Security holes in Android and iPhone apps from PayPal, Bank of America, Chase, Wells Fargo, and more could give attackers access to financial data.

By Mathew J. Schwartz
Nov. 5, 2010

Smartphone banking applications from Bank of America, Chase, PayPal, TD Ameritrade, USAA, Wells Fargo, and Vanguard have bugs which an attacker could exploit to steal people’s personal financial information. So said digital forensics firm viaForensics in a security warning released Thursday.

“We encountered a surprising and increasing amount of highly sensitive financial and identity information on smart phones,” said Andrew Hoog, CIO of viaForensics. “This information, uncovered on both Apple iPhones and Google Android devices, would only benefit cyber criminals and identity thieves. While Google and Apple each approach the app review process differently, neither approach has prevented insecure applications from being installed.”

Hoog said that his company began “communicating and coordinating with the financial institutions to eliminate the flaws” on Monday, and that the vulnerability announcement reflects how the applications performed as of Wednesday. “Since that time, several of the institutions have released new versions and we will post updated findings shortly.”

Major vulnerabilities encountered included some applications failing to validate security certificates, leaving them vulnerable to man-in-the-middle attacks. Such attacks could recover “full user name, password, and account data,” said Hoog. Other applications failed to encrypt transmitted passwords, sending them as clear text. Others inappropriately “saved your data to the Smartphone, allowing recovery of all financial information viewed in the application.”

One organization that moved to quickly retool its mobile application was PayPal, a division of eBay. On Thursday, PayPal spokeswoman Amanda Pires told the Wall Street Journal that PayPal had submitted a new version of its application to the Apple App Store for review on Tuesday evening, and that there was no evidence of attackers having exploited the vulnerability. “To my knowledge it has not affected anybody,” she said. PayPal also said it would fully reimburse anyone who lost money as a result of the vulnerability. The affected PayPal application had been downloaded 4 million times.

The bug disclosure comes on the heels of PayPal’s announcement last week that it expects to process more than $700 million in mobile payments by the end of the year.

Original Article

Computer Clarity

By Daily Mail Reporter
Last updated at 2:11 PM on 11th August 2010

• Trojan is still at large and may strike again, experts warn
• Bank affected has still not been named

Thousands of British online banking customers have fallen victim to a sophisticated attack by cyber criminals who have stolen thousands of pounds from their accounts.

About 3,000 online banking customers have been victims of a computer virus attack that empties their accounts while showing them fake statements so the scam goes undetected.

Experts have described the attack using a ‘Trojan’ virus as the most sophisticated and dangerous malware program ever created.

The cyber criminals stole an estimated £675,000 between July 5 and August 4 and the attack is still progressing, experts warn.

Out of action: The new Trojan virus can empty bank accounts without their owners knowing about the theft as it shows them fake statements

The latest virus is a variant of the Zeus Trojan banking virus which first emerged three years ago and is called Zeus v3. 

M86 Security said: ‘We’ve never seen such a sophisticated and dangerous threat. Always check your balance and have a good idea of what it is.’

The scam was discovered after M86 gained access to the command-and-control server in Eastern Europe running the thefts.

How to protect yourself from Trojans when banking online

• Make sure your anti-virus software is up to date.
• Keep firewalls set to the highest level.
• Never open an e-mail attachment from someone you don’t know.
• Never double-click on an e-mail attachment that ends in .exe. It is an ‘executable’ file and can do what it likes in your system.
• If you think your machine has already been infected, contact your bank immediately. If the bank thinks you are a genuine victim of fraud it will reimburse you.

It collects data such as passwords and even transfers money out of accounts automatically, but only after checking if there is at least £800 available.

Bradley Anstis, M86 vice-president of technology strategy, said: ‘This is an extremely sophisticated version of the virus and it cannot be detected by traditional security software.’

The company said it was the most-sophisticated and dangerous virus yet seen and advised online banking users to check their balances regularly and have a good idea of what it should be. 

British high street banks do not believe they have become victims of the cyber criminals.

A spokesman for HSBC said: ‘There are millions of viruses and other malicious software.

We urge people to take basic measure to protect themselves from virus attacks.

Any customer who is a victim of fraud will be reimbursed by HSBC.’

However, M86 said it believed one high street bank was breached and failed to act quickly after warnings last month.

More than 100,000 PCs in Britain have been infected with other forms of the Trojan virus.

McAfee Inc, the security software maker, said production of software code known as malware, which can harm computers and steal user passwords, reached a new high in the first six months of 2010.

McAfee said total malware production continued to soar and 10 million new pieces of malicious code were catalogued.

What is a Trojan?

