Three Charged for Working With Serial Swatter

The U.S. Justice Department has filed criminal charges against three U.S. men accused of swatting, or making hoax reports of bomb threats or murders in a bid to trigger a heavily armed police response to a target’s address. Investigators say the men, aged 19 to 23, all carried out the attacks with the help of Tyler Barriss, a convicted serial swatter whose last stunt in late 2018 cost an Oklahoma man his life.

Image: FBI.gov

FBI agents on Wednesday arrested Neal Patel, 23, of Des Plaines, Ill. and Tyler Stewart, 19 of Gulf Breeze, Fla. The third defendant, Logan Patten, 19, of Greenwood, Mo., agreed to turn himself in. The men are charged in three separate indictments with conspiracy and conveying false information about the use of explosive devices.

Investigators say Patten, who used the Twitter handle “@spared,” hired Barriss in December 2017 to swat individuals and a high school in Less’s Summit, Mo.

Around the same time, Stewart, a.k.a. “@tragic” on Twitter, allegedly worked with Barriss to make two phony bomb threats to evacuate a high school in Gurnee, Ill. In that incident, Barriss admitted telling police in Gurnee he had left explosives in a classroom and was high on methamphetamine and was thinking about shooting teachers and students.

Also in December 2017, Patel allegedly worked with Barriss to plan a bomb threat targeting a video game convention in Dallas, Texas. Patel is also accused of using stolen credit cards to buy items of clothing for Barriss.

The Justice Department’s media release on the indictments doesn’t specify which convention Barriss and Patel allegedly swatted, but a Wired story from last year tied Barriss to a similarly timed bomb threat that caused the evacuation of a major Call of Duty tournament at the Dallas Convention Center.

“When the social media star SoaR Ashtronova tweeted about the confusion she felt as she fled the event beneath the whir of police helicopters, Barriss taunted her from one of his Twitter accounts: ‘It got ran, baby girl. Thats what happens,” Wired reported.

Interestingly, it was a dispute over a $1.50 grudge match in a Call of Duty game that would ultimately lead to Barriss’s final — and fatal — swatting a year later. On Dec. 28, 2018, Barriss phoned police in Wichita, Kan. from his location in California, telling them he was a local man who’d just shot his father and was holding other family members hostage.

Prosecutors say Barriss did so after getting in the middle of a dispute between two Call of Duty gamers, 18-year-old Casey Viner from Ohio and Shane Gaskill, 20, from Wichita. Viner allegedly asked Barriss to swat Gaskill. But when Gaskill noticed Barriss’ Twitter account suddenly following him online, he tried to deflect the attack. Barriss says Gaskill allegedly dared him to go ahead with the swat, but then gave Barriss an old home address — which was then being occupied by someone else.

When Wichita police responded to the address given by Barriss, they shot and killed 28-year-old Andrew Finch, a father of two who had no party to the dispute and did not know any of the three men.

Both Viner and Gaskill have been charged with wire fraud, conspiracy and obstruction of justice. Barriss pleaded guilty in Nov. 2018 to a total of 51 charges brought by federal prosecutors in Los Angeles, Kansas and Washington, D.C. He has agreed to serve a sentence of between 20 to 25 years in prison. Barrris is slated to be sentenced on March 1, 2019.

Stewart’s attorney declined to comment. Lawyers assigned to Patel and Patten could not be reached for comment.

As the victim of a swatting attack in 2013 and several other unsuccessful attempts, I am pleased to see federal authorities continue to take this crime seriously. According to the FBI, each swatting incident costs emergency responders approximately $10,000. Each hoax also unnecessarily endangers the lives of the responders and the public, and draws important resources away from actual emergencies.

from
https://krebsonsecurity.com/2019/01/three-charged-for-working-with-serial-swatter/

How the U.S. Govt. Shutdown Harms Security

The ongoing partial U.S. federal government shutdown is having a tangible, negative impact on cybercrime investigations, according to interviews with federal law enforcement investigators and a report issued this week by a group representing the interests of FBI agents. Even if lawmakers move forward on new proposals to reopen the government, sources say the standoff is likely to have serious repercussions for federal law enforcement agencies for years to come.

One federal agent with more than 20 years on the job told KrebsOnSecurity the shutdown “is crushing our ability to take the fight to cyber criminals.”

“The talent drain after this is finally resolved will cost us five years,” said the source, who asked to remain anonymous because he was not authorized to speak to the news media. “Literally everyone I know who is able to retire or can find work in the private sector is actively looking, and the smart private companies are aware and actively recruiting. As a nation, we are much less safe from a cyber security posture than we were a month ago.”

The source said his agency can’t even get agents and analysts the higher clearances needed for sensitive cases because everyone who does the clearance processing is furloughed.

“Investigators who are eligible to retire or who simply wish to walk away from their job aren’t retiring or quitting now because they can’t even be processed out due to furlough of the organization’s human resources people,” the source said. “These are criminal investigations involving national security. It’s also a giant distraction and people aren’t as focused.”

The source’s comments echoed some of the points made in a 72-page report (PDF) released this week by the FBI Agents Association, a group that advocates on behalf of active and retired FBI special agents.

“Today we have no funds for making Confidential Human Source payments,” reads a quote from the FBIAA report, attributed to an agent in the FBI’s northeast region. “In my situation, I have two sources that support our national security cyber mission that no longer have funding. They are critical sources providing tripwires and intelligence that protect the United States against our foreign adversaries. The loss in productivity and pertinent intelligence is immeasurable.”

My federal law enforcement source mentioned his agency also was unable to pay confidential informants for their help with ongoing investigations.

“We are having the same problems like not being able to pay informants, no travel, critical case coordination meetings postponed, and no procurements to further the mission,” the source said.

The extended shutdown directly affects more than 800,000 workers, many of them furloughed or required to work without pay. Some federal employees, now missing at least two back-to-back paychecks, are having trouble keeping food on the table. CNN reports that FBI field offices across the country are opening food banks to help support special agents and staff struggling without pay.

An extended lack of pay is forcing many agents to seek side hustles and jobs, despite rules that seek to restrict such activity, according to media reports. Missing multiple paychecks also can force investigators to take on additional debt. This is potentially troublesome because excess debt down the road can lead to problems keeping one’s security clearances.

