Tag Archive for: Cyber

T-Mobile: Breach Exposed SSN/DOB of 40M+ People

T-Mobile is warning that a data breach has exposed the names, date of birth, Social Security number and driver’s license/ID information of more than 40 million current, former or prospective customers who applied for credit with the company. The acknowledgment came less than 48 hours after millions of the stolen T-Mobile customer records went up for sale in the cybercrime underground.

In a statement Tuesday evening, T-Mobile said a “highly sophisticated” attack against its network led to the breach of data on millions of customers.

“Our preliminary analysis is that approximately 7.8 million current T-Mobile postpaid customer accounts’ information appears to be contained in the stolen files, as well as just over 40 million records of former or prospective customers who had previously applied for credit with T-Mobile,” the company wrote in a blog post. “Importantly, no phone numbers, account numbers, PINs, passwords, or financial information were compromised in any of these files of customers or prospective customers.”

Nevertheless, T-Mobile is urging all T-Mobile postpaid customers to proactively change their account PINs by going online into their T-Mobile account or calling customer care at 611. “This precaution is despite the fact that we have no knowledge that any postpaid account PINs were compromised,” the advisory reads.

It is not clear how many people total may be impacted by this breach. T-Mobile hasn’t yet responded to requests for clarification regarding how many of the 7.8 million current customers may also have been affected by the credit application breach.

The intrusion first came to light on Twitter when the account @und0xxed started tweeting the details, and someone on a cybercrime forum began selling what they claimed were more than 100 million freshly hacked records from T-Mobile. The hackers claimed one of those databases held the name, date of birth, SSN, drivers license information, plaintext security PIN, address and phone number of 36 million T-Mobile customers in the United States — all going back to the mid-1990s.

T-Mobile said it was also able to confirm approximately 850,000 active T-Mobile prepaid customer names, phone numbers and account PINs were also exposed.

“We have already proactively reset ALL of the PINs on these accounts to help protect these customers, and we will be notifying accordingly right away. No Metro by T-Mobile, former Sprint prepaid, or Boost customers had their names or PINs exposed,” T-Mobile said. “We have also confirmed that there was some additional information from inactive prepaid accounts accessed through prepaid billing files. No customer financial information, credit card information, debit or other payment information or SSN was in this inactive file.”

T-Mobile said it would pay for two years of identity theft protection services for any affected customers, and that it was offering “an extra step to protect your mobile account with our Account Takeover Protection capabilities for postpaid customers, which makes it harder for customer accounts to be fraudulently ported out and stolen.” Why it wouldn’t make that extra protection standard for all accounts all the time is not entirely clear.

This stolen data is being actively sold, but if the past is any teacher much of it will wind up posted online soon. It is a safe bet that scammers will use some of this information to target T-Mobile users with phishing messages, account takeovers and harassment.

T-Mobile customers should expect to see phishers taking advantage of public concern over the breach to impersonate the company — and possibly even messages that include the recipient’s compromised account details to make the communications look more legitimate.

Data stolen and exposed in this breach may also be used for identity theft. Credit monitoring and ID theft protection services can help you recover from having your identity stolen, but most will do nothing to stop the ID theft from happening. If you want the maximum control over who should be able to view your credit or grant new lines of credit in your name, then a security freeze is your best option.

If you’re a current T-Mobile customer, by all means change your account PIN as instructed. But regardless of which mobile provider you patronize, consider removing your phone number from as many online accounts as you can. Many online services require you to provide a phone number upon registering an account, but in many cases that number can be removed from your profile afterwards.

Why do I suggest this? Many online services allow users to reset their passwords just by clicking a link sent via SMS, and this unfortunately widespread practice has turned mobile phone numbers into de facto identity documents. Which means losing control over your phone number thanks to an unauthorized SIM swap or mobile number port-out, divorce, job termination or financial crisis can be devastating.

T-Mobile Investigating Claims of Massive Data Breach

Communications giant T-Mobile said today it is investigating the extent of a breach that hackers claim has exposed sensitive personal data on 100 million T-Mobile USA customers, in many cases including the name, Social Security number, address, date of birth, phone number, security PINs and details that uniquely identify each customer’s mobile device.

On Sunday, Vice.com broke the news that someone was selling data on 100 million people, and that the data came from T-Mobile. In a statement published on its website today, the company confirmed it had suffered an intrusion involving “some T-Mobile data,” but said it was too soon in its investigation to know what was stolen and how many customers might be affected.

A sales thread tied to the allegedly stolen T-Mobile customer data.

“We have determined that unauthorized access to some T-Mobile data occurred, however we have not yet determined that there is any personal customer data involved,” T-Mobile wrote.

“We are confident that the entry point used to gain access has been closed, and we are continuing our deep technical review of the situation across our systems to identify the nature of any data that was illegally accessed,” the statement continued. “This investigation will take some time but we are working with the highest degree of urgency. Until we have completed this assessment we cannot confirm the reported number of records affected or the validity of statements made by others.”

The intrusion came to light on Twitter when the account @und0xxed started tweeting the details. Reached via direct message, Und0xxed said they were not involved in stealing the databases but was instead in charge of finding buyers for the stolen T-Mobile customer data.

Und0xxed said the hackers found an opening in T-Mobile’s wireless data network that allowed access to two of T-Mobile’s customer data centers. From there, the intruders were able to dump a number of customer databases totaling more than 100 gigabytes.

They claim one of those databases holds the name, date of birth, SSN, drivers license information, plaintext security PIN, address and phone number of 36 million T-Mobile customers in the United States — all going back to the mid-1990s.

The hacker(s) claim the purloined data also includes IMSI and IMEI data for 36 million customers. These are unique numbers embedded in customer mobile devices that identify the device and the SIM card that ties that customer’s device to a telephone number.

“If you want to verify that I have access to the data/the data is real, just give me a T-Mobile number and I’ll run a lookup for you and return the IMEI and IMSI of the phone currently attached to the number and any other details,” @und0xxed said. “All T-Mobile USA prepaid and postpaid customers are affected; Sprint and the other telecoms that T-Mobile owns are unaffected.”

Other databases allegedly accessed by the intruders included one for prepaid accounts, which had far fewer details about customers.

“Prepaid customers usually are just phone number and IMEI and IMSI,” Und0xxed said. “Also, the collection of databases includes historical entries, and many phone numbers have 10 or 20 IMEIs attached to them over the years, and the service dates are provided. There’s also a database that includes credit card numbers with six digits of the cards obfuscated.”

T-Mobile declined to comment beyond what the company said in its blog post today.

In 2015, a computer breach at big three credit bureau Experian exposed the Social Security numbers and other data on 15 million people who applied for financing from T-Mobile.

