

In addition to selling access to hacked computers and bank accounts, both MrMurza and AccessApproved ran side hustles on the crime forums selling clothing from popular retailers that refused to ship directly to Russia.

On one cybercrime forum where AccessApproved had clothing customers, denizens of the forum created a lengthy discussion thread to help users identify incoming emails associated with various reshipping services advertised within their community. Reshippers tend to rely on a large number of people in the United States and Europe helping to forward packages overseas, but in many cases the notifications about purchases and shipping details would be forwarded to reshipping service customers from a consistent email account.

That thread said AccessApproved’s clothing reshipping service forwarded confirmation emails from the address panov-v@mail.ru. This address is associated with accounts on two Russian cybercrime forums registered from Magnitogorsk in 2010 using the handle “Omega^gg4u.”

This Omega^gg4u identity sold software that can rapidly check the validity of large batches of stolen credit cards. Interestingly, both Omega^gg4u and AccessApproved also had another niche: Reselling heavily controlled substances — such as human growth hormone and anabolic steroids — from chemical suppliers in China.

A search in Constella on the address panov-v@mail.ru and many variations on that address shows these accounts cycled through the same passwords, including 055752403k, asus666, 01091987h, and the relatively weak password 1232 (recall that 1232 was picked by whoever registered the lesstroy@mgn.ru account at Klerk.ru).

Constella says the email address asus666@yandex.ru relied on the passwords asus666 and 01091987h. The 01091987h password also was used by asus666@mail.ru, which also favored the password 24587256.

Constella further reports that whoever owned the much shorter address asus@mail.ru also used the password 24587256. In addition, it found the password 2318922479 was tied to both asus666@mail.ru and asus@mail.ru.

The email addresses asus@mail.ru, asus2504@mail.ru, and zaxar2504@rambler.ru were all used to register Vkontakte social media accounts for a Denis ***@VIP*** Pankov. There are a number of other Vkontakte accounts registered to asus@mail.ru and many variations of this address under a different name. But none of those other profiles appear tied to real-life identities.

A mind map simplifying the research detailed here.

PANKOV

Constella’s data shows the email addresses asus2504@mail.ru and zaxar2504@rambler.ru used the rather unique password denis250485, which was also used by the email address denispankov@yandex.ru and almost a dozen variations at other Russian-language email providers.

Russian vehicle registration records from 2016 show the email address denispankov@yandex.ru belongs to Denis Viktorovich Pankov, born on April 25, 1985. That explains the “250485” portion of Pankov’s favored password. The registration records further indicate that in 2016 Pankov’s vehicle was registered in a suburb of Moscow.

Russian incorporation records show that denispankov@yandex.com is tied to IP Pankov Denis Viktorovich, a now-defunct transportation company in the Volograd Oblast, a region in southern Russia that shares a long border with western Kazazkhstan.

More recent records for IP Pankov Denis Viktorovich show a microenterprise with this name in Omsk that described its main activity as “retail sale by mail or via the Internet.” Russian corporate records indicate this entity was liquidated in 2021.

A reverse password search on “denis250485” via Constella shows this password was used by more than 75 email addresses, most of which are some variation of gaihnik@mail.ru — such as gaihnik25@mail.ru, or gaihnik2504@rambler.ru.

In 2012, someone posted answers to a questionnaire on behalf of Denis Viktorovich Pankov to a Russian-language discussion forum on Chinese crested dog breeds. The message said Pankov was seeking a puppy of a specific breed and was a resident of Krasnogorsk, a city that is adjacent to the northwestern boundary of Moscow.

The message said Pankov was a then 27-year-old manager in an advertising company, and could be reached at the email address gaihnik@mail.ru.

GAIHNIK

Constella Intelligence shows gaihnik@mail.ru registered at the now-defunct email marketing service Smart Responder from an address in Gagarin, which is about 115 miles west of Moscow.

Back in 2015, the user Gaihnik25 was banned from the online game World of Tanks for violating the game’s terms that prohibit “bot farming,” or the automated use of large numbers of player accounts to win some advantage that is usually related to cashing out game accounts or inventory.

For the past few years, someone using the nickname Gaihnik25 has been posting messages to the Russian-language hacking forum Gerki[.]pw, on discussion threads regarding software designed to “brute force” or mass-check online accounts for weak or compromised passwords.

A new member of the Russian hacking forum Nohide[.]Space using the handle Gaihnik has been commenting recently about proxy services, credential checking software, and the sale of hacked mailing lists. Gaihnik’s first post on the forum concerned private software for checking World of Tanks accounts.

The address gaihnik@mail.ru shows how so many email addresses tied to Pankov were also connected to apparently misleading identities on Vkontakte and elsewhere. Constella found this address was tied to a Vkontakte account for a Dmitriy Zakarov.

Microsoft’s Bing search engine says gaihnik@mail.ru belongs to 37-year-old Denis Pankov, yet clicking the Mail.ru profile for that user brings up a profile for a much older man by the name Gavril Zakarov. However, when you log in to a Mail.ru account and view that profile, it shows that most of the account’s profile photos are of a much younger man.

Many of those same photos show up in an online dating profile at dating.ru for the user Gaihnik, a.k.a “Denchik,” who says he is a 37-year-old Taurus from Gagarin who enjoys going for walks in nature, staying up late, and being on the Internet.

Mr. Pankov did not respond to multiple requests for comment sent to all of the email addresses mentioned in this story. However, some of those addresses produced detailed error responses; Mail.ru reported that the users panov-v@mail.ru, asus666@mail.ru, and asus2504@mail.ru were terminated, and that gaihnik25@mail.ru is now disabled.

Messages sent to many other email addresses connected via passwords to Pankov and using some variation of asus####@mail.ru also returned similar account termination messages.