Excessive debt is a threat to clearances because it can make people more susceptible to being drawn into illegal activities or taking bribes for money, which in turn may leave them vulnerable to extortion. Indeed, this story from Clearancejobs.com observes that the shutdown may be inadvertently creating new recruiting opportunities for foreign intelligence operatives.

“If you are a hostile intelligence service human intelligence (HUMINT) targeting officer you are hoping this situation lasts a long time and has a multitude of unintended consequences affecting the cleared government employee population,” writes Christopher Burgess.

The shutdown may impact government and civilian cybersecurity efforts in other ways. As Brian Fung reported last week at The Washington Post, a rising number of federal Web sites are falling into disrepair, making it harder for Americans to access online services.

“In the past week, the number of outdated Web security certificates held by U.S. government agencies has exploded from about 80 to more than 130, according to Netcraft, an Internet security firm based in Britain,” Fung wrote.

Alex Stamos, former chief security officer at Facebook, said this creates problems for people trying to access key documents at government Web sites because the world’s dominant browser — Google Chrome — heavily discourages users from even visiting sites with expired security certificates.

But Stamos says he’s far more concerned about who’s maintaining, monitoring and safeguarding the countless Internet servers and other government online assets during the shutdown.

“What worries me more is what this indicates for the fact that there’s not standard maintenance going on,” Stamos said in this week’s episode of security journalist Patrick Gray‘s “Risky Business” podcast. “We’ve gone through a Patch Tuesday since the government shut down. Who is actually maintaining the systems, who is sitting in the SOCs [security operations centers], who’s looking at the logs? Even if you have critical cybersecurity people at NSA or Cyber Command working, there’s a lot of importance in having people show up for their jobs.”

U.S. Senate leaders are now planning to hold competing votes on Thursday in a bid to end the shutdown, but a story Wednesday in The New York Times reckons that neither measure is expected to draw the 60 votes required to advance.

“You hear [New England Patriots football coach Bill] Belichick and other coaches constantly preaching about leaving distractions outside the locker room,” said the federal law enforcement source who spoke with this author. “Can’t think of many bigger distractions like not getting paid, damaging credit scores, not being able to pay bills, and losing supplemental insurance. We just wish our national leaders would listen to another Belichick gem: ‘Do Your Job.'”

from
https://krebsonsecurity.com/2019/01/how-the-u-s-govt-shutdown-harms-security/

Bomb Threat, Sextortion Spammers Abused Weakness at GoDaddy.com

Two of the most disruptive and widely-received spam email campaigns over the past few months — including an ongoing sextortion email scam and a bomb threat hoax that shut down dozens of schools, businesses and government buildings late last year — were made possible thanks to an authentication weakness at GoDaddy.com, the world’s largest domain name registrar, KrebsOnSecurity has learned.

Perhaps more worryingly, experts warn this same weakness that let spammers hijack domains registered through GoDaddy also affects a great many other major Internet service providers, and is actively being abused to launch phishing and malware attacks which leverage dormant Web site names currently owned and controlled by some of the world’s most trusted corporate names and brands.

In July 2018, email users around the world began complaining of receiving spam which began with a password the recipient used at some point in the past and threatened to release embarrassing videos of the recipient unless a bitcoin ransom was paid. On December 13, 2018, a similarly large spam campaign was blasted out, threatening that someone had planted bombs within the recipient’s building that would be detonated unless a hefty bitcoin ransom was paid by the end of the business day.

Experts at Cisco Talos and other security firms quickly drew parallels between the two mass spam campaigns, pointing to a significant overlap in Russia-based Internet addresses used to send the junk emails. Yet one aspect of these seemingly related campaigns that has been largely overlooked is the degree to which each achieved an unusually high rate of delivery to recipients.

Large-scale spam campaigns often are conducted using newly-registered or hacked email addresses, and/or throwaway domains. The trouble is, spam sent from these assets is trivial to block because anti-spam and security systems tend to discard or mark as spam any messages that appear to come from addresses which have no known history or reputation attached to them.

However, in both the sextortion and bomb threat spam campaigns, the vast majority of the email was being sent through Web site names that had already existed for some time, and indeed even had a trusted reputation. Not only that, new research shows many of these domains were registered long ago and are still owned by dozens of Fortune 500 and Fortune 1000 companies. 

That’s according to Ron Guilmette, a dogged anti-spam researcher who has made a living suing spammers and helping law enforcement officials apprehend online scammers. Researching the history and reputation of more than 5,000 Web site names used in each of the extortionist spam campaigns, Guilmette made a startling discovery: Virtually all of them had at one time been registered via GoDaddy.com, a Scottsdale, Ariz. based domain name registrar and hosting provider.

Guilmette told KrebsOnSecurity he initially considered the possibility that GoDaddy had been hacked, or that thousands of the registrar’s customers perhaps had their GoDaddy usernames and passwords stolen.

But as he began digging deeper, Guilmette came to the conclusion that the spammers were exploiting an obscure — albeit widespread — weakness among hosting companies, cloud providers and domain registrars that was first publicly detailed in 2016.

EARLY WARNING SIGNS

In August 2016, security researcher Matthew Bryant wrote about spammers hijacking some 20,000 established domain names to blast out junk email. A few months later, Bryant documented the same technique being used to take over more than 120,000 trusted domains for spam campaigns. And Guilmette says he now believes the attack method detailed by Bryant also explains what’s going on in the more recent sextortion and bomb threat spams.

Grasping the true breadth of Bryant’s prescient discovery requires a brief and simplified primer on how Web sites work. Your Web browser knows how to find a Web site name like example.com thanks to the global Domain Name System (DNS), which serves as a kind of phone book for the Internet by translating human-friendly Web site names (example.com) into numeric Internet address that are easier for computers to manage.

When someone wants to register a domain at a registrar like GoDaddy, the registrar will typically provide two sets of DNS records that the customer then needs to assign to his domain. Those records are crucial because they allow Web browsers to figure out the Internet address of the hosting provider that’s serving that Web site domain. Like many other registrars, GoDaddy lets new customers use their managed DNS services for free for a period of time (in GoDaddy’s case it’s 30 days), after which time customers must pay for the service.