Like other mobile providers, T-Mobile is locked in a constant battle with scammers who target its own employees in SIM swapping attacks and other techniques to wrest control over employee accounts that can provide backdoor access to customer data. In at least one case, retail store employees were complicit in the account takeovers.

WHO HACKED T-MOBILE?

The Twitter profile for the account @Und0xxed includes a shout out to @IntelSecrets, the Twitter account of a fairly elusive hacker who also has gone by the handles IRDev and V0rtex. Asked if @IntelSecrets was involved in the T-Mobile intrusion, @und0xxed confirmed that it was.

The IntelSecrets nicknames correspond to an individual who has claimed responsibility for modifying the source code for the Mirai “Internet of Things” botnet to create a variant known as “Satori,” and supplying it to others who used it for criminal gain and were later caught and prosecuted. Like Kenny “NexusZeta” Schuchmann, who pleaded guilty in 2019 to operating the Satori botnet. Two other young men have been charged in connection with Satori — but not IntelSecrets.

How do we know all this about IntelSecrets/IRDev/V0rtex? That identity has acknowledged as much in a series of bizarre lawsuits filed by a person who claims their real name is John Erin Binns. The same Binns identity operates the website intelsecrets[.]su. 

On that site, Binns claims he fled to Germany and Turkey to evade prosecution in the Satori case, only to be kidnapped in Turkey and subjected to various forms of psychological and physical torture. According to Binns, the U.S. Central Intelligence Agency (CIA) falsely told their counterparts in Turkey that he was a supporter or member of the Islamic State (ISIS), a claim he says led to his alleged capture and torture by the Turks.

Since then, Binns has filed a flood of lawsuits naming various federal agencies — including the FBI, the CIA, and the U.S. Special Operations Command (PDF), demanding that the government turn over information collected about him and seeking restitution for his alleged kidnapping at the hands of the CIA.

Speaking to the researcher Alon Gal (@underthebreach), the hackers responsible for the T-Mobile intrusion said they did it to “retaliate against the US for the kidnapping and torture of John Erin Binns in Germany by the CIA and Turkish intelligence agents in 2019. We did it to harm US infrastructure.”

New Anti Anti-Money Laundering Services for Crooks

A new dark web service is marketing to cybercriminals who are curious to see how their various cryptocurrency holdings and transactions may be linked to known criminal activity. Dubbed “Antinalysis,” the service purports to offer a glimpse into how one’s payment activity might be flagged by law enforcement agencies and private companies that try to link suspicious cryptocurrency transactions to real people.

Sample provided by Antinalysis.

“Worried about dirty funds in your BTC address? Come check out Antinalysis, the new address risk analyzer,” reads the service’s announcement, pointing to a link only accessible via Tor. “This service is dedicated to individuals that have the need to possess complete privacy on the blockchain, offering a perspective from the opponent’s point of view in order for the user to comprehend the possibility of his/her funds getting flagged down under autocratic illegal charges.”

The ad continues:

Some people might ask, why go into all that? Just cash out in XMR and be done with it. The problem is, cashing out in Monero raises eyebrows on exchanges and mail by cash method is sometimes risky as well. If you use BTC->XMR->BTC method, you’ll still get flagged down by our services labelled as high risk exchange (not to mention LE and exchanges). Our service provides you with a view from LE/exchange’s perspective of things (with similar accuracy, but quite different approach) that provides you with basic knowledge of how “clean” your address is.”

Tom Robinson, co-founder of blockchain intelligence firm Elliptic, said Antinalysis is designed to help crypto money launderers test whether their funds will be identified as proceeds of crime by regulated financial exchanges.

“Cryptoassets have become an important tool for cybercriminals,” Robinson wrote. “The likes of ransomware and darknet markets rely on payments being made in Bitcoin and other cryptocurrencies. However, laundering and cashing-out these proceeds is a major challenge.”

Cryptocurrency exchanges make use of blockchain analytics tools, he said, to check customer deposits for links to illicit activity. By tracing a transaction back through the blockchain, these tools can identify whether the funds originated from a wallet associated with ransomware or any other criminal activity.

“The launderer therefore risks being identified as a criminal and being reported to law enforcement whenever they send funds to a business using such a tool,” Robinson said. “Antinalysis seeks to help crypto launderers to avoid this, by giving them a preview of what a blockchain analytics tool will make of their bitcoin wallet and the funds it contains.”

Each lookup at Antinalysis costs roughly USD $3, with a minimum $30 purchase. Other plans go as high as $6,000 for 5,000 requests.

Robinson says the creator of Antinalysis is also one of the developers of Incognito Market, a darknet marketplace specializing in the sale of narcotics.

“Incognito was launched in late 2020, and accepts payments in both Bitcoin and Monero, a cryptoasset offering heightened anonymity,” he wrote. “The launch of Antinalysis likely reflects the difficulties faced by the market and its vendors in cashing out their Bitcoin proceeds.”

Elliptic wasn’t impressed with the quality of the intelligence provided by Antinalysis, saying it performs poorly on detecting links to major darknet markets and other criminal entities. But with countless criminals now making millions from ransomware, there is certainly a vast, untapped market for services that help those folks improve their operational security.

“It is also significant because it makes blockchain analytics available to the public for the first time,” Robinson wrote. “To date, this type of analysis has been used primarily by regulated financial service providers.”

That may not be entirely true. Nick Bax is an independent expert in tracing cryptocurrency transactions, and he said it appears Antinalysis may be little more than a clone of AMLBot, an anti- anti-money laundering intelligence service that first came online in 2019.

AMLBot’s user interface.

“It looks almost identical to the cheap version of AMLBot,” Bax told KrebsOnSecurity. “My guess is they’re just white-labeling that.”

Bax said a lookup at AMLBot on the virtual currency address used in the sample provided by Antinalysis shows a near identical result. Here’s AMLBot’s result for the same crypto analysis performed by Antinalysis in the screenshot at the top of this story:

AMLBot’s response for the same cryptocurrency address provided as an example by Antinalysis.

“If you look at the breakdown the percentages are all almost identical,” Bax said. “I use AMLBot occasionally for good and righteous purposes. And it could also be useful for people who are just selling stuff online to make sure they aren’t receiving tainted funds.”

Update, 1:42 p.m. ET: Corrected the story to note that AMLBot has been around since 2019.

Update, 1:52 p.m. ET: Elliptic updated its blog post to confirm the connection between Antinanlysis and AMLBot, noting that AMLBot itself is a reseller of yet another service: “As first suggested in an article by Brian Krebs, we can now confirm that the results provided by Antinalysis are identical to those provided by AMLBot. It is therefore likely that Antinalysis makes use of the AMLBot API. AMLBot is itself a reseller for Crystal Blockchain, an analytics provider.”