Why is ‘Juice Jacking’ Suddenly Back in the News?

KrebsOnSecurity received a nice bump in traffic this week thanks to tweets from the Federal Bureau of Investigation (FBI) and the Federal Communications Commission (FCC) about “juice jacking,” a term first coined here in 2011 to describe a potential threat of data theft when one plugs their mobile device into a public charging kiosk. It remains unclear what may have prompted the alerts, but the good news is that there are some fairly basic things you can do to avoid having to worry about juice jacking.

On April 6, 2023, the FBI’s Denver office issued a warning about juice jacking in a tweet.

“Avoid using free charging stations in airports, hotels or shopping centers,” the FBI’s Denver office warned. “Bad actors have figured out ways to use public USB ports to introduce malware and monitoring software onto devices. Carry your own charger and USB cord and use an electrical outlet instead.”

Five days later, the Federal Communications Commission (FCC) issued a similar warning. “Think twice before using public charging stations,” the FCC tweeted. “Hackers could be waiting to gain access to your personal information by installing malware and monitoring software to your devices. This scam is referred to as juice jacking.”

The FCC tweet also provided a link to the agency’s awareness page on juice jacking, which was originally published in advance of the Thanksgiving Holiday in 2019 but was updated in 2021 and then again shortly after the FBI’s tweet was picked up by the news media. The alerts were so broadly and breathlessly covered in the press that a mention of juice jacking even made it into this week’s Late Late Show with James Corden.

The term juice jacking crept into the collective paranoia of gadget geeks in the summer of 2011, thanks to the headline for a story here about researchers at the DEFCON hacker convention in Vegas who’d set up a mobile charging station designed to educate the unwary to the reality that many mobile devices connected to a computer would sync their data by default.

Since then, Apple, Google and other mobile device makers have changed the way their hardware and software works so that their devices no longer automatically sync data when one plugs them into a computer with a USB charging cable. Instead, users are presented with a prompt asking if they wish to trust a connected computer before any data transfer can take place.

On the other hand, the technology needed to conduct a sneaky juice jacking attack has become far more miniaturized, accessible and cheap. And there are now several products anyone can buy that are custom-built to enable juice jacking attacks.

Probably the best known example is the OMG cable, a $180 hacking device made for professional penetration testers that looks more or less like an Apple or generic USB charging cable. But inside the OMG cable is a tiny memory chip and a Wi-Fi transmitter that creates a Wi-Fi hotspot, to which the attacker can remotely connect using a smartphone app and run commands on the device.

The $180 “OMG cable.” Image: hak5.org.

Brian Markus is co-founder of Aries Security, and one of the researchers who originally showcased the threat from juice jacking at the 2011 DEFCON. Markus said he isn’t aware of any public accounts of juice jacking kiosks being found in the wild, and said he’s unsure what prompted the recent FBI alert.

But Markus said juice jacking is still a risk because it is far easier and cheaper these days for would-be attackers to source and build the necessary equipment.

“Since then, the technology and components have become much smaller and very easy to build, which puts this in the hands of less sophisticated threat actors,” Markus said. “Also, you can now buy all this stuff over the counter. I think the risk is possibly higher now than it was a decade ago, because a much larger population of people can now pull this off easily.”

How seriously should we take the recent FBI warning? An investigation by the myth-busting site Snopes suggests the FBI tweet was just a public service announcement based on a dated advisory. Snopes reached out to both the FBI and the FCC to request data about how widespread the threat of juice jacking is in 2023.

“The FBI replied that its tweet was a ‘standard PSA-type post’ that stemmed from the FCC warning,” Snopes reported. “An FCC spokesperson told Snopes that the commission wanted to make sure that their advisory on “juice-jacking,” first issued in 2019 and later updated in 2021, was up-to-date so as to ensure ‘the consumers have the most up-to-date information.’ The official, who requested anonymity, added that they had not seen any rise in instances of consumer complaints about juice-jacking.”

What can you do to avoid juice jacking? Bring your own gear. A general rule of thumb in security is that if an adversary has physical access to your device, you can no longer trust the security or integrity of that device. This also goes for things that plug into your devices.

Juice jacking isn’t possible if a device is charged via a trusted AC adapter, battery backup device, or through a USB cable with only power wires and no data wires present. If you lack these things in a bind and still need to use a public charging kiosk or random computer, at least power your device off before plugging it in.

Microsoft (& Apple) Patch Tuesday, April 2023 Edition

Microsoft today released software updates to plug 100 security holes in its Windows operating systems and other software, including a zero-day vulnerability that is already being used in active attacks. Not to be outdone, Apple has released a set of important updates addressing two zero-day vulnerabilities that are being used to attack iPhones, iPads and Macs.

On April 7, Apple issued emergency security updates to fix two weaknesses that are being actively exploited, including CVE-2023-28206, which can be exploited by apps to seize control over a device. CVE-2023-28205 can be used by a malicious or hacked website to install code.

Both vulnerabilities are addressed in iOS/iPadOS 16.4.1, iOS 15.7.5, and macOS 12.6.5 and 11.7.6. If you use Apple devices and you don’t have automatic updates enabled (they are on by default), you should probably take care of that soon as detailed instructions on how to attack CVE-2023-28206 are now public.

Microsoft’s bevy of 100 security updates released today include CVE-2023-28252, which is a weakness in Windows that Redmond says is under active attack. The vulnerability is in the Windows Common Log System File System (CLFS) driver, a core Windows component that was the source of attacks targeting a different zero-day vulnerability in February 2023.

“If it seems familiar, that’s because there was a similar 0-day patched in the same component just two months ago,” said Dustin Childs at the Trend Micro Zero Day Initiative. “To me, that implies the original fix was insufficient and attackers have found a method to bypass that fix. As in February, there is no information about how widespread these attacks may be. This type of exploit is typically paired with a code execution bug to spread malware or ransomware.”