The crux of Bryant’s discovery was that the spammers in those 2016 campaigns learned that countless hosting firms and registrars would allow anyone to add a domain to their account without ever validating that the person requesting the change actually owned the domain. Here’s what Bryant wrote about the threat back in 2016:

“In addition to the hijacked domains often having past history and a long age, they also have WHOIS information which points to real people unrelated to the person carrying out the attack. Now if an attacker launches a malware campaign using these domains, it will be harder to pinpoint who/what is carrying out the attack since the domains would all appear to be just regular domains with no observable pattern other than the fact that they all use cloud DNS. It’s an attacker’s dream, troublesome attribution and an endless number of names to use for malicious campaigns.”

SAY WHAT?

For a more concrete example of what’s going on here, we’ll look at just one of the 5,000+ domains that Guilmette found were used in the Dec. 13, 2018 bomb threat hoax. Virtualfirefox.com is a domain registered via GoDaddy in 2013 and currently owned by The Mozilla Corporation, a wholly owned subsidiary of the Mozilla Foundation — the makers of the popular Firefox Web browser.

The domain’s registration has been renewed each year since its inception, but the domain itself has sat dormant for some time. When it was initially set up, it took advantage of two managed DNS servers assigned to it by GoDaddy — ns17.domaincontrol.com, and ns18.domaincontrol.com.

GoDaddy is a massive hosting provider, and it has more than 100 such DNS servers to serve the needs of its clients. To hijack this domain, the attackers in the December 2018 spam campaign needed only to have created a free account at GoDaddy that was assigned the exact same DNS servers handed out to Virtualfirefox.com (ns17.domaincontrol.com and ns18.domaincontrol.com). After that, the attackers simply claim ownership over the domain, and tell GoDaddy to route all traffic for that domain to an Internet address they control.

Mozilla spokesperson Ellen Canale said Mozilla took ownership of virtualfirefox.com in September 2017 after a trademark dispute, but that the DNS nameserver for the record was not reset until January of 2019.

“This oversight created a state where the DNS pointed to a server controlled by a third party, leaving it vulnerable to misuse,” Canale said. “We’ve reviewed the configuration of both our registrar and nameservers and have found no indication of misuse. In addition to addressing the immediate problem, we have reviewed the entire catalog of properties we own to ensure they are properly configured.”

According to both Guilmette and Bryant, this type of hijack is possible because GoDaddy — like many other managed DNS providers — does little to check whether someone with an existing account (free or otherwise) who is claiming ownership over a given domain actually controls that domain name.

“During this entire time, and continuing to the present moment, the same bad actor(s) who were responsible for the massive wave of bomb threat bitcoin extortion spams that were emailed to five countries on December 13th, 2018 have been in a position to add, delete, or modify any DNS record associated with any domain name that uses the GoDaddy DNS service,” Guilmette said.

Contacted by KrebsOnSecurity, GoDaddy acknowledged the authentication weakness documented by Guilmette.

“After investigating the matter, our team confirmed that a threat actor(s) abused our DNS setup process,” the company said in an emailed statement.

“We’ve identified a fix and are taking corrective action immediately,” the statement continued. “While those responsible were able to create DNS entries on dormant domains, at no time did account ownership change nor was customer information exposed.”

SPAMMY BEAR

Guilmette has dubbed the criminals responsible as “Spammy Bear” because the majority of the hijacked domains used in the spam campaigns traced back to Internet addresses in Russia.

In the case of Mozilla’s Virtualfirefox.com domain, historic DNS records archived by Farsight Security show that indeed on Dec. 13, 2018 — the very same day that spammers began blasting out their bomb threat demands — the Internet address in the domain’s DNS records at GoDaddy were changed to 194.58.58[.]70, a server in the Russian Federation owned by a hosting company there called Reg.ru.

The record above, indexed by Farsight Security, shows that the Internet address for virtualfirefox.com was changed to an ISP in Russia on Dec. 13, 2018, the same day spammers used this domain and more than 5,000 others for a mass emailed bomb threat.

In fact, Guilmette found that that at least 3,500 of the commandeered domains traced back to Reg.ru and to a handful of other hosting firms in Russia. The next largest collection of fraudulently altered Internet addresses were assigned to hosting providers in the United States (456), although some of those providers (e.g. Webzilla/WZ Communications) have strong ties to Russia. The full list of Internet addresses is available here.

Guilmette’s sleuthing on the 5,000+ domains abused in both 2018 spam campaigns, combined with data from Farsight, suggest the spammers hijacked domains belonging to a staggering number of recognizable corporations who registered domains at GoDaddy, including but not limited to:

Abbott Laboratories; Ancestry.com; Autodesk; Capital One; CVS Pharmacy; SSL provider Digicert; Dow Chemical; credit card processors Elavon and Electronic Merchant Systems; Fair Isaac Corp.; Facebook; Gap (Apparel) Inc; Fifth Third Bancorp; Hearst Communications; Hilton Interntional; ING Bank; the Massachusetts Institute of Technology (MIT); McDonalds Corp.; NBC Universal Media; NRG Energy; Oath, Inc (a.k.a Yahoo + AOL); Oracle; Tesla Motors; Time Warner; US Bank; US Steel Corp.; National Association; Viacom International; and Walgreens.

In an interview with KrebsOnSecurity, Bryant said the domain hijacking technique can be a powerful tool in the hands of spammers and scammers, who can use domains associated with these companies not only to get their missives past junk and malware filters, but also to make phishing and malware lures far more believable and effective.

“This is extremely advantageous to attackers because they don’t have to pay any money to set it all up, and there’s a strong reputation attached to the domain they’re sending from,” Bryant said. “A lot of services will flag email from unknown domains as high risk, but the domains being hijacked by these guys have a good history and reputation behind them. This method also probably greatly complicates any sort of investigatory efforts after the spam campaign is over.”

WHAT CAN BE DONE?

Guilmette said managed DNS providers can add an extra layer of validation to DNS change requests, checking to see if a given domain already has internal DNS servers assigned to the domain before processing the request. Providers could nullify the threat by simply choosing a different pair of DNS servers to assign to the request. The same validation process would work similarly at other managed DNS providers.

“As long as they’re different, that ruins this attack for the spammers,” Guilmette said. “The spammers want the DNS servers to be the same ones that were already there when the domain was first set up, because without that they can’t pull of this hack. All GoDaddy has to do is see if this particularly odd set of circumstances apply in each request.”

Bryant said after he published his initial research in 2016, a number of managed DNS providers mentioned in his blog posts said they’d taken steps to blunt the threat, including Amazon Web Services (AWS), hosting provider Digital Ocean, and Google Cloud. But he suspects this is still a “fairly common” weakness and hosting providers and registrars, and many providers simply aren’t convinced of the need to add this extra precaution.