Microsoft Patch Tuesday, August 2021 Edition

Microsoft today released software updates to plug at least 44 security vulnerabilities in its Windows operating systems and related products. The software giant warned that attackers already are pouncing on one of the flaws, which ironically enough involves an easy-to-exploit bug in the software component responsible for patching Windows 10 PCs and Windows Server 2019 machines.

Microsoft said attackers have seized upon CVE-2021-36948, which is a weakness in the Windows Update Medic service. Update Medic is a new service that lets users repair Windows Update components from a damaged state so that the device can continue to receive updates.

Redmond says while CVE-2021-36948 is being actively exploited, it is not aware of exploit code publicly available. The flaw is an “elevation of privilege” vulnerability that affects Windows 10 and Windows Server 2019, meaning it can be leveraged in combination with another vulnerability to let attackers run code of their choice as administrator on a vulnerable system.

“CVE-2021-36948 is a privilege escalation vulnerability – the cornerstone of modern intrusions as they allow attackers the level of access to do things like hide their tracks and create user accounts,” said Kevin Breen of Immersive Labs. “In the case of ransomware attacks, they have also been used to ensure maximum damage.”

According to Microsoft, critical flaws are those that can be exploited remotely by malware or malcontents to take complete control over a vulnerable Windows computer — and with little to no help from users. Top of the heap again this month: Microsoft also took another stab at fixing a broad class of weaknesses in its printing software.

Last month, the company rushed out an emergency update to patch “PrintNightmare” — a critical hole in its Windows Print Spooler software that was being attacked in the wild. Since then, a number of researchers have discovered holes in that patch, allowing them to circumvent its protections.

Today’s Patch Tuesday fixes another critical Print Spooler flaw (CVE-2021-36936), but it’s not clear if this bug is a variant of PrintNightmare or a unique vulnerability all on its own, said Dustin Childs at Trend Micro’s Zero Day Initiative.

“Microsoft does state low privileges are required, so that should put this in the non-wormable category, but you should still prioritize testing and deployment of this Critical-rated bug,” Childs said.

Microsoft said the Print Spooler patch it is pushing today should address all publicly documented security problems with the service.

“Today we are addressing this risk by changing the default Point and Print driver installation and update behavior to require administrator privileges,” Microsoft said in a blog post. “This change may impact Windows print clients in scenarios where non-elevated users were previously able to add or update printers. However, we strongly believe that the security risk justifies the change. This change will take effect with the installation of the security updates released on August 10, 2021 for all versions of Windows, and is documented as CVE-2021-34481.

August brings yet another critical patch (CVE-2021-34535) for the Windows Remote Desktop service, and this time the flaw is in the Remote Desktop client instead of the server.

CVE-2021-26424 — a scary, critical bug in the Windows TCP/IP component — earned a CVSS score of 9.9 (10 is the worst), and is present in Windows 7 through Windows 10, and Windows Server 2008 through 2019 (Windows 7 is no longer being supported with security updates).

Microsoft said it was not aware of anyone exploiting this bug yet, although the company assigned it the label “exploitation more likely,” meaning it may not be difficult for attackers to figure out. CVE-2021-26424 could be exploited by sending a single malicious data packet to a vulnerable system.

For a complete rundown of all patches released today and indexed by severity, 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 are causing problems for Windows users.

On that note, before you update please make sure you have backed up your system and/or important files. It’s not uncommon for a Windows update package to hose one’s system or prevent it from booting properly, and some updates have been known to erase or corrupt files.

So do yourself a favor and backup before installing any patches. Windows 10 even has some built-in tools to help you do that, either on a per-file/folder basis or by making a complete and bootable copy of your hard drive all at once.

And if you wish to ensure Windows has been set to pause updating so you can back up your files and/or system before the operating system decides to reboot and install patches on its own schedule, see this guide.

If you experience glitches or problems installing any of these patches this month, please consider leaving a comment about it below; there’s a decent chance other readers have experienced the same and may chime in here with useful tips.

Phishing Sites Targeting Scammers and Thieves

I was preparing to knock off work for the week on a recent Friday evening when a curious and annoying email came in via the contact form on this site:

“Hello I go by the username Nuclear27 on your site Briansclub[.]com,” wrote “Mitch,” confusing me with the proprietor of perhaps the underground’s largest bazaar for stolen credit and identity data. “I made a deposit to my wallet on the site but nothing has shown up yet and I would like to know why.”

The real BriansClub login page.

Several things stood out in Mitch’s message. For starters, that is not the actual domain for BriansClub. And it’s easy to see why Mitch got snookered: The real BriansClub site is currently not at the top of search results when one queries that shop name at Google.

Also, this greenhorn criminal clearly had bought into BriansClub’s advertising, which uses my name and likeness in a series of ads that run on all the top cybercrime forums. In those ads, a crab with my head on it zigs and zags on the sand. This is all meant to be a big joke: Krebs means “crab” or “cancer” in German, but a “crab” is sometimes used in Russian hacker slang to refer to a “carder,” or a person who regularly engages in street-level credit card fraud. Like Mitch.

In late 2019, BriansClub changed its homepage to include doctored images of my Social Security and passport cards, credit report and mobile phone bill information. That was right after KrebsOnSecurity broke the news that someone had hacked BriansClub and siphoned information on 26 million stolen debit and credit accounts. The hacked BriansClub database had an estimated collective street value of $566 million, and that data was subsequently shared with thousands of financial institutions.

Mitch said he’d just made a deposit of $240 worth of bitcoin at BriansClub[.]com, and was wondering when the funds would be reflected in the balance of his account on the shop.

Playing along, I said I was sorry to hear about his ordeal, and asked Mitch if there were any stolen cards issued by a particular bank or to a specific region that he was seeking.

Mitch didn’t bite, but neither would he be dissuaded that I was at fault for his wayward funds. He shared a picture showing funds he’d sent to the bitcoin address instructed by BriansClub[.]com — 1PLALmM5rrmLTGGVRHHTnB6VnZd3FFwh1Zusing a Bitcoin ATM in Canada.

The real BriansClub uses a dodgy virtual currency exchange service based in St. Petersburg, Russia called PinPays. The company’s website has long featured little more than a brand icon and an instant messenger address to reach the proprietor. The fake BriansClub told Mitch the Bitcoin address he was asked to pay was a PinPays address that would change with each transaction.

The payment message displayed by the carding site phishing domain BriansClub[.]com.

However, upon registering at the phishing site and clicking to fund my account, I was presented with the exact same Bitcoin address that Mitch said he paid. Also, the site wasn’t using PinPays; it was just claiming to do so to further mimic the real BriansClub.

According to the Blockchain, that Bitcoin address Mitch paid has received more than a thousand payments over the past five months totaling more than USD $40,000 worth of Bitcoin. Most are relatively small payments like Mitch’s.

The screenshot Mitch sent of his deposit.