According to the security firm Qualys, this vulnerability has been leveraged by cyber criminals to deploy Nokoyawa ransomware.

“This is a relatively new strain for which there is some open source intel to suggest that it is possibly related to Hive ransomware – one of the most notable ransomware families of 2021 and linked to breaches of over 300+ organizations in a matter of just a few months,” said Bharat Jogi, director of vulnerability and threat research at Qualys.

Jogi said while it is still unclear which exact threat actor is targeting CVE-2023-28252, targets have been observed in South and North America, regions across Asia and at organizations in the Middle East.

Satnam Narang at Tenable notes that CVE-2023-28252 is also the second CLFS zero-day disclosed to Microsoft by researchers from Mandiant and DBAPPSecurity (CVE-2022-37969), though it is unclear if both of these discoveries are related to the same attacker.

Seven of the 100 vulnerabilities Microsoft fixed today are rated “Critical,” meaning they can be used to install malicious code with no help from the user. Ninety of the flaws earned Redmond’s slightly less-dire “Important” label, which refers to weaknesses that can be used to undermine the security of the system but which may require some amount of user interaction.

Narang said Microsoft has rated nearly 90% of this month’s vulnerabilities as “Exploitation Less Likely,” while just 9.3% of flaws were rated as “Exploitation More Likely.” Kevin Breen at Immersive Labs zeroed in on several notable flaws in that 9.3%, including CVE-2023-28231, a remote code execution vulnerability in a core Windows network process (DHCP) with a CVSS score of 8.8.

“‘Exploitation more likely’ means it’s not being actively exploited but adversaries may look to try and weaponize this one,” Breen said. “Micorosft does note that successful exploitation requires an attacker to have already gained initial access to the network. This could be via social engineering, spear phishing attacks, or exploitation of other services.”

Breen also called attention to CVE-2023-28220 and CVE-2023-28219 — a pair of remote code execution vulnerabilities affecting Windows Remote Access Servers (RAS) that also earned Microsoft’s “exploitation more likely” label.

“An attacker can exploit this vulnerability by sending a specially crafted connection request to a RAS server, which could lead to remote code execution,” Breen said. While not standard in all organizations, RAS servers typically have direct access from the Internet where most users and services are connected. This makes it extremely enticing for attackers as they don’t need to socially engineer their way into an organization. They can simply scan the internet for RAS servers and automate the exploitation of vulnerable devices.”

For more details on the updates released today, see the SANS Internet Storm Center roundup. If today’s updates cause any stability or usability issues in Windows, AskWoody.com will likely have the lowdown on that.

Please consider backing up your data and/or imaging your system before applying any updates. And feel free to sound off in the comments if you experience any problems as a result of these patches.

FBI Seizes Bot Shop ‘Genesis Market’ Amid Arrests Targeting Operators, Suppliers

Several domain names tied to Genesis Market, a bustling cybercrime store that sold access to passwords and other data stolen from millions of computers infected with malicious software, were seized by the Federal Bureau of Investigation (FBI) today. Sources tell KrebsOnsecurity the domain seizures coincided with “dozens” of arrests in the United States and abroad targeting those who allegedly operated the service, as well as suppliers who continuously fed Genesis Market with freshly-stolen data.

Several websites tied to the cybercrime store Genesis Market had their homepages changed today to this seizure notice.

Active since 2018, Genesis Market’s slogan was, “Our store sells bots with logs, cookies, and their real fingerprints.” Customers could search for infected systems with a variety of options, including by Internet address or by specific domain names associated with stolen credentials.

But earlier today, multiple domains associated with Genesis had their homepages replaced with a seizure notice from the FBI, which said the domains were seized pursuant to a warrant issued by the U.S. District Court for the Eastern District of Wisconsin.

The U.S. Attorney’s Office for the Eastern District of Wisconsin did not respond to requests for comment. The FBI declined to comment.

But sources close to the investigation tell KrebsOnSecurity that law enforcement agencies in the United States, Canada and across Europe are currently serving arrest warrants on dozens of individuals thought to support Genesis, either by maintaining the site or selling the service bot logs from infected systems.

The seizure notice includes the seals of law enforcement entities from several countries, including Australia, Canada, Denmark, Germany, the Netherlands, Spain, Sweden and the United Kingdom.

When Genesis customers purchase a bot, they’re purchasing the ability to have all of the victim’s authentication cookies loaded into their browser, so that online accounts belonging to that victim can be accessed without the need of a password, and in some cases without multi-factor authentication.

“You can buy a bot with a real fingerprint, access to e-mail, social networks, bank accounts, payment systems!,” a cybercrime forum ad for Genesis enthused. “You also get all previous digital life (history) of the bot – most services won’t even ask for login and password and identify you as their returning customer. Purchasing a bot kit with the fingerprint, cookies and accesses, you become the unique user of all his or her services and other web-sites. The other use of our kit of real fingerprints is to cover-up the traces of your real internet activity.”

The Genesis Store had more than 450,000 bots for sale as of Mar. 21, 2023. Image: KrebsOnSecurity.

The pricing for Genesis bots ranged quite a bit, but in general bots with large amounts of passwords and authentication cookies — or those with access to specific financial websites such as PayPal and Coinbase — tended to fetch far higher prices.

New York based cyber intelligence firm Flashpoint says that in addition to containing a large number of resources, the most expensive bots overwhelmingly seem to have access to accounts that are easy to monetize.

“The high incidence of Google and Facebook is expected, as they are such widely used platforms,” Flashpoint noted in an analysis of Genesis Market, observing that all ten of the ten most expensive bots at the time included Coinbase credentials.

