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FBI says new phone scam targets your bank account

Jorgen Wouters
Jun 21st 2010 at 5:00PM MoreText SizeAAAFiled under: Technology, Fraud, Consumer Ally

The FBI is warning consumers to be on the alert for scammers who tie up their phone lines while emptying their bank accounts.

These "telephone denial-of-service" attacks are similar to ones that have been used by hackers for years to crash websites by flooding them with Internet traffic. But high-tech criminals are now using automated dialing programs and multiple accounts to overwhelm the phone lines of unsuspecting consumers and small- and medium-sized businesses.

The denial-of-service calls, which can include dead air, advertisements or phone gidget menus, are actually diversionary tactics designed to tie up a victim's phone lines. And while the lines are busy, the fraudsters -- impersonating the victims -- raid their bank accounts, online trading and other money management accounts.

The FBI first learned about this scheme through one of its private industry partners, which told the agency of a Florida dentist who lost $400,000 from his retirement account after a denial-of-service attack on his phones. So how does this "dialing for dollars" scam work?

Weeks or even months before the phone calls start, the FBI warns, a criminal uses social engineering tactics
or malware to extract personal information such as passwords an account numbers from intended victims. These victims may have set set themselves up by replying to phishing e-mails, inadvertently giving out sensitive information during a bogus phone call, or placing too personal information on social networking sites, which are constantly trolled by cyber criminals. Once the scam artists have enough information, they tie up the victim's various phone lines and either contact a financial institution pretending to be the victim or siphon off funds from their online bank accounts.

Financial institutions typically call to verify such transactions, but can't get through due to the denial-of-service attack. If the transactions aren't approved, the criminals will contact the financial institution, pose as the victim and confirm the transactions. They can also add their own phone number to victims' accounts, and simply wait for the bank to call and request approval. By the time the victim or financial institution realizes what has happened, it's too late.

The FBI reports a surge in telephone denial-of-service attacks since April of this year, with reports of numerous incidents in several Eastern states.The FBI has teamed up with the Communication Fraud Control Association -- a collection comprised of security professionals from communication providers -- to educate the public, analyze patterns and trends of telephone denial-of-service attacks, and identify the con artists and bring them to justice.

The FBI urges consumers and small- and medium-sized business to take the following steps to avoid being a victim of this new scam:
Never give out personal information to an unsolicited phone caller or via e-mail
Change online banking and automated telephone system passwords frequently
Check your account balances often
Protect your computers with the latest virus protection and security software.
If you think you may have been targeted by a telephone denial-of-service attack, contact your financial institution and your telephone provider, and file a complaint with the FBI's Internet Crime Complaint Center.

http://www.walletpop.com/blog/2010/06/21/fbi-says-new-phone-scam-targets-your-bank-account/?icid=main

[Abe]

Press Release
For Immediate Release
July 28, 2010

Washington D.C.
FBI National Press Office
(202) 324-3691

FBI, Slovenian and Spanish Police Arrests Mariposa Botnet Creator, Operators

The FBI, in partnership with the Slovenian Criminal Police and the Spanish Guardia Civil, announced today significant developments in a two-year investigation of the creator and operators of the Mariposa Botnet. A botnet is a network of remote-controlled compromised computers.

The Mariposa Botnet was built with a computer virus known as “Butterfly Bot” and was used to steal passwords for websites and financial institutions. It stole computer users’ credit card and bank account information, launched denial of service attacks, and spread viruses. Industry experts estimated the Mariposa Botnet may have infected as many as 8 million to 12 million computers.

“In the last two years, the software used to create the Mariposa botnet was sold to hundreds of other criminals, making it one of the most notorious in the world,” said FBI Director Robert S. Mueller, III. “These cyber intrusions, thefts, and frauds undermine the integrity of the Internet and the businesses that rely on it; they also threaten the privacy and pocketbooks of all who use the Internet.”

In February, the Spanish Guardia Civil arrested three suspected Mariposa Botnet operators: “Netkairo,” “Jonyloleante,” and “Ostiator,” aka Florencio Carro Ruiz, Jonathan Pazos Rivera, and Juan Jose Bellido Rios. These individuals are being prosecuted in Spain for computer crimes.

Last week, the Slovenian Criminal Police identified and arrested the Mariposa Botnet’s suspected creator, a 23-year-old Slovenian citizen known as “Iserdo.” The work of the Slovenian and Spanish authorities was integral to this investigation.

FBI Cyber Division Assistant Director Gordon M. Snow said: “This case shows the value of strong partnerships among law enforcement agencies worldwide in the fight against cyber criminals. Cyber crime knows no boundaries, and without international collaboration, our efforts to dismantle these operations would be impossible. The FBI praises the work of our Slovenian and Spanish partners who worked closely with our agents in this case.”

In a statement, Slovenian Minister of the Interior Katarina Kresal and Director General Janko Gorsek, Slovenian Criminal Police, said: “We are glad to cooperate with the United States; the FBI’s assistance is invaluable and represents professional affirmation of our force. This case shows that cyber crime issues call for international police cooperation that shouldn’t be hindered by geographical borders. The FBI has demonstrated a high level of collaboration in which our countries were equal partners, which was crucial for the success of the investigation and reducing the threat on a global level. This partnership serves as a solid basis for future cooperation.”

Maj. Juan Salom, commander of the Guardia Civil’s Cyber Crime Division, noted: “The Mariposa case showed how the coordinated and joint actions of different international police forces, along with the efforts of the Internet security industry, have been able to face the global threat of cyber crime,” he said. “The cyber kingpins know that they are not invincible anymore because the global efforts of the FBI, Slovenian Criminal Police, and Spanish Guardia Civil have shown that it doesn’t matter where or how they try to hide, they will be located and prosecuted.”

From 2008 to 2010, the Slovenian citizen created “Butterfly Bot” and sold it to other criminals worldwide. In turn, these criminals developed networks of infected computers—botnets—and the Mariposa variety from Spain was the most notorious and largest. In addition to selling the Butterfly Bot program, the Slovenian citizen developed customized versions for certain customers and created and sold plug-ins (add-ons) to augment the botnet’s features and functionality.

This case is significant because it targeted not only the operators of the botnet but also the creator of the malicious software that was used to build and operate it. The success of this investigation was made possible because of the skill, professionalism, and commitment of the Slovenian Criminal Police’s Cyber Crime Division and the Spanish Guardia Civil’s Computer Crimes Group.

The FBI conducted this investigation with the assistance of the United States Attorney’s Office, District of Hawaii, and the Department of Justice’s Computer Crime and Intellectual Property Section, Office of International Affairs, and the Botnet Threat Focus Cell. The FBI also received invaluable assistance from the Mariposa Working Group.

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