Web Fraud 2.0

The Great $50M African IP Address Heist

A top executive at the nonprofit entity responsible for doling out chunks of Internet addresses to businesses and other organizations in Africa has resigned his post following accusations that he secretly operated several companies which sold tens of millions of dollars worth of the increasingly scarce resource to online marketers. The allegations stemmed from a three-year investigation by a U.S.-based researcher whose findings shed light on a murky area of Internet governance that is all too often exploited by spammers and scammers alike.

There are fewer than four billion so-called “Internet Protocol version 4” or IPv4 addresses available for use, but the vast majority of them have already been allocated. The global dearth of available IP addresses has turned them into a commodity wherein each IP can fetch between $15-$25 on the open market. This has led to boom times for those engaged in the acquisition and sale of IP address blocks, but it has likewise emboldened those who specialize in absconding with and spamming from dormant IP address blocks without permission from the rightful owners.

Perhaps the most dogged chronicler of this trend is California-based freelance researcher Ron Guilmette, who since 2016 has been tracking several large swaths of IP address blocks set aside for use by African entities that somehow found their way into the hands of Internet marketing firms based in other continents.

Over the course of his investigation, Guilmette unearthed records showing many of these IP addresses were quietly commandeered from African businesses that are no longer in existence or that were years ago acquired by other firms. Guilmette estimates the current market value of the purloined IPs he’s documented in this case exceeds USD $50 million.

In collaboration with journalists based in South Africa, Guilmette discovered tens of thousands of these wayward IP addresses that appear to have been sold off by a handful of companies founded by the policy coordinator for The African Network Information Centre (AFRINIC), one of the world’s five regional Internet registries which handles IP address allocations for Africa and the Indian Ocean region.

That individual — Ernest Byaruhanga — was only the second person hired at AFRINIC back in 2004. Byaruhanga did not respond to requests for comment. However, he abruptly resigned from his position in October 2019 shortly after news of the IP address scheme was first detailed by Jan Vermeulen, a reporter for the South African tech news publication Mybroadband.co.za who assisted Guilmette in his research.

KrebsOnSecurity sought comment from AFRINIC’s new CEO Eddy Kayihura, who said the organization was aware of the allegations and is currently conducting an investigation into the matter.

“Since the investigation is ongoing, you will understand that we prefer to complete it before we make a public statement,” Kayihura said. “Mr. Byauhanga’s resignation letter did not mention specific reasons, though no one would be blamed to think the two events are related.”

Guilmette said the first clue he found suggesting someone at AFRINIC may have been involved came after he located records suggesting that official AFRINIC documents had been altered to change the ownership of IP address blocks once assigned to Infoplan (now Network and Information Technology Ltd), a South African company that was folded into the State IT Agency in 1998.

“This guy was shoveling IP addresses out the backdoor and selling them on the streets,” said Guilmette, who’s been posting evidence of his findings for years to public discussion lists on Internet governance. “To say that he had an evident conflict of interest would be a gross understatement.”

For example, documents obtained from the government of Uganda by Guilmette and others show Byaruhanga registered a private company called ipv4leasing after joining AFRINIC. Historic WHOIS records from domaintools.com [a former advertiser on this site] indicate Byaruhanga was the registrant of two domain names tied to this company — ipv4leasing.org and .net — back in 2013.

Guilmette and his journalist contacts in South Africa uncovered many instances of other companies tied to Byaruhanga and his immediate family members that appear to have been secretly selling AFRINIC IP address blocks to just about anyone willing to pay the asking price. But the activities of ipv4leasing are worth a closer look because they demonstrate how this type of shadowy commerce is critical to operations of spammers and scammers, who are constantly sullying swaths of IP addresses and seeking new ones to keep their operations afloat.

Historic AFRINIC record lookups show ipv4leasing.org tied to at least six sizable blocks of IP addresses that once belonged to a now defunct company from Cameroon called ITC that also did business as “Afriq*Access.”

In 2013, Anti-spam group Spamhaus.org began tracking floods of junk email originating from this block of IPs that once belonged to Afriq*Access. Spamhaus says it ultimately traced the domains advertised in those spam emails back to Adconion Direct, a U.S. based email marketing company that employs several executives who are now facing federal criminal charges for allegedly paying others to hijack large ranges of IP addresses used in wide-ranging spam campaigns.