Genesis Market has introduced a number of cybercriminal innovations throughout its existence. Probably the best example is Genesis Security, which is a custom Web browser plugin which can load a Genesis bot profile so that the browser mimics virtually every important aspect of the victim’s device, from screen size and refresh rate to the unique user agent string tied to the victim’s web browser.

Flashpoint said the administrators of Genesis Market claim they are a team of specialists with “extensive experience in the field of systems metrics.” They say they developed the Genesis Security software by analyzing the top forty-seven browser fingerprinting and tracking systems, as well as those utilized by 283 different banking and payment systems.

Cybersecurity experts say Genesis and a handful of other bot shops are also popular among cybercriminals who work to identify and purchase bots inside corporate networks, and then turn around and resell that access to ransomware gangs.

Michael Debolt, chief intelligence officer for Intel 471, said so-called “network access brokers” will scour automated bot shops for high value targets, and then resell them for a bigger profit.

“From ‘used’ or ‘processed’ logs — it is actually quite common for the same log to be used by multiple different actors who are all using it for different purposes – for instance, some actors are only interested in crypto wallet or banking credentials so they bypass credentials that network access brokers are interested in,” Debolt said. “These network access brokers buy these ‘used’ logs for very cheap (or sometimes for free) and search for big fish targets from there.”

In June 2021, hackers who broke into and stole a wealth of source code and game data from the computer gaming giant EA told Motherboard they gained access by purchasing a $10 bot from Genesis Market that let them log into a company Slack account.

One feature of Genesis that sets it apart from other bot shops is that customers can retain access to infected systems in real-time, so that if the rightful owner of an infected system creates a new account online, those new credentials will get stolen and displayed in the web-based panel of the Genesis customer who purchased that bot.

“While some infostealers are designed to remove themselves after execution, others create persistent access,” reads a March 2023 report from cybersecurity firm SpyCloud. “That means bad actors have access to the current data for as long as the device remains infected, even if the user changes passwords.

SpyCloud says Genesis even advertises its commitment to keep the stolen data and the compromised systems’ fingerprints up to date.

“According to our research, Genesis Market had more than 430,000 stolen identities for sale as of early last year – and there are many other marketplaces like this one,” the SpyCloud report concludes.

This is a developing story. Any updates will be added with notice and timestamp here.

A Serial Tech Investment Scammer Takes Up Coding?

John Clifton Davies, a 60-year-old con man from the United Kingdom who fled the country in 2015 before being sentenced to 12 years in prison for fraud, has enjoyed a successful life abroad swindling technology startups by pretending to be a billionaire investor. Davies’ newest invention appears to be “CodesToYou,” which purports to be a “full cycle software development company” based in the U.K.

The scam artist John Bernard a.k.a. Alan John Mykailov (left) in a recent Zoom call, and a mugshot of John Clifton Davies from nearly a decade earlier.

Several articles here have delved into the history of John Bernard, the pseudonym used by a fake billionaire technology investor who tricked dozens of startups into giving him tens of millions of dollars.

John Bernard’s real name is John Clifton Davies, a convicted fraudster from the United Kingdom who is currently a fugitive from justice. For several years until reinventing himself again quite recently, Bernard pretended to be a billionaire Swiss investor who made his fortunes in the dot-com boom 20 years ago.

The Private Office of John Bernard” let it be known to investment brokers that he had tens of millions of dollars to invest in tech startups, and he attracted a stream of new victims by offering extraordinarily generous finder’s fees to brokers who helped him secure new clients. But those brokers would eventually get stiffed because Bernard’s company would never consummate a deal.

John Bernard’s former website, where he pretended to be a billionaire tech investor.

Bernard would promise to invest millions in tech startups, and then insist that companies pay tens of thousands of dollars worth of due diligence fees up front. However, the due diligence company he insisted on using — another Swiss firm called The Inside Knowledge GmbH — also was secretly owned by Bernard, who would invariably pull out of the deal after receiving the due diligence money.

A variety of clues suggest Davies has recently adopted at least one other identity — Alan John Mykhailov — who is listed as chairman of a British concern called CodesToYou LTD, incorporated in May 2022. The CodesToYou website says the company employs talented coders in several countries, and that its programmers offer “your ultimate balance between speed, cost and quality.”

The team from CodesToYou.

In response to questions from KrebsOnSecurity, CodesToYou’s marketing manager — who gave their name only as “Zhena” — said the company was not affiliated with any John Bernard or John Clifton Davies, and maintained that CodesToYou is a legitimate enterprise.

But publicly available information about this company and its leadership suggests otherwise. Official incorporation documents from the U.K.’s Companies House represent that CodesToYou is headed by an Alan John Mykhailov, a British citizen born in March 1958.

Companies House says Mykhailov is an officer in three other companies, including one called Blackstone Corporate Alliance Ltd. According to the Swiss business tracking service business-monitor.ch, Blackstone Corporate Alliance Ltd. is currently the entity holding a decision-making role in John Bernard’s fake due diligence company — The Inside Knowledge GmbH — which is now in liquidation.

A screen shot of the stock photos and corporate-speak on John Bernard’s old website. Image: Archive.org

Also listed as a partner in Blackstone Corporate Alliance Limited is Igor Hubskyi (a.k.a. Igor Gubskyi), a Ukrainian man who was previously president of The Inside Knowledge GmbH.

The CodesToYou website says the company’s marketing team lead is Maria Yakovleva, and the photo of this employee matches the profile for the LinkedIn account name “Maria Y.” That same LinkedIn profile and photo previously listed Maria by a different first and last name — Mariya Kulikova; back then, Ms. Kulikova’s LinkedIn profile said she was an executive assistant in The Private Office of Mr. John Bernard.

