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In 2005, Organized Crime Will Back Phishers

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Phishers proved to be the IT security manager’s biggest threat this year.

And analysts say the growth of online organized crime will make it even

worse for 2005.

Analysts also say the security threats IT managers wrestled with in 2004

are morphing into bigger, more damaging, problems for the coming year.

This past year, IT workers have been under the gun more than ever,

fending off more aggressive malware, along with more sophisticated

hackers who are professionals in it for the money, rather than teenagers

looking to show off to their underground hacker friends. IT also has had

to deal with armies of ‘zombie’ machines spewing out millions of pieces

of spam and viruses.

And 2005 promises even more money-driven, professional and menacing

schemes, according to industry analysts.

”In 2005… what we think has been bad so far, could be a whole lot

worse,” says Richard Fleming, chief technology officer and co-founder of

Digital Defense, Inc., a security services firm based in Dallas.

2004: New Online Gangs

This past year proved to be a tough one for IT security administrators

with the birth of phishing and heightened spamming attacks. Driving much

of these fraudulent teams and their scheming was one simple factor: cash.

Many analysts agree that the most damaging theme in security for 2004 was

the deadly combination of social engineering, spam, phishing and viruses

with automated attacks.

Spammers teamed up with phishers this past year and together they created

convincing, sophisticated schemes to steal not only email addresses but

also identities, Social Security numbers and personal financial

information. To help them do this, virus writers and spammers built

armies of zombie machines. First virus authors infected thousands, if not

millions, of computers with viruses and Trojans that opened backdoors,

allowing remote control of the machines. Once they built up enough of

these zombie machines, they then could use them to send out millions of

pieces of spam and more viruses.

”This was a defining year for this combination of the two classes of

threats,” says Gerhard Eschelbeck, chief technology officer and vice

president of engineering at Qualys, Inc., a vulnerability management

services provider based in Redwood Shores, Calif. ”It makes for a very

potent kind of attack.”

In the past, the majority of spam hitting inboxes and clogging mail

servers contained advertisements for things like mortgages, Viagra and

porn. Now, these emails also are carrying viruses, which sometimes infect

computers without users even clicking on attachments. These viruses tend

to go unnoticed by a user, but track a their Internet use, keystrokes and

login passwords.

”Viruses and spam together can be an interesting problem,” says

Fleming. ”Not only are there now more emails with viruses attached, but

now hackers are able to exploit systems using malicious technology.”

When phishing schemes first hit the IT scene in 2003, the fake Web sites

were easier to detect, and the phishers relied mostly on the user to

click on a link or enter their personal information. Now, the game is

more sophisticated. The fake Web sites look authentic, making it easier

for a user to mistake it for a true site.

Another prevalent security theme of the past year was the rapid rate that

viruses and worms spread. Not only did malware work much faster, these

worms also infected new machines, such as mobile phones and Instant

Messenger software. These technologies hadn’t yet experienced much in the

line of virus attacks, and analysts worry that security managers are not

prepared for it.

”Mobility drives security exposure,” says Andre Yee, president and

chief executive officer of NFR Security, the Rockville, Md.-based

provider of intrusion prevention systems. ”Security managers are

scrambling to catch up with this threat.”

Analysts agree that the majority of these threats — whether to

handhelds, IM or ordinary desktops — are increasing in maliciousness.

And it’s largely because virus authors now are being egged on not just by

their hacker friends, but by money.

”The whole threat environment is changing,” says Timothy Keanini, chief

technology officer of nCircle, a San Francisco, Calif.-based

enterpriseclass vulnerability management firm. ”We are seeing more and

more organized threats. The code, tactics and frameworks look like some

of the best software designers’ work, but it’s actually the bad guys. It

is all more efficient and has much more reuse.”

The prospect of financial gain for hackers results in a scary situation

for users, says Steve Sundermeier, vice president of products and

services of Central Command, Inc., an anti-virus company based in Medina,

Ohio. Viruses and worms proliferate at greater speeds than ever before

and are much harder to detect.

”The dreaded result used to be a hard drive crash, but now people’s

livelihood is at stake,” Sundermeier says.

Continue on to see what analysts are predicting for next year’s top security threats…

2005: The Coming Threat

If it’s true that money is the root of all evil, 2005’s forecast is


”Organized crime will definitely be a factor in 2005,” Sundermeier

says. ”If you know that you can turn a quick buck by gathering Gram and

Pa’s email address and information, why not continue on the same path?”

Analysts concur that phishers will continue to team up with spammers and

virus writers next year, and their work will mature even more.

”There will be an evolution in the content and in the way that a message

is sent so it evades filters and fools recipients,” says Andrew Lochart,

director of product marketing at Postini, an email security and

management solutions company out of Redwood City, Calif. ”This can be a

lucrative business. It is a temptation for certain people to keep on


The coming year will not see the end of this type of organized crime.

”Over the next four or five years, organized crime is going to become

more rampant on the Internet,” Fleming says. ”It is already huge, and

virus writers will continue to be paid.”

With big cash prizes behind every virus, analysts warn that anti-virus

programs may reach their limits, and that the window between when a

system’s vulnerability is exposed and when a virus is implemented will

reduce dramatically. The zero-day exploit is coming into play.

Analysts warn all IT managers and users alike that the only way to combat

these money-driven threats in 2005 is with increased awareness and

proactive approaches.

What analysts are calling for is increased awareness and proactive


And part of this proactive response, analysts say, is a change in the

manner of prosecution for these crimes. There are great barriers to

related legislation and law enforcement, since the offenders are spread

from state to state, and around the globe.

”Courts are getting smarter in how to legislate Internet crimes,”

Fleming says. ”Because now it is a global problem so who’s law applies?

[The courts] are slowing trying to take into account the cultural, legal

and fundamental differences.”

The only way to effectively fight the threats of 2005 is to be aware and

aggressive, analysts say.

”You have to be expecting you will be attacked,” Fleming says. ”You

must learn to be Internet-wise.”

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