Bill Woodcock is executive director of Packet Clearing House, a non-profit research institute dedicated to understanding and supporting Internet traffic exchange technology, policy, and economics. Woodcock said it’s not unheard of for employees at regional Internet registries (RIRs) to get caught selling off IP addresses as a side hustle, but that this case is by far the longest-running alleged scheme to date.

“It’s not unprecedented in the sense that there have been insider deals in the past done illicitly by employees of other RIRs,” he said. “But typically they’ve been one-off or short-lived before getting caught or fired.”

Anyone interested in a deeper dive on Guilmette’s years-long investigation — including the various IP address blocks in question — should check out MyBroadband’s detailed Dec. 4 story, How Internet Resources Worth R800 Million (USD $54M) Were Stolen and Sold on the Black Market.

It’s Way Too Easy to Get a .gov Domain Name

Technical Security Assessment

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NCR Barred Mint, QuickBooks from Banking Platform During Account Takeover Storm

Banking industry giant NCR Corp. [NYSE: NCR] late last month took the unusual step of temporarily blocking third-party financial data aggregators Mint and QuickBooks Online from accessing Digital Insight, an online banking platform used by hundreds of financial institutions. That ban, which came in response to a series of bank account takeovers in which cybercriminals used aggregation sites to surveil and drain consumer accounts, has since been rescinded. But the incident raises fresh questions about the proper role of digital banking platforms in fighting password abuse.

Part of a communication NCR sent Oct. 25 to banks on its Digital Insight online banking platform.

On Oct. 29, KrebsOnSecurity heard from a chief security officer at a U.S.-based credit union and Digital Insight customer who said his institution just had several dozen customer accounts hacked over the previous week.

My banking source said the attackers appeared to automate the unauthorized logins, which took place over a week in several distinct 12-hour periods in which a new account was accessed every five to ten minutes.

Most concerning, the source said, was that in many cases the aggregator service did not pass through prompts sent by the credit union’s site for multi-factor authentication, meaning the attackers could access customer accounts with nothing more than a username and password.

“The weird part is sometimes the attackers are getting the multi-factor challenge, and sometimes they aren’t,” said the source, who added that he suspected a breach at Mint and/QuickBooks because NCR had just blocked the two companies from accessing bank Web sites on its platform.

In a statement provided to KrebsOnSecurity, NCR said that on Friday, Oct. 25, the company notified Digital Insight customers “that the aggregation capabilities of certain third-party product were being temporarily suspended.”

“The notification was sent while we investigated a report involving a single user and a third-party product that aggregates bank data,” reads their statement, which was sent to customers on Oct. 29. After confirming that the incident was contained, NCR restored connectivity that is used for account aggregation. “As we noted, the criminals are getting aggressive and creative in accessing tools to access online information, NCR continues to evaluate and proactively defend against these activities.””

What were these sophisticated methods? NCR wouldn’t say, but it seems clear the hacked accounts are tied to customers re-using their online banking passwords at other sites that got hacked.

As I noted earlier this year in The Risk of Weak Online Banking Passwords, if you bank online and choose weak or re-used passwords, there’s a decent chance your account could be pilfered by cyberthieves — even if your bank offers multi-factor authentication as part of its login process.

Crooks are constantly probing bank Web sites for customer accounts protected by weak or recycled passwords. Most often, the attacker will use lists of email addresses and passwords stolen en masse from hacked sites and then try those same credentials to see if they permit online access to accounts at a range of banks.

A screenshot of a password-checking tool that can be used to target Chase Bank customers who re-use passwords. There are tools like this one for just about every other major U.S. bank.

From there, thieves can take the list of successful logins and feed them into apps that rely on application programming interfaces (API)s from one of several personal financial data aggregators, including Mint, Plaid, QuickBooks, Yodlee, and YNAB.

A number of banks that do offer customers multi-factor authentication — such as a one-time code sent via text message or an app — have chosen to allow these aggregators the ability to view balances and recent transactions without requiring that the aggregator service supply that second factor.

