Scotland Yard and Botnets

Scotland Yard and the case of the rent-a-zombies

URL: http://zdnet.com.com/2100-1105-5260154.html

Vast networks of home computers are being rented out without their owners' knowledge to spammers, fraudsters and digital saboteurs, security experts said on Wednesday.

The terminals have been infected by a computer virus, turning them into "zombies"--slaves to the commands of a malicious and unseen controller. Connect them all up, and the result is a powerful network of zombie PCs that security experts call a "botnet."

The programming crooks--often teenage bedroom hackers--are hiring out these networks to anyone who wants to commit Internet mischief.

"Small groups of young people creating a resource out of a 10,000- to 30,000-strong computer network are renting them out to anybody who has the money," a source in Scotland Yard's computer crime unit told Reuters.

There may be millions of such PCs around the world doing the bidding of crime gangs, experts say, and they can be rented for as little as $100 per hour.

By marshaling the muscle of a few thousand computers, a spammer can send a burst of e-mail messages to sell all manner of products in the name of unsuspecting computer users.

Fraudsters known as "phishers" use the networks both to send deceiving messages and host authentic-looking bank Web sites designed to steal financial details, authorities said.

A more sinister use of botnets is sabotage, police say. A fear is growing that a botnet could be used to take down a major data network or prominent Web sites.

"You're talking about serious firepower," the source said.

'Hitmen' PCs Botnets have grown in number and ferocity since last summer, when a volley of digital contagions first hit the Internet, seeking to put unsuspecting home PCs under the command of a single programmer.

The hackers' task has been made easier by the growth in the number of homes connected to broadband--an essential prerequisite for a zombie.

A few months after these viruses first appeared, security experts and police noticed online discussion areas where blocs of virus-infected computers were on offer for those in the market for an army of "hitmen" terminals.

The commandeered machines were first rented out to spammers.

"The preferred method of spamming is now via botnets, and there's a lot of money to be made in hiring them out," said Mark Sunner, chief technology officer at security company MessageLabs.

Lately, botnets have been aimed at crippling Web sites. The ammunition in this case can be bought for a few thousand dollars, experts and investigators say.

"It's denial-of-service for hire," Steve Linford, founder of antispam organization Spamhaus Project, said in reference to a type of digital attack capable of crippling a company's network.

"If you want to take out a big site, you can rent a Russian botnet. When it is aimed at your computer there's nothing you can do," Linford said.

Police in Western Europe have had some luck dismantling a few networks and have made some arrests. But the racket runs deep, investigators say, extending from the United States to Western Europe and perhaps to Eastern European crime syndicates.

The list of botnet victims grows weekly. It includes a host of gambling Web sites and WorldPay, the online payment processing service owned by the Royal Bank of Scotland.

The investigative trail so far has led to computer-savvy teens looking to sell time on their army of commandeered PCs to spammers and fraudsters at the highest bid. Further up the chain, the trail runs cold.

"We think a big part of the operation--the virus-writing and the buying and selling of PC proxies--is kids," said Mikko Hypponen, antivirus research director at Finnish data security company F-Secure.

"We think crime groups are involved as well--but they seem to be using these kids as child labor."

Story Copyright © 2004 Reuters Limited. All rights reserved.

new worm - critical warning

Symantec is reporting the mail servers of various popular email services such as Hotmail and Yahoo to be bogged down with a new worn, code-named Evaman.

The security firm, Symantec, has given this worm a critical warning and states that this worm could be as as dangerous as the MyDoom virus.

Evaman occupies a false email address, sends itself to PC users as an attachment, and once the attachment is opened, the system turns into a host system to send out more emails with the same malicious code.

The headings are common to the ones users encounter everyday in their inbox - "Failed Transaction" or "Delivery Failure". This worm has the potential to take control over Windows 95, 98, ME, 2000, XP, NT, and Windows Server 2003.

According to some reports, it sometimes opens a common text file and selects a SMTP mail server from the already embedded list.

If for some reason Evaman can't connect to servers via its embedded list, it goes to a particular registery key in the system to connect. It then logs onto email.people.yahoo.com, searches for public email addresses, takes the information, and continues to spread.

Symantec reacted quickly on the threat and released a new patch, which is available on their website.

DVD Recorder Prices Expected to Plunge

Devices will be as much as 50 percent cheaper later this year,

he average selling price of DVD recorders is expected to fall by as much as 50 percent later this year as Taiwanese shipments of DVD recorders increase sharply, a government-backed market research firm in Taipei says.

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Taiwanese hardware makers excel at producing large volumes of IT hardware products at low cost. The ability to produce large volumes of IT products at low cost has made Taiwanese hardware makers the production leaders of many hardware components and devices, such as laptop computers. And Taiwanese companies will take a larger share of the market for DVD recorders as prices fall, Market Intelligence Center (MIC) says in a statement.

MIC is part of Taiwan's Institute of Information Industry, a government-backed think tank set up to support the development of the country's IT industry.

On the Increase

Taiwanese companies, including BenQ and LiteOn Technology, shipped around 1 million DVD recorders--including DVD+RW drives, DVD-RW drives, and DVD-RAM drives--worth $220 million during the first half of 2004, MIC says.

That's up twenty-fold from shipments of close to 50,000 units worth $14 million during the same period last year, MIC says.

By comparison, Taiwanese companies shipped 700,000 DVD recorders worth $140 million during the second half of last year, MIC says.

Looking ahead, Taiwanese companies could ship up to 2 million DVD recorders during the second half of this year, bringing the total number of DVD recorders shipped this year to 3 million units, MIC says.

Shipments of DVD recorders from Taiwanese companies have been boosted by growing sales in the North American and European markets and reflects an improved ability of Taiwanese companies to source key components, MIC says.

Supply and Demand

MIC says a drop in the price of key components, including DVD loaders and MPEG-2 decoder chips, will cause the average selling price of DVD recorders to fall by nearly 50 percent during the second half of this year. Combined with consumer interest in global sporting events, such as the 2004 Olympic Games in Athens, this price drop will spur demand higher for DVD recorders, it says.

Based on MIC's numbers for the shipments and value of Taiwanese-made DVD recorders, the average selling price for Taiwanese-made recorders was approximately $220 during the first half of the year. That represents a reduction of 22 percent compared with an average selling price of around $280 one year ago but an increase of 10 percent when compared with the average selling price of $200 during the second half of 2003.

Japanese companies are currently the world's largest producer of DVD recorders, accounting for around 50 percent of shipments during 2003, MIC says. European companies accounted for 10 percent of shipments while South Korean and Chinese companies each accounted for between 6 percent to 8 percent of shipments last year.

MIC did not specify what percentage of shipments came from Taiwanese companies, but says Taiwanese companies could account for 25 percent of shipments in 2004, making them the second-largest supplier of DVD recorders.