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[ISN] 'Pump-and-Dump' Spam Surge Linked to Russian Bot Herders
From: InfoSec News (alertsinfosecnews.org)
Date: Fri Nov 17 2006 - 04:10:40 CST
By Ryan Naraine
November 16, 2006
The recent surge in e-mail spam hawking penny stocks and penis
enlargement pills is the handiwork of Russian hackers running a botnet
powered by tens of thousands of hijacked computers.
Internet security researchers and law enforcement authorities have
traced the operation to a well-organized hacking gang controlling a
70,000-strong peer-to-peer botnet seeded with the SpamThru Trojan.
According to Joe Stewart, senior security researcher at SecureWorks, in
Atlanta, the gang functions with a level of sophistication rarely seen
in the hacking underworld.
For starters, the Trojan comes with its own anti-virus scannera pirated
copy of Kaspersky's security softwarethat removes competing malware
files from the hijacked machine. Once a Windows machine is infected, it
becomes a peer in a peer-to-peer botnet controlled by a central server.
If the control server is disabled by botnet hunters, the spammer simply
has to control a single peer to retain control of all the bots and send
instructions on the location of a new control server.
The bots are segmented into different server ports, determined by the
variant of the Trojan installed, and further segmented into peer groups
of no more than 512 bots. This allows the hackers to keep the overhead
involved in exchanging information about other peers to a minimum,
Stewart, a reverse engineering expert with expertise in deconstructing
malware samples, gained access to files from a SpamThru control server
and found evidence that the attackers are meticulous about keeping
statistics on bot infections around the world.
For example, the SpamThru controller keeps statistics on the country of
origin of all bots in the botnet. In all, computers in 166 countries are
part of the botnet, with the United States accounting for more than half
of the infections.
The botnet stats tracker even logs the version of Windows the infected
client is running, down to the service pack level. One chart
commandeered by Stewart showed that Windows XP SP2 (Service Pack 2)
machines dominate the makeup of the botnet, a clear sign that the latest
version of Microsoft's operating system is falling prey to attacks.
Another sign of the complexity of the operation, Stewart found, was a
database hacking component that signaled the ability of the spammers to
target its pump-and-dump scams to victims most likely to be associated
with stock trading.
Stewart said about 20 small investment and financial news sites have
been breached for the express purpose of downloading user databases with
e-mail addresses matched to names and other site registration data. On
the bot herder's control server, Stewart found a MySQL database dump of
e-mail addresses associated with an online shop.
"They're breaking into sites that are somewhat related to the stock
market and stealing e-mail address from those databases. The thinking
is, if they get an e-mail address for someone reading stock market and
investment news, that's a perfect target for these penny stock scams,"
Stewart said in an interview with eWEEK.
The SpamThru spammer also controls lists of millions of e-mail addresses
harvested from the hard drives of computers already in the botnet. "This
gives the spammer the ability to reach individuals who have never
published their e-mail address online or given it to anyone other than
personal contacts," Stewart explained.
"It's a very enterprising operation and it's interesting that they're
only doing pump-and-dump and penis enlargement spam. That's probably
because those are the most lucrative," he added.
Even the spam messages come with a unique component. The messages are
both text- and image-based and a lot of effort has been put into evading
spam filters. For example, each SpamThru client works as its own spam
engine, downloading a template containing the spam and random phrases to
use as hash-busters, random "from" names, and a list of several hundred
e-mail addresses to send to.
Stewart discovered that the image files in the templates are modified
with every e-mail message sent, allowing the spammer to change the width
and height. The image-based spam also includes random pixels at the
bottom, specifically to defeat anti-spam technologies that reject mail
based on a static image.
All SpamThru botsthe botnet controls about 73,000 infected clientsare
also capable of using a list of proxy servers maintained by the
controller to evade blacklisting of the bot IP addresses by anti-spam
services. Stewart said this allows the Trojan to act as a "massive
distributed engine for sending spam," without the cost of maintaining
With a botnet of this size, the group is theoretically capable of
sending a billion spam e-mails in a single day. "This number assumes one
recipient per message, [but] in reality, most spams are delivered in a
single message with multiple recipients at the same domain, so the
actual number of separate spams landing in different inboxes could be
even higher," Stewart said.
According to data from Barracuda Networks, an enterprise security
appliance vendor in Mountain View, Calif., there has been a 67 percent
increase in overall spam volume and a 500 percent increase in image spam
since Aug. 2006.
Stephen Pao, vice president of product management at Barracuda Networks,
echoed Stewart's findings, noting that the bulk of the spam is linked to
the trading of penny stocks. "Across the board, we are observing more
spam and more sophistication in sending the spam," Pao said.
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