If the thieves are able to access a bank account via an aggregator service or API, they can view the customer’s balance(s) and decide which customers are worthy of further targeting.

But beyond targeting customers for outright account takeovers, the data available via financial aggregators enables a far more insidious type of fraud: The ability to link the target’s bank account(s) to other accounts that the attackers control.

That’s because PayPalZelle, and a number of other pure-play online financial institutions allow customers to link accounts by verifying the value of microdeposits. For example, if you wish to be able to transfer funds between PayPal and a bank account, the company will first send a couple of tiny deposits  — a few cents, usually — to the account you wish to link. Only after verifying those exact amounts will the account-linking request be granted.

The temporary blocking of data aggregators by NCR brings up a point worthy of discussion by regulators: Namely, in the absence of additional security measures put in place by the aggregators, do the digital banking platform providers like NCR, Fiserv, Jack Henry, and FIS have an obligation to help block or mitigate these large-scale credential exploitation attacks?

KrebsOnSecurity would argue they do, and that the crooks who attacked the customers of my source’s credit union have probably already moved on to using the same attack against one of several thousand other dinky banks across the country.

Intuit Inc., which owns both Mint and QuickBooks, has not responded to requests for comment.

NCR declined to discuss specifics about how it plans to respond to similar attacks going forward.

“BriansClub” Hack Rescues 26M Stolen Cards

BriansClub,” one of the largest underground stores for buying stolen credit card data, has itself been hacked. The data stolen from BriansClub encompasses more than 26 million credit and debit card records taken from hacked online and brick-and-mortar retailers over the past four years, including almost eight million records uploaded to the shop in 2019 alone.

An ad for BriansClub has been using my name and likeness for years to peddle millions of stolen credit cards.

Last month, KrebsOnSecurity was contacted by a source who shared a plain text file containing what was claimed to be the full database of cards for sale both currently and historically through BriansClub[.]at, a thriving fraud bazaar named after this author. Imitating my site, likeness and namesake, BriansClub even dubiously claims a copyright with a reference at the bottom of each page: “© 2019 Crabs on Security.”

Multiple people who reviewed the database shared by my source confirmed that the same credit card records also could be found in a more redacted form simply by searching the BriansClub Web site with a valid, properly-funded account.

All of the card data stolen from BriansClub was shared with multiple sources who work closely with financial institutions to identify and monitor or reissue cards that show up for sale in the cybercrime underground.

The leaked data shows that in 2015, BriansClub added just 1.7 million card records for sale. But business would pick up in each of the years that followed: In 2016, BriansClub uploaded 2.89 million stolen cards; 2017 saw some 4.9 million cards added; 2018 brought in 9.2 million more.

Between January and August 2019 (when this database snapshot was apparently taken), BriansClub added roughly 7.6 million cards.

Most of what’s on offer at BriansClub are “dumps,” strings of ones and zeros that — when encoded onto anything with a magnetic stripe the size of a credit card — can be used by thieves to purchase electronics, gift cards and other high-priced items at big box stores.

As shown in the table below (taken from this story), many federal hacking prosecutions involving stolen credit cards will for sentencing purposes value each stolen card record at $500, which is intended to represent the average loss per compromised cardholder.

The black market value, impact to consumers and banks, and liability associated with different types of card fraud.

STOLEN BACK FAIR AND SQUARE

An extensive analysis of the database indicates BriansClub holds approximately $414 million worth of stolen credit cards for sale, based on the pricing tiers listed on the site. That’s according to an analysis by Flashpoint, a security intelligence firm based in New York City.

Allison Nixon, the company’s director of security research, said the data suggests that between 2015 and August 2019, BriansClub sold roughly 9.1 million stolen credit cards, earning the site $126 million in sales (all sales are transacted in bitcoin).

If we take just the 9.1 million cards that were confirmed sold through BriansClub, we’re talking about more than $4 billion in likely losses at the $500 average loss per card figure from the Justice Department.

Also, it seems likely the total number of stolen credit cards for sale on BriansClub and related sites vastly exceeds the number of criminals who will buy such data. Shame on them for not investing more in marketing!