Companies House lists Alan John Mykhailov as a current officer in two other companies, including Frisor Limited, and Ardelis Solutions Limited. A cached copy of the now-defunct Ardelis Solutions website says it was a private equity firm.

CodesToYou’s Maria also included Ardelis Solutions in the work history section of her LinkedIn resume. That is, until being contacted by this author on LinkedIn, after which Maria’s profile picture and any mention of Ardelis Solutions were deleted.

Listed as head of business development at CodesToYou is David Bruno, a Canadian man whose LinkedIn profile says he is founder of an organization called “World Privacy Resource.” As KrebsOnSecurity reported in 2020, Bruno was at the time promoting himself as the co-CEO of a company called SafeSwiss Secure Communication AG, and the founder of another tech startup called Secure Swiss Data.

Secure Swiss Data’s domain — secureswissdata.com — is a Swiss concern that sells encrypted email and data services. According to DomainTools.com, that website name was registered in 2015 by The Inside Knowledge GmbH. In February 2020, a press release announced that Secure Swiss Data was purchased in an “undisclosed multimillion buyout” by SafeSwiss Secure Communication AG.

A cached copy of the Ardelis Solutions website, which said it was a private equity firm and included similar stock images as John Bernard’s investment website.

When reached in 2020 and asked about his relationship to Mr. Bernard, Mr. Bruno said the two were business partners and that he couldn’t imagine that Mr. Bernard would be involved in anything improper. To this day Mr. Bruno is the only person I’ve spoken to who has had anything positive to say about Mr. Bernard.

Mr. Bruno did not respond to requests for comment this time around, but his LinkedIn profile no longer makes any mention of Secure Swiss Data or SafeSwiss — both companies he claimed to run for many years. Nor does it mention CodesToYou. However, Mr. Bruno’s former company SafeSwiss is listed as one of the six “portfolio” companies whose services are promoted on the CodesToYou website.

In mid-2021, Bruno announced he was running for public office in Ontario.

“The Kenora resident is no stranger to the government as he contributed to Canada’s new Digital Charter, Bill C-11, which is a new Cyber Security policy,” reported Drydennow.com, a news website that covers Northwestern Ontario. Drydennow says the next federal election is expected to be held on or before Oct. 16, 2023.

John Clifton Davies was convicted in 2015 of swindling businesses throughout the U.K. that were struggling financially and seeking to restructure their debt. For roughly six years, Davies ran a series of firms that pretended to offer insolvency services, but instead simply siphoned what little remaining money these companies had.

The very first entity mentioned in the technology portfolio advertised on the CodesToYou website is called “MySolve,” and it purports to offer a “multi-feature platform for insolvency practitioners.”

Mr. Davies’ fourth wife, Iryna Davies, is listed as a director of one of the insolvency consulting businesses in the U.K. that was part of John Davies’ 2015 fraud conviction. Prior to his trial for fraud, Davies served 16 months in jail before being cleared of murdering his third wife on their honeymoon in India: Colette Davies, 39, died after falling 80 feet from a viewing point at a steep gorge in the Himachal Pradesh region of India.

Mr. Davies was charged with murder and fraud after he attempted to collect GBP 132,000 in her life insurance payout, but British prosecutors ultimately conceded they did not have enough evidence to convict him.

The scams favored by Davies and his alter egos are smart because he never approaches investors directly; rather, investors are incentivized to put his portfolio in front of tech firms seeking financial backing. And all the best cons begin as an idea or possibility planted in the target’s mind.

It’s also a reliable scam because companies bilked by small-time investment schemes rarely pursue legal action, mainly because the legal fees involved can quickly surpass the losses. On top of that, many victims will likely be too ashamed to admit their duping. Victims who do press their case in court and win then face the daunting challenge of collecting damages from a slew of ephemeral shell corporations.

The latest Bernard victim to speak publicly — a Norwegian company hoping to build a fleet of environmentally friendly shipping vessels — is now embroiled in a lawsuit over a deal gone bad. As part of that scam, Bernard falsely claimed to have secured $100 million from six other wealthy investors, including the founder of Uber and the artist Abel Makkonen Tesfaye, better known as The Weeknd.

If you liked this story, check out my previous reporting on John Bernard/Davies:

Due Diligence That Money Can’t Buy

Who is Tech Investor John Bernard?

Promising Infusions of Cash, Fake Investor John Bernard Walked Away With $30 Million

Investment Scammer John Davies Reinvents Himself?

Fake Investor John Bernard Sinks Norwegian Green Shipping Dreams

German Police Raid DDoS-Friendly Host ‘FlyHosting’

Authorities in Germany this week seized Internet servers that powered FlyHosting, a dark web offering that catered to cybercriminals operating DDoS-for-hire services, KrebsOnSecurity has learned. FlyHosting first advertised on cybercrime forums in November 2022, saying it was a Germany-based hosting firm that was open for business to anyone looking for a reliable place to host malware, botnet controllers, or DDoS-for-hire infrastructure.

A seizure notice left on the FlyHosting domains.

A statement released today by the German Federal Criminal Police Office says they served eight search warrants on March 30, and identified five individuals aged 16-24 suspected of operating “an internet service” since mid-2021. The German authorities did not name the suspects or the Internet service in question.

“Previously unknown perpetrators used the Internet service provided by the suspects in particular for so-called ‘DDoS attacks’, i.e. the simultaneous sending of a large number of data packets via the Internet for the purpose of disrupting other data processing systems,” the statement reads.

News of a raid on FlyHosting first surfaced Thursday in a Telegram chat channel that is frequented by people interested or involved in the DDoS-for-hire industry, where a user by the name Dstatcc broke the news to Fly Hosting customers:

“So Flyhosting made a ‘migration’ with it[s] systems to new rooms of the police ;),” the warning read. “Police says: They support ddos attacks, C&C/C2 and stresser a bit too much. We expect the police will take a deeper look into the files, payment logs and IP’s. If you had a server from them and they could find ‘bad things’ connected with you (payed with private paypal) you may ask a lawyer.”