“A lot of the providers are of the opinion that it’s down to a user mistake and not a vulnerability they should have to fix,” he said. “But it’s clearly still a big problem.”

from
https://krebsonsecurity.com/2019/01/bomb-threat-sextortion-spammers-abused-weakness-at-godaddy-com/

773M Password ‘Megabreach’ is Years Old

My inbox and Twitter messages positively lit up today with people forwarding stories from Wired and other publications about a supposedly new trove of nearly 773 million unique email addresses and 21 million unique passwords that were posted to a hacking forum. A story in The Guardian breathlessly dubbed it “the largest collection ever of breached data found.” But in an interview with the apparent seller, KrebsOnSecurity learned that it is not even close to the largest gathering of stolen data, and that it is at least two to three years old.

The dump, labeled “Collection #1” and approximately 87GB in size, was first detailed earlier today by Troy Hunt, who operates the HaveIBeenPwned breach notification service. Hunt said the data cache was likely “made up of many different individual data breaches from literally thousands of different sources.”

KrebsOnSecurity sought perspective on this discovery from Alex Holden, CTO of Hold Security, a company that specializes in trawling underground spaces for intelligence about malicious actors and their stolen data dumps. Holden said the data appears to have first been posted to underground forums in October 2018, and that it is just a subset of a much larger tranche of passwords being peddled by a shadowy seller online.

Here’s a screenshot of a subset of that seller’s current offerings, which total almost 1 Terabyte of stolen and hacked passwords:

The 87GB “Collection1” archive is one of but many similar tranches of stolen passwords being sold by a particularly prolific ne’er-do-well in the underground.

As we can see above, Collection #1 offered by this seller is indeed 87GB in size. He also advertises a Telegram username where he can be reached — “Sanixer.” So, naturally, KrebsOnSecurity contacted Sanixer via Telegram to find out more about the origins of Collection #1, which he is presently selling for the bargain price of just $45.

Sanixer said Collection#1 consists of data pulled from a huge number of hacked sites, and was not exactly his “freshest” offering. Rather, he sort of steered me away from that archive, suggested that — unlike most of his other wares — Collection #1 was at least 2-3 years old. His other password packages, which he said are not all pictured in the above screen shot and total more than 4 terabytes in size, are less than a year old, Sanixer explained.

By way of explaining the provenance of Collection #1, Sanixer said it was a mix of “dumps and leaked bases,” and then he offered an interesting screen shot of his additional collections. Click on the image below and notice the open Web browser tab behind his purloined password trove (which is apparently stored at Mega.nz): Troy Hunt’s published research on this 773 million Collection #1.

Sanixer says Collection #1 was from a mix of sources. A description of those sources can be seen in the directory tree on the left side of this screenshot.

Holden said the habit of collecting large amounts of credentials and posting it online is not new at all, and that the data is far more useful for things like phishing, blackmail and other indirect attacks — as opposed to plundering inboxes. Holden added that his company had already derived 99 percent of the data in Collection #1 from other sources.

“It was popularized several years ago by Russian hackers on various Dark Web forums,” he said. “Because the data is gathered from a number of breaches, typically older data, it does not present a direct danger to the general user community. Its sheer volume is impressive, yet, by account of many hackers the data is not greatly useful.”

A core reason so many accounts get compromised is that far too many people have the nasty habit(s) of choosing poor passwords, re-using passwords and email addresses across multiple sites, and not taking advantage of multi-factor authentication options when they are available.

If this Collection #1 has you spooked, changing your password(s) certainly can’t hurt — unless of course you’re in the habit of re-using passwords. Please don’t do that. As we can see from the offering above, your password is probably worth way more to you than it is to cybercriminals (in the case of Collection #1, just .000002 cents per password).

For most of us, by far the most important passwords are those protecting our email inbox(es). That’s because in nearly all cases, the person who is in control of that email address can reset the password of any services or accounts tied to that email address – merely by requesting a password reset link via email. For more on this dynamic, please see The Value of a Hacked Email Account.

Your email account may be worth far more than you imagine.

And instead of thinking about passwords, consider using unique, lengthy passphrases — collections of words in an order you can remember — when a site allows it. In general, a long, unique passphrase takes for more effort to crack than a short, complex one. Unfortunately, many sites do not let users choose passwords or passphrases that exceed a small number of characters, or they will otherwise allow long passphrases but ignore anything entered after the character limit is reached.

If you are the type of person who likes to re-use passwords, then you definitely need to be using a password manager, which helps you pick and remember strong and unique passwords/passphrases and essentially lets you use the same strong master password/passphrase across all Web sites.

Finally, if you haven’t done so lately, mosey on over to twofactorauth.org and see if you are taking full advantage of multi-factor authentication at sites you trust with your data. The beauty of multi-factor is that even if thieves manage to guess or steal your password just because they hacked some Web site, that password will be useless to them unless they can also compromise that second factor — be it your mobile device or security key.

from
https://krebsonsecurity.com/2019/01/773m-password-megabreach-is-years-old/

“Stole $24 Million But Still Can’t Keep a Friend”

Unsettling new claims have emerged about Nicholas Truglia, a 21-year-old Manhattan resident accused of hijacking cell phone accounts to steal tens of millions of dollars in cryptocurrencies from victims. The lurid details, made public in a civil lawsuit filed this week by one of his alleged victims, paints a chilling picture of a man addicted to thievery and all its trappings. The documents suggest that Truglia stole from his father and even a dead man — all the while lamenting that his fabulous new wealth brought him nothing but misery.

The unflattering profile was laid out in a series of documents tied to a lawsuit lodged by Michael Terpin, a cryptocurrency investor who co-founded the first angel investor group for bitcoin enthusiasts in 2013. Terpin alleges that crooks stole almost $24 million worth of cryptocurrency after fraudulently executing a “SIM swap” on his mobile phone account at AT&T in early 2018. Terpin also is pursuing a $200 million civil lawsuit against AT&T in connection with the theft.

Authorities arrested Truglia on November 14, 2018 on suspicion of using SIM swaps to steal approximately $1 million worth of cryptocurrencies from a different Silicon Valley executive. But Terpin’s civil lawsuit (PDF) maintains that evidence was revealed at Truglia’s bail hearing that he had texted his father and multiple friends to brag about the $24 million hack on the day of Terpin’s theft, allegedly offering to take friends to the Super Bowl with “porn star escorts.”