Unwary scammers like Mitch are a dime a dozen, as are phishing sites that spoof criminal services online. Shortly after it came online as a phishing site last year, BriansClub[.]com was hosted at a company in Moscow with just a handful of other domains phishing popular cybercrime stores, including Jstashbazar[.]com, vclub[.]cards, vclubb[.]com and vclub[.]credit.

Whoever’s behind these sites is making a decent income fleecing clueless crooks. A review of the Bitcoin wallet listed as the payment address for BriansClub[.]org, for example, shows a similar haul: 704 transactions totaling $38,000 in Bitcoin over the past 10 months.

“Wow, thanks for ripping me off,” Mitch wrote, after I’d dozed off for the evening without responding to his increasingly strident emails. “Should have spent the last money on my bills I’m trying to pay off. Should have known you were nothing but a thief.”

Deciding the ruse had gone too far, I confessed to Mitch that I wasn’t really the administrator of BriansClub, and that the person he’d reached out to was an independent journalist who writes about cybercrime. I told him not to feel bad, as more than a thousand people had been similarly duped by the carding shop.

But Mitch did not appear to accept my confession.

“If that’s the case then why is your name all over it including in the window that opens up when you go to make a deposit?,” Mitch demanded, referring to the phishing site.

Clearly, nothing I said was going to deter Mitch at this point. He asked in a follow-up email if a link he included in the message was indeed the “legitimate” BriansClub address. My only reply was that he should maybe consider another line of work before he got ripped off yet again, or the Royal Canadian Mounted Police showed up at his doorstep.

Scammers who fall for fake carding sites can expect to have their accounts taken over at the real shop, which usually means someone spends your balance on stolen cards. But mostly, these imposter carding sites are asking new members to fund their accounts by making deposits in virtual currency like Bitcoin.

In 2018, KrebsOnSecurity examined a huge network of phishing sites masquerading as the top carding stores which all traced back to a web development group in Pakistan that’s apparently been stealing from thieves for years.

As I noted in that piece, creating a network of fake carding sites is the perfect cybercrime. After all, nobody who gets phished or scammed is going to report the crime to the authorities. Nor will anyone help the poor sucker who gets snookered by one of these fake carding sites. Caveat Emptor!

The most one can hope for is that the occasional enterprising phisher is brought to justice. While it may be hard to believe that authorities would go after crooks stealing from one another, in 2017 a Connecticut man pleaded guilty to charges of phishing several criminal dark web markets in a scheme that eventually netted over $365,000 and more than 10,000 stolen user credentials.

And what about the provenance of the phishing domain briansclub[.]com? Looking closer at the original WHOIS registration records for briansclub[.]com via DomainTools (an advertiser on this site), we can see it was registered in November 2015 — several months after the real BriansClub came online. It was registered to a “Brian Billionaire,” a.k.a. Brian O’Connor, an apparently accomplished music deejay, rapper and rap music producer in Florida.

Brian Billionaire.

For several years after it came online, BriansClub[.]com and other domains apparently registered to Mr. Billionaire redirected to his main site — newhotmusic.com, which predates the carding shop BriansClub and also has a members-only section of the site called Brian’s Club.

Mr. Billionaire did not respond to multiple requests for comment, but it looks like his only crime is being a somewhat cringeworthy DJ. DomainTools’ record for briansclub[.]com says the domain was abandoned or dormant for a period in 2019, only to be scooped up again by someone in May 2020 when it became a phishing site spoofing the real BriansClub.

Ransomware Gangs and the Name Game Distraction

It’s nice when ransomware gangs have their bitcoin stolen, malware servers shut down, or are otherwise forced to disband. We hang on to these occasional victories because history tells us that most ransomware moneymaking collectives don’t go away so much as reinvent themselves under a new name, with new rules, targets and weaponry. Indeed, some of the most destructive and costly ransomware groups are now in their third incarnation.

A rough timeline of major ransomware operations and their reputed links over time.

Reinvention is a basic survival skill in the cybercrime business. Among the oldest tricks in the book is to fake one’s demise or retirement and invent a new identity. A key goal of such subterfuge is to throw investigators off the scent or to temporarily direct their attention elsewhere.

Cybercriminal syndicates also perform similar disappearing acts whenever it suits them. These organizational reboots are an opportunity for ransomware program leaders to set new ground rules for their members — such as which types of victims aren’t allowed (e.g., hospitals, governments, critical infrastructure), or how much of a ransom payment an affiliate should expect for bringing the group access to a new victim network.

I put together the above graphic to illustrate some of the more notable ransom gang reinventions over the past five years. What it doesn’t show is what we already know about the cybercriminals behind many of these seemingly disparate ransomware groups, some of whom were pioneers in the ransomware space almost a decade ago. We’ll explore that more in the latter half of this story.

One of the more intriguing and recent revamps involves DarkSide, the group that extracted a $5 million ransom from Colonial Pipeline earlier this year, only to watch much of it get clawed back in an operation by the U.S. Department of Justice.

After acknowledging someone had also seized their Internet servers, DarkSide announced it was folding. But a little more than a month later, a new ransomware affiliate program called BlackMatter emerged, and experts quickly determined BlackMatter was using the same unique encryption methods that DarkSide had used in their attacks.

DarkSide’s demise roughly coincided with that of REvil, a long-running ransomware group that claims to have extorted more than $100 million from victims. REvil’s last big victim was Kaseya, a Miami-based company whose products help system administrators manage large networks remotely. That attack let REvil deploy ransomware to as many as 1,500 organizations that used Kaseya.

REvil demanded a whopping $70 million to release a universal decryptor for all victims of the Kaseya attack. Just days later, President Biden reportedly told Russian President Vladimir Putin that he expects Russia to act when the United States shares information on specific Russians involved in ransomware activity.

A REvil ransom note.

Whether that conversation prompted actions is unclear. But REvil’s victim shaming blog would disappear from the dark web just four days later.

Mark Arena, CEO of cyber threat intelligence firm Intel 471, said it remains unclear whether BlackMatter is the REvil crew operating under a new banner, or if it is simply the reincarnation of DarkSide.

But one thing is clear, Arena said: “Likely we will see them again unless they’ve been arrested.”

Likely, indeed. REvil is widely considered a reboot of GandCrab, a prolific ransomware gang that boasted of extorting more than $2 billion over 12 months before abruptly closing up shop in June 2019. “We are living proof that you can do evil and get off scot-free,” Gandcrab bragged.

And wouldn’t you know it: Researchers have found GandCrab shared key behaviors with Cerber, an early ransomware-as-a-service operation that stopped claiming new victims at roughly the same time that GandCrab came on the scene.

GOOD GRIEF

The past few months have been a busy time for ransomware groups looking to rebrand. BleepingComputer recently reported that the new “Grief” ransomware startup was just the latest paintjob of DoppelPaymer, a ransomware strain that shared most of its code with an earlier iteration from 2016 called BitPaymer.