An ad for FlyHosting posted by the the user “bnt” on the now-defunct cybercrime forum BreachForums. Image: Ke-la.com.

The German authorities said that as a result of the DDoS attacks facilitated by the defendants, the websites of various companies as well as those of the Hesse police have been overloaded in several cases since mid-2021, “so that they could only be operated to a limited extent or no longer at times.”

The statement says police seized mobile phones, laptops, tablets, storage media and handwritten notes from the unnamed defendants, and confiscated servers operated by the suspects in Germany, Finland and the Netherlands.

KrebsOnSecurity has asked the German police for more information about the target of their raids. This post will be updated in the event they respond.

The apparent raids on FlyHosting come amid a broader law enforcement crackdown on DDoS-for-hire services internationally. The U.K.’s National Crime Agency announced last week that it’s been busy setting up phony DDoS-for-hire websites that seek to collect information on users, remind them that launching DDoS attacks is illegal, and generally increase the level of paranoia for people looking to hire such services.

In mid-December 2022, the U.S. Department of Justice (DOJ) announced “Operation Power Off,” which seized four-dozen DDoS-for-hire domains responsible for more than 30 million DDoS attacks, and charged six U.S. men with computer crimes related to their alleged ownership of popular DDoS-for-hire services.

UK Sets Up Fake Booter Sites To Muddy DDoS Market

The United Kingdom’s National Crime Agency (NCA) has been busy setting up phony DDoS-for-hire websites that seek to collect information on users, remind them that launching DDoS attacks is illegal, and generally increase the level of paranoia for people looking to hire such services.

The warning displayed to users on one of the NCA’s fake booter sites. Image: NCA.

The NCA says all of its fake so-called “booter” or “stresser” sites — which have so far been accessed by several thousand people — have been created to look like they offer the tools and services that enable cyber criminals to execute these attacks.

“However, after users register, rather than being given access to cyber crime tools, their data is collated by investigators,” reads an NCA advisory on the program. “Users based in the UK will be contacted by the National Crime Agency or police and warned about engaging in cyber crime. Information relating to those based overseas is being passed to international law enforcement.”

The NCA declined to say how many phony booter sites it had set up, or for how long they have been running. The NCA says hiring or launching attacks designed to knock websites or users offline is punishable in the UK under the Computer Misuse Act 1990.

“Going forward, people who wish to use these services can’t be sure who is actually behind them, so why take the risk?” the NCA announcement continues.

The NCA campaign comes closely on the heels of an international law enforcement takedown involving four-dozen websites that made powerful DDoS attacks a point-and-click operation.

In mid-December 2022, the U.S. Department of Justice (DOJ) announced “Operation Power Off,” which seized four-dozen booter business domains responsible for more than 30 million DDoS attacks, and charged six U.S. men with computer crimes related to their alleged ownership of popular DDoS-for-hire services. In connection with that operation, the NCA also arrested an 18-year-old man suspected of running one of the sites.

According to U.S. federal prosecutors, the use of booter and stresser services to conduct attacks is punishable under both wire fraud laws and the Computer Fraud and Abuse Act (18 U.S.C. § 1030), and may result in arrest and prosecution, the seizure of computers or other electronics, as well as prison sentences and a penalty or fine.

The United Kingdom, which has been battling its fair share of domestic booter bosses, started running online ads in 2020 aimed at young people who search the Web for booter services.

As part of last year’s mass booter site takedown, the FBI and the Netherlands Police joined the NCA in announcing they are running targeted placement ads to steer those searching for booter services toward a website detailing the potential legal risks of hiring an online attack.

Google Suspends Chinese E-Commerce App Pinduoduo Over Malware

Google says it has suspended the app for the Chinese e-commerce giant Pinduoduo after malware was found in versions of the software. The move comes just weeks after Chinese security researchers published an analysis suggesting the popular e-commerce app sought to seize total control over affected devices by exploiting multiple security vulnerabilities in a variety of Android-based smartphones.

In November 2022, researchers at Google’s Project Zero warned about active attacks on Samsung mobile phones which chained together three security vulnerabilities that Samsung patched in March 2021, and which would have allowed an app to add or read any files on the device.

Google said it believes the exploit chain for Samsung devices belonged to a “commercial surveillance vendor,” without elaborating further. The highly technical writeup also did not name the malicious app in question.

On Feb. 28, 2023, researchers at the Chinese security firm DarkNavy published a blog post purporting to show evidence that a major Chinese ecommerce company’s app was using this same three-exploit chain to read user data stored by other apps on the affected device, and to make its app nearly impossible to remove.

The three Samsung exploits that DarkNavy says were used by the malicious app. In November 2022, Google documented these three same vulnerabilities being used together to compromise Samsung devices.

DarkNavy likewise did not name the app they said was responsible for the attacks. In fact, the researchers took care to redact the name of the app from multiple code screenshots published in their writeup. DarkNavy did not respond to requests for clarification.

“At present, a large number of end users have complained on multiple social platforms,” reads a translated version of the DarkNavy blog post. “The app has problems such as inexplicable installation, privacy leakage, and inability to uninstall.”

On March 3, 2023, a denizen of the now-defunct cybercrime community BreachForums posted a thread which noted that a unique component of the malicious app code highlighted by DarkNavy also was found in the ecommerce application whose name was apparently redacted from the DarkNavy analysis: Pinduoduo.

A Mar. 3, 2023 post on BreachForums, comparing the redacted code from the DarkNavy analysis with the same function in the Pinduoduo app available for download at the time.