Terpin’s lawsuit includes a large number of supporting documents, including an affidavit filed by Chris David, a 25-year-old New York City resident who claims to have been an acquaintance of Truglia’s until he began to unravel the source of his new friend’s overnight riches.

In his affidavit (PDF), David describes himself as a self-employed private jet broker who met Truglia in a fitness center attached to Truglia’s luxury apartment building. Truglia allegedly struck up a conversation about booking private jets with his cryptocurrency. When the two met again a few days later, David says Truglia showed him accounts on his mobile phone and computer indicating he had over $7 million in cash in a JP Morgan account and more than $12 million in various cryptocurrencies.

“At the same time, Nick showed me two thumb drives (Trezors),” David recounted. “One had over $40 million in cash value of various cryptos, and the other one had over $20 million cash value of various cryptos.”

David said Truglia initially explained his wealth by saying he’d made the money by mining cryptocurrencies, but that Truglia later would admit he stole the funds.

“Over the next few months, Nick and I socialized at nightclubs, local bars, the gym, and in his apartment playing video games,” David recounted. “Gradually, I got to know Nick. He does not have a job or visible means of support. His typical day is to get up late, go to the gym, eat at the deli across the street, play video games late into the night and he had no friends. Nick was an egotistical braggart about his life and wealth. For example, once at a crowded lounge, he said: ‘Chris, I have more money than all of the people here tonight.'”

David started documenting Truglia’s activities after he and several of his friends were arrested for allegedly stealing Truglia’s laptop, mobile phone and Trezor drive. That incident, recounted in this New York Post story  and in David’s own testimony, indicates that Truglia later recanted the accusation and chalked it up to confusion resulting from a heavy night of drinking.

According to David, when Truglia wasn’t bragging about his wealth he was displaying it openly: He lived in a $6,000 per month apartment, wore a Rolex watch which he claimed cost $100,000, and boasted he was going to purchase a $250,000 McLaren sports car. David also said he recorded conversations with Truglia in which the latter admitted to stealing $24 million from Terpin.

David said he even witnessed Truglia attempting a SIM swap at a Times Square AT&T store in August 2018. Here’s David’s account of that hijack effort, which allegedly failed when Truglia declined to pay the target’s overdue phone bill:

The affidavit states that later in the month David took screen shots of a now-defunct Twitter account that Truglia allegedly used (@erupts), which included six different messages about what the theft of $24 million had wrought.

Tweets from the account @erupts, allegedly penned by Nicholas Truglia.

“Stole 24 million but still can’t keep a friend,” reads another tweet allegedly tied to Truglia’s account:

David says Truglia even acknowledged stealing $15,000 after hacking into his own father’s accounts. According to David, Truglia’s dad asked to be repaid, and that his son agreed to return the money — but in bitcoin. In the image below — which David claims was a screenshot he took of a mobile phone chat conversation between Truglia and his father — the elder expresses mystification and frustration about how to complete the transaction.

A screen shot David says he took of an alleged chat conversation between Truglia and his father regarding repayment of $15,000.

In the affidavit, David also testifies that he saw Truglia in possession of a fake New York State driver’s license which had the name and identifying information of a deceased man named Quentin Capobianco, but with Truglia’s photo on the license.

A copy of this phony drivers’ license was documented by investigators with the Regional Enforcement Allied Computer Team, or REACT — a task force in Santa Clara, Calif. that is almost singularly focused on tracking down criminals who use unauthorized SIM swaps to steal virtual currencies (for a deep dive into the workings of the REACT Task Force, see my November 2018 story, Busting SIM Swappers and SIM Swap Myths).

David said he took this photograph of a license Truglia had in his possession; the license includes Truglia’s photograph but the information of a dead man that Truglia allegedly SIM swapped.

That REACT Task Force investigation report (PDF) was included in Terpin’s lawsuit, and it lays out how detectives tied Truglia to SIM swaps that allegedly gave him access to Capobianco’s accounts at Coinbase, a virtual currency trading and purchasing platform.

David testified that despite Truglia’s ill-gotten riches, he was constantly borrowing small amounts of cash and was otherwise tight with his money. Much like David’s testimony, a related memo (PDF) filed by REACT Detective Caleb Tuttle suggests that Truglia was in the process of being evicted from his pricey Manhattan apartment because he refused to pay his rent.

A snippet from a memo filed about Truglia by REACT Task Force Detective Caleb Tuttle.

Truglia is currently being held by Santa Clara authorities on a $1.4 million bond. His next court date is April 10. Neither Truglia nor his attorney could be immediately reached for comment. Members of the REACT Task Force declined to comment for this story.

A SIM card is the tiny, removable chip in a mobile device that allows it to connect to the provider’s network. Customers can legitimately request a SIM swap when their existing SIM card has been damaged, or when they are switching to a different phone that requires a SIM card of another size.

But SIM swaps are frequently abused by scam artists who trick mobile providers into tying a target’s service to a new SIM card and mobile phone that the attackers control. Unauthorized SIM swaps often are perpetrated by fraudsters who have already stolen or phished a target’s password, as many banks and online services rely on text messages to send users a one-time code that needs to be entered in addition to a password for online authentication. However, many online services let customers reset their password merely by using their mobile phones.

All four major wireless carriers — AT&T, Sprint, T-Mobile and Verizon — let customers add security against SIM swaps and related schemes by setting a PIN that needs to be provided over the phone or in person at a store before account changes should be made. But these security features can be bypassed by incompetent or corrupt mobile store employees.

For more on ways to minimize your chances of becoming the next SIM swapping victim, check out the “What Can You Do?” section at the conclusion of this story.

from
https://krebsonsecurity.com/2019/01/stole-24-million-but-still-cant-keep-a-friend/

Courts Hand Down Hard Jail Time for DDoS

Seldom do people responsible for launching crippling cyberattacks face justice, but increasingly courts around the world are making examples of the few who do get busted for such crimes. On Friday, a 34-year-old Connecticut man received a whopping 10-year prison sentence for carrying out distributed denial-of-service (DDoS) attacks against a number of hospitals in 2014. Also last week, a 30-year-old in the United Kingdom was sentenced to 32 months in jail for using an army of hacked devices to crash large portions of Liberia’s Internet access in 2016.