All three of these ransom operations stem from a prolific cybercrime group known variously as TA505, “Indrik Spider” and (perhaps most memorably) Evil Corp. According to security firm CrowdStrike, Indrik Spider was formed in 2014 by former affiliates of the GameOver Zeus criminal network who internally referred to themselves as “The Business Club.”

The Business Club was a notorious Eastern European organized cybercrime gang accused of stealing more than $100 million from banks and businesses worldwide. In 2015, the FBI offered a standing $3 million bounty for information leading to the capture of the Business Club’s leader — Evgeniy Mikhailovich Bogachev. By the time the FBI put a price on his head, Bogachev’s Zeus trojan and later variants had been infecting computers for nearly a decade.

The alleged ZeuS Trojan author, Evgeniy Mikhaylovich Bogachev. Source: FBI

Bogachev was way ahead of his colleagues in pursuing ransomware. His Gameover Zeus Botnet was a peer-to-peer crime machine that infected between 500,000 and a million Microsoft Windows computers. Throughout 2013 and 2014, PCs infected with Gameover were seeded with Cryptolocker, an early, much-copied ransomware strain allegedly authored by Bogachev himself.

CrowdStrike notes that shortly after the group’s inception, Indrik Spider developed their own custom malware known as Dridex, which has emerged as a major vector for deploying malware that lays the groundwork for ransomware attacks.

“Early versions of Dridex were primitive, but over the years the malware became increasingly professional and sophisticated,” CrowdStrike researchers wrote. “In fact, Dridex operations were significant throughout 2015 and 2016, making it one of the most prevalent eCrime malware families.”

That CrowdStrike report was from July 2019. In April 2021, security experts at Check Point Software found Dridex was still the most prevalent malware (for the second month running). Mainly distributed via well-crafted phishing emails — such as a recent campaign that spoofed QuickBooks — Dridex often serves as the attacker’s initial foothold in company-wide ransomware attacks, CheckPoint said.

REBRANDING TO AVOID SANCTIONS

Another ransomware family tied to Evil Corp. and the Dridex gang is WastedLocker, which is the latest name of a ransomware strain that has rebranded several times since 2019. That was when the Justice Department put a $5 million bounty on the head of Evil Corp., and the Treasury Department’s Office of Foreign Asset Control (OFAC) said it was prepared to impose hefty fines on anyone who paid a ransom to the cybercrime group.

Alleged Evil Corp leader Maksim “Aqua” Yakubets. Image: FBI

In early June 2021, researchers discovered the Dridex gang was once again trying to morph in an effort to evade U.S. sanctions. The drama began when the Babuk ransomware group announced in May that they were starting a new platform for data leak extortion, which was intended to appeal to ransomware groups that didn’t already have a blog where they can publicly shame victims into paying by gradually releasing stolen data.

On June 1, Babuk changed the name of its leaks site to payload[dot]bin, and began leaking victim data. Since then, multiple security experts have spotted what they believe is another version of WastedLocker dressed up as payload.bin-branded ransomware.

“Looks like EvilCorp is trying to pass off as Babuk this time,” wrote Fabian Wosar, chief technology officer at security firm Emsisoft. “As Babuk releases their PayloadBin leak portal, EvilCorp rebrands WastedLocker once again as PayloadBin in an attempt to trick victims into violating OFAC regulations.”

Experts are quick to point out that many cybercriminals involved in ransomware activity are affiliates of more than one distinct ransomware-as-a-service operation. In addition, it is common for a large number of affiliates to migrate to competing ransomware groups when their existing sponsor suddenly gets shut down.

All of the above would seem to suggest that the success of any strategy for countering the ransomware epidemic hinges heavily on the ability to disrupt or apprehend a relatively small number of cybercriminals who appear to wear many disguises.

Perhaps that’s why the Biden Administration said last month it was offering a $10 million reward for information that leads to the arrest of the gangs behind the extortion schemes, and for new approaches that make it easier to trace and block cryptocurrency payments.

The Life Cycle of a Breached Database

Every time there is another data breach, we are asked to change our password at the breached entity. But the reality is that in most cases by the time the victim organization discloses an incident publicly the information has already been harvested many times over by profit-seeking cybercriminals. Here’s a closer look at what typically transpires in the weeks or months before an organization notifies its users about a breached database.

Our continued reliance on passwords for authentication has contributed to one toxic data spill or hack after another. One might even say passwords are the fossil fuels powering most IT modernization: They’re ubiquitous because they are cheap and easy to use, but that means they also come with significant trade-offs — such as polluting the Internet with weaponized data when they’re leaked or stolen en masse.

When a website’s user database gets compromised, that information invariably turns up on hacker forums. There, denizens with computer rigs that are built primarily for mining virtual currencies can set to work using those systems to crack passwords.

How successful this password cracking is depends a great deal on the length of one’s password and the type of password hashing algorithm the victim website uses to obfuscate user passwords. But a decent crypto-mining rig can quickly crack a majority of password hashes generated with MD5 (one of the weaker and more commonly-used password hashing algorithms).

“You hand that over to a person who used to mine Ethereum or Bitcoin, and if they have a large enough dictionary [of pre-computed hashes] then you can essentially break 60-70 percent of the hashed passwords in a day or two,” said Fabian Wosar, chief technology officer at security firm Emsisoft.

From there, the list of email addresses and corresponding cracked passwords will be run through various automated tools that can check how many email address and password pairs in a given leaked data set also work at other popular websites (and heaven help those who’ve re-used their email password elsewhere).

This sifting of databases for low-hanging fruit and password re-use most often yields less than a one percent success rate — and usually far less than one percent.

But even a hit rate below one percent can be a profitable haul for fraudsters, particularly when they’re password testing databases with millions of users. From there, the credentials are eventually used for fraud and resold in bulk to legally murky online services that index and resell access to breached data.

Much like WeLeakInfo and others operated before being shut down by law enforcement agencies, these services sell access to anyone who wants to search through billions of stolen credentials by email address, username, password, Internet address, and a variety of other typical database fields.

TARGETED PHISHING

So hopefully by this point it should be clear why re-using passwords is generally a bad idea. But the more insidious threat with hacked databases comes not from password re-use but from targeted phishing activity in the early days of a breach, when relatively few ne’er-do-wells have got their hands on a hot new hacked database.

Earlier this month, customers of the soccer jersey retailer classicfootballshirts.co.uk started receiving emails with a “cash back” offer. The messages addressed customers by name and referenced past order numbers and payment amounts tied to each account. The emails encouraged recipients to click a link to accept the cash back offer, and the link went to a look-alike domain that requested bank information.

The targeted phishing message that went out to classicfootballshirts.co.uk customers this month.

“It soon became clear that customer data relating to historic orders had been compromised to conduct this attack,” Classicfootballshirts said in a statement about the incident.