There’s no easy way to tell how many of the 26 million or so cards for sale at BriansClub are still valid, but the closest approximation of that — how many unsold cards have expiration dates in the future — indicates more than 14 million of them could still be valid.

The archive also reveals the proprietor(s) of BriansClub frequently uploaded new batches of stolen cards — some just a few thousand records, and others tens of thousands.

That’s because like many other carding sites, BriansClub mostly resells cards stolen by other cybercriminals — known as resellers or affiliates — who earn a percentage from each sale. It’s not yet clear how that revenue is shared in this case, but perhaps this information will be revealed in further analysis of the purloined database.

BRIANS CHAT

In a message titled “Your site is hacked,’ KrebsOnSecurity requested comment from BriansClub via the “Support Tickets” page on the carding shop’s site, informing its operators that all of their card data had been shared with the card-issuing banks.

I was surprised and delighted to receive a polite reply a few hours later from the site’s administrator (“admin”):

“No. I’m the real Brian Krebs here 🙂

Correct subject would be the data center was hacked.

Will get in touch with you on jabber. Should I mention that all information affected by the data-center breach has been since taken off sales, so no worries about the issuing banks.”

Flashpoint’s Nixon said a spot check comparison between the stolen card database and the card data advertised at BriansClub suggests the administrator is not being truthful in his claims of having removed the leaked stolen card data from his online shop.

The admin hasn’t yet responded to follow-up questions, such as why BriansClub chose to use my name and likeness to peddle millions of stolen credit cards.

Almost certainly, at least part of the appeal is that my surname means “crab” (or cancer), and crab is Russian hacker slang for “carder,” a person who engages in credit card fraud.

Many of the cards for sale on BriansClub are not visible to all customers. Those who wish to see the “best” cards in the shop need to maintain certain minimum balances, as shown in this screenshot.

HACKING BACK?

Nixon said breaches of criminal website databases often lead not just to prevented cybercrimes, but also to arrests and prosecutions.

“When people talk about ‘hacking back,’ they’re talking about stuff like this,” Nixon said. “As long as our government is hacking into all these foreign government resources, they should be hacking into these carding sites as well. There’s a lot of attention being paid to this data now and people are remediating and working on it.”

By way of example on hacking back, she pointed to the 2016 breach of vDOS — at the time the largest and most powerful service for knocking Web sites offline in large-scale cyberattacks.

Soon after vDOS’s database was stolen and leaked to this author, its two main proprietors were arrested. Also, the database added to evidence of criminal activity for several other individuals who were persons of interest in unrelated cybercrime investigations, Nixon said.

“When vDOS got breached, that basically reopened cases that were cold because [the leak of the vDOS database] supplied the final piece of evidence needed,” she said.

THE TARGET BREACH OF THE UNDERGROUND?

After many hours spent poring over this data, it became clear I needed some perspective on the scope and impact of this breach. As a major event in the cybercrime underground, was it somehow the reverse analog of the Target breach — which negatively impacted tens of millions of consumers and greatly enriched a large number of bad guys? Or was it more prosaic, like a Jimmy Johns-sized debacle?

For that insight, I spoke with Gemini Advisory, a New York-based company that works with financial institutions to monitor dozens of underground markets trafficking in stolen card data.

Andrei Barysevich, co-founder and CEO at Gemini, said the breach at BriansClub is certainly significant, given that Gemini currently tracks a total of 87 million credit and debit card records for sale across the cybercrime underground.

Gemini is monitoring most underground stores that peddle stolen card data — including such heavy hitters as Joker’s StashTrump’s Dumps, and BriansDump.

Contrary to popular belief, when these shops sell a stolen credit card record, that record is then removed from the inventory of items for sale. This allows companies like Gemini to determine roughly how many new cards are put up for sale and how many have sold.

Barysevich said the loss of so many valid cards may well impact how other carding stores compete and price their products.

“With over 78% of the illicit trade of stolen cards attributed to only a dozen of dark web markets, a breach of this magnitude will undoubtedly disturb the underground trade in the short term,” he said. “However, since the demand for stolen credit cards is on the rise, other vendors will undoubtedly attempt to capitalize on the disappearance of the top player.”

Liked this story and want to learn more about how carding shops operate? Check out Peek Inside a Professional Carding Shop.