Daniel Kaye. Photo: National Crime Agency

Daniel Kaye, an Israel-U.K. dual citizen, admitted attacking an African phone company in 2016, and to inadvertently knocking out Internet access for much of the country in the process. Kaye launched the attack using a botnet powered by Mirai, a malware strain that enslaves hacked Internet of Things (IoT) devices like poorly-secured Internet routers and Web-based cameras for use in large-scale cyberattacks.

According to court testimony, Kaye was hired in 2015 to attack Lonestar, Liberia’s top mobile phone and Internet provider. Kaye pocketed $10,000 for the attack, which was alleged to have been paid for by an individual working for Cellcom, Lonestar’s competitor in the region. As reported by Israeli news outlet Haaretz, Kaye testified that the attack was ordered by the CEO of Cellcom Liberia.

In February 2017, authorities in the United Kingdom arrested Kaye an extradited him to Germany to face charges of knocking more than 900,000 Germans offline in a Mirai attack in November 2016. Prosecutors withheld Kaye’s full name throughout the trial in Germany, but in July 2017 KrebsOnSecurity published findings that named Kaye as the likely culprit. Kaye ultimately received a suspended sentence for the attack in Germany, and was sent back to the U.K. to face charges there.

The July 2017 KrebsOnSecurity investigation also linked Kaye to the development and sale of a sophisticated piece of spyware named GovRAT, which is documented to have been used in numerous cyber espionage campaigns against governments, financial institutions, defense contractors and more than 100 corporations.

The U.K.’s National Crime Agency called Kaye perhaps the most significant cyber criminal yet caught in Britain. A report on the trial from the BBC says Kaye wept as he was taken away to jail.

Here across the pond, 34-year-old Martin Gottesfeld was sentenced to 10 years in prison and ordered to pay $443,000 in restitution for damages caused by a series of DDoS attacks he launched against several Boston-area hospitals in 2014. Like Kaye, Gottesfeld was identified thanks to clue he left behind on the Internet: Prosecutors reportedly linked him to a video he uploaded to Youtube about the attack campaign.

The Boston Globe reports that Gottesfeld and his wife in 2016 tried to flee to Cuba in a rented boat, but the trip didn’t go as planned. It seems the high seas had their own denial-of-service in store for the Gottesfelds: They were rescued from the Gulf of Mexico by a Disney ship that answered Martin’s SOS distress call and brought them back to the United States.

Ten years may seem like a stiff sentence for DDoS and fleeing from justice, but as the recipient of hundreds of DDoS attacks over the years I can’t say it bothers me one bit — especially considering how few of the anonymous cowards responsible for DDoS attacks are ever held accountable.

Cue the usual comments here about how these guys deserved jobs and not jail, but I for one am glad the courts are starting to recognize that these are real and costly crimes that deserve equally real consequences. Remember: Don’t do the crime if you can’t do the time.

from
https://krebsonsecurity.com/2019/01/courts-hand-down-hard-jail-time-for-ddos/

Secret Service: Theft Rings Turn to Fuze Cards

Street thieves who specialize in cashing out stolen credit and debit cards increasingly are hedging their chances of getting caught carrying multiple counterfeit cards by relying on Fuze Cards, a smartcard technology that allows users to store dozens of cards on a single device, the U.S. Secret Service warns.

A Fuze card can store up to 30 credit/debit cards. Image: Fuzecard.com

Launched in May 2017, the Fuze Card is a data storage device that looks like a regular credit card but can hold account data for up to 30 credit cards. The Fuze Card displays no credit card number on either side, instead relying on a small display screen on the front that cardholders can use to change which stored card is to be used to complete a transaction.

After the user chooses the card data to be used, the card data is made available in the dynamic magnetic stripe on the back of the card or via the embedded smart chip. Fuze cards also can be used at ATMs to withdraw funds.

An internal memo the U.S. Secret Service shared with financial industry partners states that Secret Service field offices in New York and St. Louis are currently working criminal investigations where Fuze Cards have been used by fraud rings.

The memo, a copy of which was obtained by KrebsOnSecurity, states that card theft rings are using Fuze Cards to avoid raising suspicions that may arise when shuffling through multiple counterfeit cards at the register.

“The transaction may also appear as a declined transaction but the fraudster, with the push of a button, is changing the card numbers being used,” the memo notes.

Fraud rings often will purchase data on thousands of credit and debit cards stolen from hacked point-of-sale devices or obtained via physical card skimmers. The data can be encoded onto any card with a magnetic stripe, and then used to buy high-priced items at retail outlets — or to withdrawn funds from ATMs (if the fraudsters also have the cardholder’s PIN).

But getting caught holding dozens of counterfeit or stolen cards is tough to explain to authorities. Hence, the allure of the Fuze Card, which may appear to the casual observer to be just another credit card in one’s wallet.

“While this smart card technology makes up a small portion of fraudulent credit cards currently, investigators should be aware of the potential for significant increases in fraud loss amounts with the emergence of this smart card technology,” the Secret Service memo concludes.

Fuze Card did not respond to requests for comment.

In many ways, it is unsurprising that thieves are turning to this new technology to perpetrate credit card fraud, which is something of a constant cat-and-mouse game that employs ever-changing techniques. For evidence of this, one need only look to the constant innovations that fraudsters come up with to deploy physical card skimmers at ATMs and retail checkout lanes.

No doubt, fraudsters engaged in money laundering via virtual currencies like bitcoin will be doubly interested in Fuze Cards in the coming months. Fuze Card says that later this year it plans to launch FuzeX, which contains the same amenities of the Fuze Card and will allow users to conduct purchases using virtual currencies.

from
https://krebsonsecurity.com/2019/01/secret-service-theft-rings-turn-to-fuze-cards/

Patch Tuesday, January 2019 Edition

Microsoft on Tuesday released updates to fix roughly four dozen security issues with its Windows operating systems and related software. All things considered, this first Patch Tuesday of 2019 is fairly mild, bereft as it is of any new Adobe Flash updates or zero-day exploits. But there are a few spicy bits to keep in mind. Read on for the gory details.

The updates released Tuesday affect Windows, Internet Explorer and Edge, Office, Sharepoint, .NET Framework and Exchange. Patches are available for all client and server versions of Windows, but none of the “critical” flaws — those that can lead to a remote system compromise without any help from users — apply to Windows 7 or Windows 8.1, according to Martin Brinkmann at Ghacks.net.