Allison Nixon, chief research officer with New York City-based cyber intelligence firm Unit221B, recalled what happened in the weeks leading up to Dec. 22, 2020, when cryptocurrency wallet company Ledger acknowledged that someone had released the names, mailing addresses and phone numbers for 272,000 customers.

Nixon said she and her colleagues noticed in the preceding months a huge uptick in SIM-swapping attacks, a scheme in which fraudsters trick or bribe employees at wireless phone companies into redirecting the target’s text messages and phone calls to a device they control. From there, the attackers can reset the password for any online account that allows password resets via SMS.

“A week or two prior to that we were seeing a whole lot of SIM swapping activity,” Nixon said. “We knew the information was coming from some database but we couldn’t figure out what service they all had in common. After the Ledger database got leaked publicly, we started looking at the [SIM swapping] victims and found 100 percent of them were present in the Ledger database.”

In a statement about the breach, Ledger said the data was likely stolen in June 2020, meaning hackers had roughly six months to launch targeted attacks using extremely detailed information about customers.

“If you were to look [on cybercrime forums] at the past history of people posting about that Ledger database, you’d see people were selling it privately for months prior to that,” Nixon said. “It seems like this database was slowly percolating out wider and wider, until someone decided to remove a lot of its value by posting the whole thing publicly.”

Here are some tips to help avoid falling prey to incessant data breaches and increasingly sophisticated phishing schemes:

Avoid clicking on links and attachments in email, even in messages that appear to be sent from someone you have heard from previously. And as the phishing examples above demonstrate, many of today’s phishing scams use elements from hacked databases to make their lures more convincing.

Urgency should be a giant red flag. Most phishing scams invoke a temporal element that warns of negative consequences should you fail to respond or act quickly. Take a deep breath. If you’re unsure whether the message is legitimate, visit the site or service in question manually (ideally, using a browser bookmark so as to avoid potential typosquatting sites).

Don’t re-use passwords. If you’re the kind of person who likes to use the same password across multiple sites, then you definitely need to be using a password manager. That’s because password managers handle the tedious task of creating and remembering unique, complex passwords on your behalf; all you need to do is remember a single, strong master password or passphrase. In essence, you effectively get to use the same password across all Web sites. Some of the more popular password managers include DashlaneKeepassLastPass and Roboform.

–Phone-based phishing uses hacked databases, too: A great many scams are perpetrated over the phone, leveraging personal and financial information gleaned from past data breaches to make them sound more believable. If you think you’d never fall for someone trying to scam you over the phone, check out this story about how a tech-savvy professional got taken for thousands of dollars by a fraudster masquerading as his credit union. Remember, When in Doubt: Hang Up, Look Up, & Call Back.

PlugwalkJoe Does the Perp Walk

Joseph “PlugwalkJoe” O’Connor, in a photo from a paid press release on Sept. 02, 2020, pitching him as a trustworthy cryptocurrency expert and advisor.

One day after last summer’s mass-hack of Twitter, KrebsOnSecurity wrote that 22-year-old British citizen Joseph “PlugwalkJoe” O’Connor appeared to have been involved in the incident. When the U.S. Justice Department last week announced O’Connor’s arrest and indictment, his alleged role in the Twitter compromise was well covered in the media.

But most of the coverage seems to have overlooked the far more sinister criminal charges in the indictment, which involve an underground scene wherein young men turn to extortion, sextortion, SIM swapping, death threats and physical attacks — all in a frenzied effort to seize control over social media accounts.

Skim the government’s indictment and you might overlook a footnote on Page 4 that says O’Connor is part of a group that had exactly zero reservations about using their playbook of harassment tactics against law enforcement agents who were already investigating their alleged crimes.

O’Connor has potentially been linked to additional prior swatting incidents and possibly (although not confirmed and currently still under investigation) the swatting of a U.S. law enforcement officer,” the footnote reads.

Swatting involves making a false report to authorities in a target’s name with the intention of sending a heavily armed police force to that person’s address. It’s a potentially deadly hoax: Earlier this month, a Tennessee man was sentenced to 60 months in prison for setting in motion a swatting attack that led to the death of a 60-year-old grandfather.

As for the actual criminal charges, O’Connor faces ten counts, including conspiracy, computer intrusion, extortive communications, stalking and threatening communications.

FEMALE TARGETS

All of those come into play in the case of the Snapchat account of actor Bella Thorne, who was allegedly targeted by PlugwalkJoe and associates in June 2019.

Investigators say O’Connor was involved in a “SIM swap” against Thorne’s mobile phone number. Unauthorized SIM swapping is a scheme in which fraudsters trick or bribe employees at wireless phone companies into redirecting the target’s text messages and phone calls to a device they control. From there, the attackers can reset the password for any online account that allows password resets via SMS.

In this case, the SIM swap was done to wrest control over Thorne’s Snapchat account. Once inside, the attackers found nude photos of Thorne, which they then threatened to release unless she agreed to post on social media thanking the hackers using their online handles.

The intruders posted on Thorne’s Snapchat, “Will drop nudes if 5000 of you follow @PlugwalkJoe.” Thorne told the feds her phone lost service shortly before her account was hijacked. Investigators later found the same Internet address used to access Thorne’s Snapchat account also was used minutes later to access “@Joe” on Instagram, which O’Connor has claimed publicly.

On June 15, 2019, Thorne posted on Twitter that she’d been “threatened with my own nudes,” and posted screenshots of the text message with the individual who had extorted him/her. Thorne said she was releasing the photographs so that the individual would not be able to “take yet another thing from me.”

The indictment alleges O’Connor also swatted and cyberstalked a 16-year-old girl, sending her nude photos and threatening to rape and/or murder her and her family.

Social media personality Addison Rae had 55 million followers when her TikTok account got hacked last August. I noted on Twitter at the time that PlugWalkJoe had left his calling card yet again. The indictment alleges O’Connor also was involved in a SIM-swap against Rae’s mobile number.


BAD REACTION

Prosecutors believe that roughly a week after the Twitter hack O’Connor called in bomb threats and swatting attacks targeting a high school and an airport in California. They’re confident it was O’Connor making the swatting and bomb threat calls because his voice is on record in a call he made to federal investigators, as well as to an inmate arrested for SIM swapping.

Curiously left out of the media coverage of O’Connor’s alleged crimes is that PlugwalkJoe appears to have admitted in a phone call with the FBI to being part of a criminal conspiracy. In the days following the Twitter mass-hack, O’Connor was quoted in The New York Times denying any involvement in the Twitter bitcoin scam. “I don’t care,” O’Connor told The Times. “They can come arrest me. I would laugh at them. I haven’t done anything.”

