FBI, FTC Take Down Scammers & Spammers
I was traveling to speak at a couple of conferences most of the past week, so I missed out on covering some of the bigger cyber-security justice developments to come in a long while: The FBI announced it has busted up an online bazaar for cyber thieves, working with international authorities to nab at least 56 people suspected of buying and selling stolen personal and financial data. In other news, the Federal Trade Commission convinced a judge to freeze the assets of what's being called the world's largest spam gang.
The FBI said the arrests came after investigators infiltrated DarkMarket.ws, a Web forum for cyber crooks that once boasted more than 2,500 members who were interested in buying and selling credit card data, stolen user names and passwords.
"What they didn't know was that one of the site's administrators and most respected members, who called himself Master Splyntr, was one of us -- an undercover FBI agent who had infiltrated the site posing as a cyber crook," the FBI said of forum members, in a statement.
The undercover agent said he saw millions of dollars worth of stolen goods being exchanged on DarkMarket. The bureau estimates that the bust prevented more than $70 million in potential losses.
Wired.com's Kevin Poulsen has an interesting back story on this undercover operation, which was apparently almost blown two years ago when a rival forum operator fingered Master Splyntr as an undercover fed.
In a separate action, the FTC said a federal court had frozen the assets of an international spam ring (PDF) that pushed male-enhancement pills and knockoff prescription drugs.
The FTC said the online pharmacies lied about the safety of their drugs and the security of their Web site (the sites said they were using https:// when they weren't), and that they spoofed the source of the spam, most of which was sent using one of the world's largest botnets. The commission said it received more than three million complaints about spam messages connected to this junk e-mail operation.
The agency's complaint names two individuals -- Lance Atkinson, a New Zealand citizen living in Australia, and Jody Smith of Texas - and four companies they control: Inet Ventures Pty Ltd., Tango Pay Inc., Click Fusion Inc., and TwoBucks Trading Limited. Atkinson already has a rap sheet for spamming: In June 2005, the FTC obtained a $2.2 million judgment against Atkinson and another business partner for running a similar spam affiliate program that marketed herbal products.
In supplemental documents filed by the FTC, the commission alleges that Atkinson and Smith's operations generated sales of more than $500,000 monthly. Earlier this year, security company Marshal Software identified the source of the spam e-mails as the "Mega-D" botnet, which it estimated was made up of 35,000 compromised PCs and at one point was responsible for sending 32 percent of all spam.
It's not clear yet whether the enforcement actions have stemmed the tide of pill spam blasted out through Mega-D. But Joe Stewart, a senior security researcher for Atlanta-based SecureWorks, said much of the pill spam sent via Mega-D has since been replaced by junk e-mail touting Russian brides and other online dating scams.
Update, 9:44 a.m.: Speaking of spam: In an effort to cut back on the amount of spam in blog comments, washingtonpost.com is instituting a site-wide change that requires those who wish to comment to have registered on the site. No doubt, this change will discourage some readers who do not wish to go through the free registration process, and that's unfortunate. But a series of comment-spam attacks across all blogs have caused serious and unacceptable slowdowns for the site as a whole.
October 22, 2008; 8:30 AM ET
Categories: Cyber Justice , U.S. Government , Web Fraud 2.0
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