Mercifully, none of the vulnerabilities fixed in Tuesday’s bundle are being actively exploited, although one (CVE-2019-0579) was publicly disclosed prior to the patch release, meaning attackers may have had a head start figuring out how to exploit it. This bug is one of 11 that Microsoft fixed in its Jet Database Engine.

Among the more eyebrow-raising flaws fixed this week is CVE-2019-0547, a weakness in the Windows component responsible for assigning Internet addresses to host computers (a.k.a. “Windows DHCP client”). According to security vendor Tenable, this is the most severe bug of the entire patch batch.

“In order to exploit the vulnerability, an attacker would need to be able to send a specially crafted DHCP response to its target, allowing them to run arbitrary code on the client machine,” said Satnam Narang, senior research engineer at Tenable.

Tuesday’s update bundle also includes a fix that Microsoft released late last month as an emergency patch to plug a zero-day flaw in Internet Explorer (CVE-2018-8653) that attackers are already exploiting. Experts at Recorded Future say that vulnerability continues to be exploited in the wild, with several exploit kits now including the publicly released proof-of-concept code into their platforms.

“If you have not patched this vulnerability yet, it should be the number one priority,” writes Allan Liska, senior solutions architect at Recorded Future.

It generally can’t hurt for Windows users to wait a day or two after Microsoft releases monthly security updates before installing the fixes; occasionally buggy patches can cause serious headaches for users who install them before all the kinks are worked out.

Case in point: Computerworld’s Woody Leonhard notes that multiple organizations are reporting problems with their file-sharing operations after installing this month’s patch rollup.

Windows 10 likes to install patches all in one go and reboot your computer on its own schedule. Microsoft doesn’t make it easy for Windows 10 users to change this setting, but it is possible. For all other Windows OS users, if you’d rather be alerted to new updates when they’re available so you can choose when to install them, there’s a setting for that in Windows Update. Also, it’s a good idea to get in the habit of backing up your data before installing Windows updates.

Adobe released an update for its Flash Player plugin, but alas there don’t appear to be any security fixes in it. However, the company last Thursday did release new versions of its Adobe Acrobat and Reader that correct at least two critical vulnerabilities in each.

If you experience any problems installing any of these patches this month, please feel free to leave a comment about it below; there’s a good chance other readers have experienced the same and may even chime in here with some helpful tips.

from
https://krebsonsecurity.com/2019/01/patch-tuesday-january-2019-edition/

Dirt-Cheap, Legit, Windows Software: Pick Two

Buying heavily discounted, popular software from second-hand sources online has always been something of an iffy security proposition. But purchasing steeply discounted licenses for cloud-based subscription products like recent versions of Microsoft Office can be an extremely risky transaction, mainly because you may not have full control over who has access to your data.

Last week, KrebsOnSecurity heard from a reader who’d just purchased a copy of Microsoft Office 2016 Professional Plus from a seller on eBay for less than $4. Let’s call this Red Flag #1, as a legitimately purchased license of Microsoft Office 2016 is still going to cost between $70 and $100. Nevertheless, almost 350 other people had made the same purchase from this seller over the past year, according to eBay, and there appear to be many auctioneers just like this one.

After purchasing the item, the buyer said he received the following explanatory (exclamatory?) email from the seller — “Newhotsale68” from Vietnam:

Hello my friend!
Thank you for your purchase:)

Very important! Office365 is a subscription product and does not require any KEY activation. Account + password = free lifetime use

1. Log in with the original password and the official website will ask you to change your password!

2. Be sure to remember the modified new password. Once you forget your password, you will lose Office365!

3. After you change your password, log on to the official website to start downloading and installing Office365!

Your account information:

* USERMANE : (sent username)
Password Initial: (sent password)
Microsoft Office 365 access link:

Http://portal.office.com/

Sounds legit, right?

This merchant appears to be reselling access to existing Microsoft Office accounts, because in order to use this purchase the buyer must log in to Microsoft’s site using someone else’s username and password! Let’s call this Red Flag #2.

More importantly, the buyer can’t change the email address associated with the license, which means whoever owns that address can likely still assume control over any licenses tied to it. We’ll call this Ginormous Red Flag #3.

“The username that you use to register and activate Office is one that they provide to you in their email when you buy the license on eBay,” wrote the reader who alerted me about this dodgy transaction. “You never use your own email account to register, you have to log in with theirs. Once you’re inside the account you can’t change the username to your email account because the admin locked it down.”

Here’s what the profile looked like when the reader tried to change details tied to the license.

This version of Office prompts the user to sync all data and documents over to a 5TB Microsoft OneDrive account. What could go wrong?

“You can sign out of their Microsoft account to break the connection to the OneDrive account,” the reader said. “By default it had me signed in and I bet most people installing this just click next and stay signed in.”

That’s not all: The account was set up so that the administrator (seller) maintained control over specific apps on the Office installation, including OneNote and Class Notebook.

“I guess maybe the end result of all of this are the old adages, ‘you get what you pay for’ and, ‘if it sounds too good to be true than it probably is,'” the reader said at the conclusion of his email.

Couldn’t have said it better myself.

from
https://krebsonsecurity.com/2019/01/dirt-cheap-legit-windows-software-pick-two/

Apple Phone Phishing Scams Getting Better

A new phone-based phishing scam that spoofs Apple Inc. is likely to fool quite a few people. It starts with an automated call that display’s Apple’s logo, address and real phone number, warning about a data breach at the company. The scary part is that if the recipient is an iPhone user who then requests a call back from Apple’s legitimate customer support Web page, the fake call gets indexed in the iPhone’s “recent calls” list as a previous call from the legitimate Apple Support line.

Jody Westby is the CEO of Global Cyber Risk LLC,  a security consulting firm based in Washington, D.C. Westby said earlier today she received an automated call on her iPhone warning that multiple servers containing Apple user IDs had been compromised (the same scammers had called her at 4:34 p.m. the day before, but she didn’t answer that call). The message said she needed to call a 1-866 number before doing anything else with her phone.

Here’s what her iPhone displayed about the identity of the caller when they first tried her number at 4:34 p.m. on Jan. 2, 2019:

What Westby’s iPhone displayed as the scam caller’s identity. Note that it lists the correct Apple phone number, street address and Web address (minus the https://).

Note in the above screen shot that it lists Apple’s actual street address, their real customer support number, and the real Apple.com domain (albeit without the “s” at the end of “http://”). The same caller ID information showed up when she answered the scammers’ call this morning.