Speaking with KrebsOnSecurity via Instagram instant message just days after the Twitter hack, O’Connor demanded that his name be kept out of future blog posts here. After he was told that couldn’t be promised, he mentioned that some people in his circle of friends had been known to hire others to deliver physical beatings on people they didn’t like. In nearly the same breath, O’Connor said he was open to talking to federal investigators and telling his side of the story.

According to the indictment, a week after the Twitter hack a man identifying himself as O’Connor called federal investigators in Northern California. Specifically, the call went to the REACT Task Force. REACT is a team of law enforcement officers and prosecutors based in Santa Clara, Calif. that is focused on catching criminal SIM swappers, and by this point REACT already had plenty of audio from phone calls traced back to O’Connor in which he allegedly participated in a SIM swapping or swatting attack.

“REACT began receiving tips in 2018 regarding illegal activity of an individual using the online moniker ‘PlugwalkJoe,’ purportedly identified as O’Connor from the United Kingdom,” the indictment states.

Prosecutors redacted the name of the law enforcement officer who allegedly was swatted by PlugwalkJoe, referring to him only as “C.T.,” a criminal investigator for the Santa Clara District Attorney and a REACT Task Force member.

FBI agents called O’Connor back at the number he left. O’Connor told the FBI that on the afternoon of July 15, 2020 he’d been in contact with other associates who were in communications with the alleged mastermind of the Twitter bitcoin scam. Those intermediaries worked directly with Graham Clark, then 17, who pleaded guilty to fraud charges last summer in connection with the Twitter hack and agreed to serve three years in prison followed by three years of probation.

The indictment says O’Connor told the feds he only wanted his friends to relay his desire for Clark to secure several different short Twitter usernames that belonged to other people, accounts that were to be later sold for a profit. The other associates who allegedly helped PlugwalkJoe interact with Clark also have since been charged in connection with the Twitter hack.

A copy of the indictment is here (PDF).

Serial Swatter Who Caused Death Gets Five Years in Prison

A 18-year-old Tennessee man who helped set in motion a fraudulent distress call to police that led to the death of a 60-year-old grandfather in 2020 was sentenced to 60 months in prison today.

60-year-old Mark Herring died of a heart attack after police surrounded his home in response to a swatting attack.

Shane Sonderman, of Lauderdale County, Tenn. admitted to conspiring with a group of criminals that’s been “swatting” and harassing people for months in a bid to coerce targets into giving up their valuable Twitter and Instagram usernames.

At Sonderman’s sentencing hearing today, prosecutors told the court the defendant and his co-conspirators would text and call targets and their families, posting their personal information online and sending them pizzas and other deliveries of food as a harassment technique.

Other victims of the group told prosecutors their tormentors further harassed them by making false reports of child abuse to social services local to the target’s area, and false reports in the target’s name to local suicide prevention hotlines.

Eventually, when subjects of their harassment refused to sell or give up their Twitter and Instagram usernames, Sonderman and others would swat their targets — or make a false report to authorities in the target’s name with the intention of sending a heavily armed police response to that person’s address.

For weeks throughout March and April 2020, 60-year-old Mark Herring of Bethpage, Tenn. was inundated with text messages asking him to give up his @Tennessee Twitter handle. When he ignored the requests, Sonderman and his buddies began having food delivered to Herring’s home via cash on delivery.

At one point, Sonderman posted Herring’s home address in a Discord chat room used by the group, and a minor in the United Kingdom quickly followed up by directing a swatting attack on Herring’s home.

Ann Billings was dating Mr. Herring and was present when the police surrounded his home. She recalled for the Tennessee court today how her friend died shortly thereafter of a heart attack.

Billings said she first learned of the swatting when a neighbor called and asked why the street was lined with police cars. When Mr. Herring stepped out on the back porch to investigate, police told him to put his hands up and to come to the street.

Unable to disengage a lock on his back fence, Herring was instructed to somehow climb over the fence with his hands up.

“He was starting to get more upset,” Billings recalled. “He said, ‘I’m a 60-year-old fat man and I can’t do that.’”

Billings said Mr. Herring then offered to crawl under a gap in the fence, but when he did so and stood up, he collapsed of a heart attack. Herring died at a nearby hospital soon after.

Mary Frances Herring, who was married to Mr. Herring for 28 years, said her late husband was something of a computer whiz in his early years who secured the @Tennessee Twitter handle shortly after Twitter came online. Internet archivist Jason Scott says Herring was the creator of the successful software products Sparkware and QWIKMail; Scott has 2 hours worth of interviews with Herring from 20 years ago here.

Perhaps the most poignant testimony today came when Ms. Herring said her husband — who was killed by people who wanted to steal his account — had a habit of registering new Instagram usernames as presents for friends and family members who’d just had children.

“If someone was having a baby, he would ask them, ‘What are your naming the baby?’,” Ms. Herring said. “And he would get them that Instagram name and give it to them as a gift.”

Valerie Dozono also was an early adopter of Instagram, securing the two-letter username “VD” for her initials. When Dozono ignored multiple unsolicited offers to buy the account, she and many family and friends started getting unrequested pizza deliveries at all hours.

When Dozono continued to ignore her tormentors, Sonderman and others targeted her with a “SIM-swapping attack,” a scheme in which fraudsters trick or bribe employees at wireless phone companies into redirecting the target’s text messages and phone calls to a device they control. From there, the attackers can reset the password for any online account that allows password resets via SMS.

But it wasn’t the subsequent bomb threat that Sonderman and friends called in to her home that bothered Dozono most. It was the home invasion that was ordered at her address using strangers on social media.

Dozono said Sonderman created an account on Grindr — the location-based social networking and dating app for gay, bi, trans and queer people — and set up a rendezvous at her address with an unsuspecting Grindr user who was instructed to waltz into her home as if he was invited.

“This gentleman was sent to my home thinking someone was there, and he was given instructions to walk into my home,” Dozono said.

The court heard from multiple other victims targeted by Sonderman and friends over a two-year period. Including Shane Glass, who started getting harassed in 2019 over his @Shane Instagram handle. Glass told the court that endless pizza deliveries, as well as SIM swapping and swatting attacks left him paranoid for months that his assailant could be someone stalking him nearby.

Judge Mark Norris said Sonderman’s agreement to plead to one count of extortion by threat of serious injury or damage carries with it a recommended sentence of 27 to 33 months in prison. However, the judge said other actions by the defendant warranted up to 60 months (5 years) in prison.

Sonderman might have been eligible to knock a few months off his sentence had he cooperated with investigators and refrained from committing further crimes while out on bond.

But prosecutors said that shortly after his release, Sonderman went right back to doing what he was doing when he got caught. Investigators who subpoenaed his online communications found he’d logged into the Instagram account “FreeTheSoldiers,” which was known to have been used by the group to harass people for their social media handles.