On March 4, 2023, e-commerce expert Liu Huafang posted on the Chinese social media network Weibo that Pinduoduo’s app was using security vulnerabilities to gain market share by stealing user data from its competitors. That Weibo post has since been deleted.

On March 7, the newly created Github account Davinci1010 published a technical analysis claiming that until recently Pinduoduo’s source code included a “backdoor,” a hacking term used to describe code that allows an adversary to remotely and secretly connect to a compromised system at will.

That analysis includes links to archived versions of Pinduoduo’s app released before March 5 (version 6.50 and lower), which is when Davinci1010 says a new version of the app removed the malicious code.

Pinduoduo has not yet responded to requests for comment. Pinduoduo parent company PDD Holdings told Reuters Google has not shared details about why it suspended the app.

The company told CNN that it strongly rejects “the speculation and accusation that Pinduoduo app is malicious just from a generic and non-conclusive response from Google,” and said there were “several apps that have been suspended from Google Play at the same time.”

Pinduoduo is among China’s most popular e-commerce platforms, boasting approximately 900 million monthly active users.

Most of the news coverage of Google’s move against Pinduoduo emphasizes that the malware was found in versions of the Pinduoduo app available outside of Google’s app store — Google Play.

“Off-Play versions of this app that have been found to contain malware have been enforced on via Google Play Protect,” a Google spokesperson said in a statement to Reuters, adding that the Play version of the app has been suspended for security concerns.

However, Google Play is not available to consumers in China. As a result, the app will still be available via other mobile app stores catering to the Chinese market — including those operated by Huawei, Oppo, Tencent and VIVO.

Google said its ban did not affect the PDD Holdings app Temu, which is an online shopping platform in the United States. According to The Washington Post, four of the Apple App Store’s 10 most-downloaded free apps are owned by Chinese companies, including Temu and the social media network TikTok.

The Pinduoduo suspension comes as lawmakers in Congress this week are gearing up to grill the CEO of TikTok over national security concerns. TikTok, which is owned by Beijing-based ByteDance, said last month that it now has roughly 150 million monthly active users in the United States.

A new cybersecurity strategy released earlier this month by the Biden administration singled out China as the greatest cyber threat to the U.S. and Western interests. The strategy says China now presents the “broadest, most active, and most persistent threat to both government and private sector networks,” and says China is “the only country with both the intent to reshape the international order and, increasingly, the economic, diplomatic, military, and technological power to do so.”

Why You Should Opt Out of Sharing Data With Your Mobile Provider

A new breach involving data from nine million AT&T customers is a fresh reminder that your mobile provider likely collects and shares a great deal of information about where you go and what you do with your mobile device — unless and until you affirmatively opt out of this data collection. Here’s a primer on why you might want to do that, and how.

Image: Shutterstock

Telecommunications giant AT&T disclosed this month that a breach at a marketing vendor exposed certain account information for nine million customers. AT&T said the data exposed did not include sensitive information, such as credit card or Social Security numbers, or account passwords, but was limited to “Customer Proprietary Network Information” (CPNI), such as the number of lines on an account.

Certain questions may be coming to mind right now, like “What the heck is CPNI?” And, ‘If it’s so ‘customer proprietary,’ why is AT&T sharing it with marketers?” Also maybe, “What can I do about it?” Read on for answers to all three questions.

AT&T’s disclosure said the information exposed included customer first name, wireless account number, wireless phone number and email address. In addition, a small percentage of customer records also exposed the rate plan name, past due amounts, monthly payment amounts and minutes used.

CPNI refers to customer-specific “metadata” about the account and account usage, and may include:

-Called phone numbers
-Time of calls
-Length of calls
-Cost and billing of calls
-Service features
-Premium services, such as directory call assistance

According to a succinct CPNI explainer at TechTarget, CPNI is private and protected information that cannot be used for advertising or marketing directly.

“An individual’s CPNI can be shared with other telecommunications providers for network operating reasons,” wrote TechTarget’s Gavin Wright. “So, when the individual first signs up for phone service, this information is automatically shared by the phone provider to partner companies.”

Is your mobile Internet usage covered by CPNI laws? That’s less clear, as the CPNI rules were established before mobile phones and wireless Internet access were common. TechTarget’s CPNI primer explains:

“Under current U.S. law, cellphone use is only protected as CPNI when it is being used as a telephone. During this time, the company is acting as a telecommunications provider requiring CPNI rules. Internet use, websites visited, search history or apps used are not protected CPNI because the company is acting as an information services provider not subject to these laws.”

Hence, the carriers can share and sell this data because they’re not explicitly prohibited from doing so. All three major carriers say they take steps to anonymize the customer data they share, but researchers have shown it is not terribly difficult to de-anonymize supposedly anonymous web-browsing data.

“Your phone, and consequently your mobile provider, know a lot about you,” wrote Jack Morse for Mashable. “The places you go, apps you use, and the websites you visit potentially reveal all kinds of private information — e.g. religious beliefs, health conditions, travel plans, income level, and specific tastes in pornography. This should bother you.”

Happily, all of the U.S. carriers are required to offer customers ways to opt out of having data about how they use their devices shared with marketers. Here’s a look at some of the carrier-specific practices and opt-out options.

AT&T

AT&T’s policy says it shares device or “ad ID”, combined with demographics including age range, gender, and ZIP code information with third parties which explicitly include advertisers, programmers, and networks, social media networks, analytics firms, ad networks and other similar companies that are involved in creating and delivering advertisements.

AT&T said the data exposed on 9 million customers was several years old, and mostly related to device upgrade eligibility. This may sound like the data went to just one of its partners who experienced a breach, but in all likelihood it also went to hundreds of AT&T’s partners.