Westby said she immediately went to the Apple.com support page (https://www.support.apple.com) and requested to have a customer support person call her back. The page displayed a “case ID” to track her inquiry, and just a few minutes later someone from the real Apple Inc. called her and referenced that case ID number at the start of the call.

Westby said the Apple agent told her that Apple had not contacted her, that the call was almost certainly a scam, and that Apple would never do that — all of which she already knew. But when Westby looked at her iPhone’s recent calls list, she saw the legitimate call from Apple had been lumped together with the scam call that spoofed Apple:

The fake call spoofing Apple — at 11:44 a.m. — was lumped in the same recent calls list as the legitimate call from Apple. The call at 11:47 was the legitimate call from Apple. The call listed at 11:51 a.m. was the result of Westby accidentally returning the call from the scammers, which she immediately disconnected.

The call listed at 11:51 a.m. was the result of Westby accidentally returning the call from the scammers, which she immediately disconnected.

“I told the Apple representative that they ought to be telling people about this, and he said that was a good point,” Westby said. “This was so convincing I’d think a lot of other people will be falling for it.”

KrebsOnSecurity called the number that the scam message asked Westby to contact (866-277-7794). An automated system answered and said I’d reached Apple Support, and that my expected wait time was about one minute and thirty seconds. About a minute later, a man with an Indian accent answered and inquired as to the reason for my call.

Playing the part of someone who had received the scam call, I told him I’d been alerted about a breach at Apple and that I needed to call this number. After asking me to hold for a brief moment, our call was disconnected.

No doubt this is just another scheme to separate the unwary from their personal and financial details, and to extract some kind of payment (for supposed tech support services or some such). But it is remarkable that Apple’s own devices (or AT&T, which sold her the phone) can’t tell the difference between a call from Apple and someone trying to spoof Apple.

As I noted in my October 2018 piece, Voice Phishing Scams are Getting More Clever, phone phishing usually invokes an element of urgency in a bid to get people to let their guard down. If a call has you worried that there might be something wrong and you wish to call them back, don’t call the number offered to you by the caller. If you want to reach your bank, for example, call the number on the back of your card. If it’s another company you do business with, go to the company’s Web site and look up their main customer support number.

Relying on anything other than a number obtained directly from the company in question — such as a number obtained from a direct search on Google or another search engine — is also extremely risky. In many cases, the scammers are polluting top search engine results with phony 800-numbers for customer support lines that lead directly to fraudsters.

These days, scam calls happen on my mobile so often that I almost never answer my phone unless it appears to come from someone in my contacts list. But as this scam shows, even that’s not always a great strategy.

It’s a good idea to advise your friends and loved ones to ignore calls unless they appear to come from a friend or family member, and most importantly to just hang up the moment the caller starts asking for personal information.

Apple has not yet responded to requests for comment.

from
https://krebsonsecurity.com/2019/01/apple-phone-phishing-scams-getting-better/

Cloud Hosting Provider DataResolution.net Battling Christmas Eve Ransomware Attack

Cloud hosting provider Dataresolution.net is struggling to bring its systems back online after suffering a ransomware infestation on Christmas Eve, KrebsOnSecurity has learned. The company says its systems were hit by the Ryuk ransomware, the same malware strain that crippled printing and delivery operations for multiple major U.S. newspapers over the weekend.

San Juan Capistrano, Calif. based Data Resolution LLC serves some 30,000 businesses worldwide, offering software hosting, business continuity systems, cloud computing and data center services.

The company has not yet responded to requests for comment. But according to a status update shared by Data Resolution with affected customers on Dec. 29, 2018, the attackers broke in through a compromised login account on Christmas Eve and quickly began infecting servers with the Ryuk ransomware strain.

Part of an update on the outage shared with Data Resolution customers via Dropbox on Dec. 29, 2018.

The intrusion gave the attackers control of Data Resolution’s data center domain, briefly locking the company out of its own systems. The update sent to customers states that Data Resolution shut down its network to halt the spread of the infection and to work through the process of cleaning and restoring infected systems.

Data Resolution is assuring customers that there is no indication any data was stolen, and that the purpose of the attack was to extract payment from the company in exchange for a digital key that could be used to quickly unlock access to servers seized by the ransomware.

A snippet of an update that Data Resolution shared with affected customers on Dec. 31, 2018.

The Ryuk ransomware strain was first detailed in an August 2018 report by security firm CheckPoint, which says the malware is tied to a sophisticated North Korean hacking team known as the Lazarus Group.

Ryuk reportedly was the same malware that infected the Los Angeles Times‘ Olympic printing plant over the weekend, an attack that led to the disruption of newspaper printing and delivery services for a number of publications that rely on the plant — including the Los Angeles Times and the San Diego Union Tribune.

A status update shared by Data Resolution with affected customers earlier today indicates the cloud hosting provider is still working to restore email access and multiple databases for clients. The update also said Data Resolution is in the process of restoring service for companies relying on it to host installations of Dynamics GP, a popular software package that many organizations use for accounting and payroll services. 

A status update shared by Data Resolution with affected customers on Jan. 2, 2018 shows the company is still struggling to restore services more than a week after the attack began.

Cloud hosting providers are often pitched as a way for companies to increase security and to better protect themselves from threats like ransomware, which scrambles data on infected systems and demands payment in exchange for a digital key needed to unlock affected systems.

At the same time, cloud providers represent an especially attractive target for ransomware attacks because they store vast amounts of data for other companies. In 2017, cloud hosting provider Cloudnine was hit by a ransomware attack, leading to an outage that lasted for several days.

Much depends on security practices maintained by each provider, according to an MIT Technology Review story last year that named cloud ransomware attacks as a top security concern for 2018

“The biggest cloud operators, like Google, Amazon, and IBM, have hired some of the brightest minds in digital security, so they won’t be easy to crack,” wrote Martin Giles. “But smaller companies are likely to be more vulnerable, and even a modest breach could lead to a big payday for the hackers involved.”

A source at a company that uses Data Resolution to manage payroll payments told KrebsOnSecurity that the cloud hosting provider said it did not attempt to pay the requested ransom, preferring to restore systems from backups instead.

from
https://krebsonsecurity.com/2019/01/cloud-hosting-provider-dataresolution-net-battling-christmas-eve-ransomware-attack/