East European gangs in online protection racket

Eastern European crime syndicates are using threats of computer hacking to extort pay-offs from UK online businesses.

Organised criminals are using distributed denial of service (DDoS) attacks to force online bookmakers, retailers and payment providers into protection rackets, according to the lead story in today's Financial Times. The FT reports that the attacks have cost the companies involved "millions of dollars in lost business" and exposed them to extortion.

Britain's National Hi-Tech Crime Unit (NHTCU) is investigating a case where one betting firm was brought down by an attack prior to receiving a threat that it would be attacked again "unless tens of thousands of pounds were paid", according to the FT. The gang behind the threats are believed to be based in Eastern Europe.

Ian Morris, founder of security integrator Equip Technology, told the FT that it had dealt six such cases.

"Criminals seem to be targeting high-volume low-value transactional sites," he added.

Two years ago we reported on DDoS extortion attempts against three online bookies. Even though the mechanism of the scam has been known about for some time its scale seems to have grown.

The FT reports that a dozen offshore betting sites serving the US market were hit by Distributed Denial of Service attacks and extortion demands in September. Sites were subsequently blackmailed into paying $50,000 a year in return been offered respite from further attacks. Police are urging businesses not to give into such threats, which organisations are urged to report to the authorities, amid indications crooks are turning their attention towards UK businesses.

Detective Superintendent Mick Deats, head of operations at the NHTCU, said: "This is a protection racket. The message to these companies is 'You pay and we leave you alone'.

"If the demand comes in for $40,000-50,000, compared to the losses they're suffering, there's an attraction for the companies to pay and hope it goes away. But there's nothing to say it will go away."

Hackers almost certainly used a network of compromised hosts to launch these assaults. A network of PCs infected with Trojan horse backdoor tools can be remotely directed to packet a targeted online suspect with spurious traffic at the whim of an attacker, drowning out legitimate requests. If these zombified PCs are on a high-speed educational network then so much the better.

Jay Heiser, Chief Analyst at security firm TruSecure, told El Reg that there is little companies can do up front to prevent denial of service attacks being launched against them. However the damage is dependent on how well-prepared an organisation is to fend off assaults.

"When an attack does occur, the victim should contact their ISP immediately to discuss potential configuration changes and mitigation techniques. In many cases, a reasonable level of networking connectivity can be maintained," Heiser said.

"Realistically, law enforcement probably does not have time to become involved in every denial of service attack. Most of these attacks are nuisance attacks, and are not performed by organised criminals. However, if an organisation does receive some sort of blackmail threat, it is a clear indication that a criminal attack is in progress, making it one of interest to the authorities."

WorldPay, the Royal Bank of Scotland online payments service, was subject to a three-day DDoS attack last week. However there is no evidence that it was subject to any blackmail threats. ®

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