Sonderman was promptly re-arrested for violating the terms of his release, and prosecutors played for the court today a recording of a phone call Sonderman made from jail in which he brags to a female acquaintance that he wiped his mobile phone two days before investigators served another search warrant on his home.

Sonderman himself read a lengthy statement in which he apologized for his actions, blaming his “addiction” on several psychiatric conditions — including bipolar disorder. While his recitation was initially monotone and practically devoid of emotion, Sonderman eventually broke down in tears that made the rest of his statement difficult to hear over the phone-based conference system the court made available to reporters.

The bipolar diagnoses was confirmed by his mother, who sobbed as she simultaneously begged the court for mercy while saying her son didn’t deserve any.

Judge Norris said he was giving Sonderman the maximum sentenced allowed by law under the statute — 60 months in prison followed by three years of supervised release, but implied that his sentence would be far harsher if the law permitted.

“Although it may seem inadequate, the law is the law,” Norris said. “The harm it caused, the death and destruction….it’s almost unspeakable. This is not like cases we frequently have that involve guns and carjacking and drugs. This is a whole different level of insidious criminal behavior here.”

Sonderman’s sentence pales in comparison to the 20-year prison time handed down in 2019 to serial swatter Tyler Barriss, a California man who admitted making a phony emergency call to police in late 2017 that led to the shooting death of an innocent Kansas resident.

Spam Kingpin Peter Levashov Gets Time Served

Peter Levashov, appearing via Zoom at his sentencing hearing today.

A federal judge in Connecticut today handed down a sentence of time served to spam kingpin Peter “Severa” Levashov, a prolific purveyor of malicious and junk email, and the creator of malware strains that infected millions of Microsoft computers globally. Levashov has been in federal custody since his extradition to the United States and guilty plea in 2018, and was facing up to 12 more years in prison. Instead, he will go free under three years of supervised release and a possible fine.

A native of St. Petersburg, Russia, the 40-year-old Levashov operated under the hacker handle “Severa.” Over the course of his 15-year cybercriminal career, Severa would emerge as a pivotal figure in the cybercrime underground, serving as the primary moderator of a spam community that spanned multiple top Russian cybercrime forums.

Severa created and then leased out to others some of the nastiest cybercrime engines in history — including the Storm worm, and the Waledac and Kelihos spam botnets. His central role in the spam forums gave Severa a prime spot to advertise the services tied to his various botnets, while allowing him to keep tabs on the activities of other spammers.

Severa rented out segments of his Waledac botnet to anyone seeking a vehicle for sending spam. For $200, vetted users could hire his botnet to blast one million emails containing malware or ads for male enhancement drugs. Junk email campaigns touting employment or “money mule” scams cost $300 per million, and phishing emails could be blasted out through Severa’s botnet for the bargain price of $500 per million.

Severa was a moderator on the Russian spam community Spamdot[.]biz. In this paid ad from 2004, Severa lists prices to rent his spam botnet.

Early in his career, Severa worked very closely with two major purveyors of spam. One was Alan Ralsky, an American spammer who was convicted in 2009 of paying Severa and other spammers to promote pump-and-dump stock scams.

The other was a major spammer who went by the nickname “Cosma,” the cybercriminal thought to be responsible for managing the Rustock botnet (so named because it was a Russian botnet frequently used to send pump-and-dump stock spam). Microsoft, which has battled to scrub botnets like Rustock off of millions of PCs, later offered a still-unclaimed $250,000 reward for information leading to the arrest and conviction of the Rustock author.

Severa ran several affiliate programs that paid cybercriminals to trick people into installing fake antivirus software. In 2011, KrebsOnSecurity dissected “SevAntivir” — Severa’s eponymous fake antivirus affiliate program  — showing it was used to deploy new copies of the Kelihos spam botnet.

A screenshot of the “SevAntivir” fake antivirus or “scareware” affiliate program run by Severa.

In 2010, Microsoft — in tandem with a number of security researchers — launched a combined technical and legal sneak attack on the Waledac botnet, successfully dismantling it. The company would later do the same to the Kelihos botnet, a global spam machine which shared a great deal of code with Waledac and infected more than 110,000 Microsoft Windows PCs.

Levashov was arrested in 2017 while in Barcelona, Spain with his family. According to a lengthy April 2017 story in Wired.com, he got caught because he violated a basic security no-no: He used the same log-in credentials to both run his criminal enterprise and log into sites like iTunes.

In fighting his extradition to the United States, Levashov famously told the media, “If I go to the U.S., I will die in a year.” But a few months after his extradition, Levashov would plead guilty to four felony counts, including intentional damage to protected computers, conspiracy, wire fraud and aggravated identity theft.

At his sentencing hearing today, Levashov thanked his wife, attorney and the large number of people who wrote the court in support of his character, but otherwise declined to make a statement. His attorney read a lengthy statement explaining that Levashov got into spamming as a way to provide for his family, and that over a period of many years that business saw him supporting countless cybercrime operations.

The plea agreement Levashov approved in 2018 gave Judge Robert Chatigny broad latitude to impose a harsh prison sentence. The government argued that under U.S. federal sentencing guidelines, Levashov’s crimes deserved an “offense level” of 32, which for a first-time offender means a sentence of anywhere from 121 to 151 months (10 to 12 years).

But Judge Chatigny said he had concerns that “the total offense level does overstate the seriousness of Mr. Levashov’s crimes and his criminal culpability,” and said he believed Levashov was unlikely to offend again.

“33 months is a long time and I’m sure it was especially difficult for you considering that you were away from your wife and child and home,” Chatigny told the defendant. “I believe you have a lot to offer and hope that you will do your best to be a positive and contributing member of society.”

Mark Rasch, a former federal prosecutor with the U.S. Justice Department, said the sentencing guidelines are no longer mandatory, but they do reflect the position of Congress, the U.S. Sentencing Commission, and the Administrative Office of the U.S. Courts about what seriousness of the offenses.

“One of the problems you have here is it’s hard enough to catch and prosecute and convict cybercriminals, but at the end of the day the courts often don’t take these offenses seriously,” Rasch said. “One the one hand, sentences like these do tend to diminish the deterrent effect, but also I doubt there are any hackers in St. Petersburg right now who are watching this case and going, ‘Okay, great now I can keep doing what I’m doing.’”

Judge Chatigny deferred ruling on what — if any — financial damages Levashov may have to pay as a result of the plea.

The government acknowledged that it was difficult to come to an accurate accounting of how much Levashov’s various botnets cost companies and consumers. But the plea agreement states a figure of approximately $7 million — which prosecutors say represents a mix of actual damages and ill-gotten gains.

However, the judge delayed ruling on whether to impose a fine because prosecutors had yet to supply a document to back up the defendant’s alleged profit/loss figures. The judge also ordered Levashov to submit to three years of supervised release, which includes constant monitoring of his online communications.