AT&T’s CPNI opt-out page says it shares CPNI data with several of its affiliates, including WarnerMedia, DirecTV and Cricket Wireless. Until recently, AT&T also shared CPNI data with Xandr, whose privacy policy in turn explains that it shares data with hundreds of other advertising firms. Microsoft bought Xandr from AT&T last year.

T-MOBILE

According to the Electronic Privacy Information Center (EPIC), T-Mobile seems to be the only company out of the big three to extend to all customers the rights conferred by the California Consumer Privacy Act (CCPA).

EPIC says T-Mobile customer data sold to third parties uses another unique identifier called mobile advertising IDs or “MAIDs.” T-Mobile claims that MAIDs don’t directly identify consumers, but under the CCPA MAIDs are considered “personal information” that can be connected to IP addresses, mobile apps installed or used with the device, any video or content viewing information, and device activity and attributes.

T-Mobile customers can opt out by logging into their account and navigating to the profile page, then to “Privacy and Notifications.” From there, toggle off the options for “Use my data for analytics and reporting” and “Use my data to make ads more relevant to me.”

VERIZON

Verizon’s privacy policy says it does not sell information that personally identities customers (e.g., name, telephone number or email address), but it does allow third-party advertising companies to collect information about activity on Verizon websites and in Verizon apps, through MAIDs, pixels, web beacons and social network plugins.

According to Wired.com’s tutorial, Verizon users can opt out by logging into their Verizon account through a web browser or the My Verizon mobile app. From there, select the Account tab, then click Account Settings and Privacy Settings on the web. For the mobile app, click the gear icon in the upper right corner and then Manage Privacy Settings.

On the privacy preferences page, web users can choose “Don’t use” under the Custom Experience section. On the My Verizon app, toggle any green sliders to the left.

EPIC notes that all three major carriers say resetting the consumer’s device ID and/or clearing cookies in the browser will similarly reset any opt-out preferences (i.e., the customer will need to opt out again), and that blocking cookies by default may also block the opt-out cookie from being set.

T-Mobile says its opt out is device-specific and/or browser-specific. “In most cases, your opt-out choice will apply only to the specific device or browser on which it was made. You may need to separately opt out from your other devices and browsers.”

Both AT&T and Verizon offer opt-in programs that gather and share far more information, including device location, the phone numbers you call, and which sites you visit using your mobile and/or home Internet connection. AT&T calls this their Enhanced Relevant Advertising Program; Verizon’s is called Custom Experience Plus.

In 2021, multiple media outlets reported that some Verizon customers were being automatically enrolled in Custom Experience Plus — even after those customers had already opted out of the same program under its previous name — “Verizon Selects.”

If none of the above opt out options work for you, at a minimum you should be able to opt out of CPNI sharing by calling your carrier, or by visiting one of their stores.

THE CASE FOR OPTING OUT

Why should you opt out of sharing CPNI data? For starters, some of the nation’s largest wireless carriers don’t have a great track record in terms of protecting the sensitive information that you give them solely for the purposes of becoming a customer — let alone the information they collect about your use of their services after that point.

In January 2023, T-Mobile disclosed that someone stole data on 37 million customer accounts, including customer name, billing address, email, phone number, date of birth, T-Mobile account number and plan details. In August 2021, T-Mobile acknowledged that hackers made off with the names, dates of birth, Social Security numbers and driver’s license/ID information on more than 40 million current, former or prospective customers who applied for credit with the company.

Last summer, a cybercriminal began selling the names, email addresses, phone numbers, SSNs and dates of birth on 23 million Americans. An exhaustive analysis of the data strongly suggested it all belonged to customers of one AT&T company or another. AT&T stopped short of saying the data wasn’t theirs, but said the records did not appear to have come from its systems and may be tied to a previous data incident at another company.

However frequently the carriers may alert consumers about CPNI breaches, it’s probably nowhere near often enough. Currently, the carriers are required to report a consumer CPNI breach only in cases “when a person, without authorization or exceeding authorization, has intentionally gained access to, used or disclosed CPNI.”

But that definition of breach was crafted eons ago, back when the primary way CPNI was exposed was through “pretexting,” such when the phone company’s employees are tricked into giving away protected customer data.

In January, regulators at the U.S. Federal Communications Commission (FCC) proposed amending the definition of “breach” to include things like inadvertent disclosure — such as when companies expose CPNI data on a poorly-secured server in the cloud. The FCC is accepting public comments on the matter until March 24, 2023.

While it’s true that the leak of CPNI data does not involve sensitive information like Social Security or credit card numbers, one thing AT&T’s breach notice doesn’t mention is that CPNI data — such as balances and payments made — can be abused by fraudsters to make scam emails and text messages more believable when they’re trying to impersonate AT&T and phish AT&T customers.

The other problem with letting companies share or sell your CPNI data is that the wireless carriers can change their privacy policies at any time, and you are assumed to be okay with those changes as long as you keep using their services.

For example, location data from your wireless device is most definitely CPNI, and yet until very recently all of the major carriers sold their customers’ real-time location data to third party data brokers without customer consent.

What was their punishment? In 2020, the FCC proposed fines totaling $208 million against all of the major carriers for selling their customers’ real-time location data. If that sounds like a lot of money, consider that all of the major wireless providers reported tens of billions of dollars in revenue last year (e.g., Verizon’s consumer revenue alone was more than $100 billion last year).

If the United States had federal privacy laws that were at all consumer-friendly and relevant to today’s digital economy, this kind of data collection and sharing would always be opt-in by default. In such a world, the enormously profitable wireless industry would likely be forced to offer clear financial incentives to customers who choose to share this information.

But until that day arrives, understand that the carriers can change their data collection and sharing policies when it suits them. And regardless of whether you actually read any notices about changes to their privacy policies, you will have agreed to those changes as long as you continue using their service.