• A Trojan is a type of computer virus that infects your PC
• It is called a Trojan because it will disguise itself as a useful application but when installed can take control of a user’s computer
• It can let a hacker take control of your computer or simply wipe the hard drive
• It can also be used to install key logging software which will let the hacker know what you are typing and give him access  to your passwords
• Trojans are now the most popular form of computer virus or ‘malware’

It also warned users of Apple’s Mac computers, considered relatively safe from virus attacks, that they may also be subjected to malware attacks in the future.

‘For a variety of reasons, malware has rarely been a problem for Mac users. But those days might end soon,’ a spokesman said.

‘Our latest threat report depicts that malware has been on a steady incline in the first half of 2010,’ Mike Gallagher, chief technology officer of Global Threat Intelligence for McAfee, said in the report that was obtained by Reuters.

Last year £59.7million was lost to online banking fraud, according to Financial Fraud Action UK.

Another £440million was lost to credit card fraud.

And the problem is said to be on the rise, with criminals attacking banks’ customers rather than the banks themselves as they are seen as softer targets.

A Financial Fraud Action UK spokeswoman said: ‘The idea that criminals are targeting people by using malicious software or Trojans is nothing new.

Bank systems are hard to attack so they have to go through the easier link in the chain, which is the customers.

They’re hoping customers aren’t taking security precautions. We’ve been seeing this for the last few years and we’re constantly urging people to protect their computers to try to mitigate the risk of becoming a victim.’

Victims of online banking fraud are generally refunded the money.

Computer Clarity

PandaLabs, the anti-malware laboratory of Panda Security, The Cloud Security Company, has reported the proliferation of scams hijacking the Facebook “Like” option. The attack uses eye-catching messages related to the popular game Farmville, the “Sex and the City 2” movie or the keyword sex to grab the attention of logged-in Facebook users as they browse Web pages with the “Like” button, the Facebook wall feature or messaging system.

Clicking the link brings the user to a Web page containing photos and videos of the relevant topic. Upon visiting it, a message is displayed on the user’s Facebook profile indicating that they “like” it, with a text that is not controlled by the user. According to Luis Corrons, Technical Director of PandaLabs, “This distribution technique reminds us of computer worms, although this time there doesn’t seem to be any malware behind it (at least yet).”

This technique, known as ‘clickjacking,’ uses a malformed URL with embedded code to carry out the attack. Visiting users are tricked into “liking” a page without necessarily realizing that they are recommending it to all of their Facebook friends. The real business stems from the pay-per-click system, which counts every click and generates revenue for affiliates, and from the tests offered to users on every page, which they must pay to make.

“Cyber-criminals can make money just by tricking you into visiting a Web page with ads,” Luis Corrons says. “Or worse still, they can spread malware and infect you. This possibility has not yet been exploited, but it would be relatively easy and effective to do it.”

PandaLabs advises users to be extremely wary of messages with striking subjects received from Facebook’s internal messaging system, and to take all necessary precautions when clicking the “Like” button on external Web pages. Also, PandaLabs recommends that users refrain from entering any banking or credit card information in applications that try to sell them any kind of test.

Computer Clarity

PandaLabs, the anti-malware laboratory of Panda Security, has released its forecast of computer threat trends for the coming year.

More clouds on the security horizon

Welcome to the cloud. In 2007, we launched our first product which took advantage of the cloud, now in 2009 all our products use it and we have launched the first 100% cloud-based antivirus: Panda Cloud Antivirus. We have also seen this year how other major security vendors have followed our steps and taken to the cloud. 2010 will be the year in which all anti-malware companies wanting to offer real-time protection will have to follow suit. And those that don’t will be out of the game.

An avalanche of malware

The amount of malware in circulation will continue to grow exponentially. The greater speed delivered by cloud-based technologies, such as Panda’s Collective Intelligence, will force malware creators to generate even more threats in order to evade detection and elimination. Once again malware will be designed almost exclusively for financial gain, and we can expect to see many new fake antiviruses (rogueware), bots and banker Trojans.

Social engineering

Cyber-criminals will again be focusing on social engineering techniques to infect computers, particularly those targeting search engines (BlackHat SEO) and social networks, along with ‘drive-by-download’ infections from Web pages.

As the football World Cup takes place in South Africa, we can also expect to see significant amounts of malware related to this event: false ticket offers, junk mail, etc. It is always a good idea to take a suspicious view of any messages related with current affairs and large events such as this.

In the case of social networks, there have already been many examples of worms and Trojans targeting Twitter, Facebook, etc. Malware creators will continue to be drawn to these types of platforms used by so many people.

Windows 7

Windows 7 will have a major impact on malware development: where Windows Vista hardly caused a ripple, Windows 7 will make waves. One of the main reasons is the widespread market acceptance of this new OS, and as practically all new computers are coming with Windows 7 64-bit, criminals will be busy adapting malware to the new environment. It may take time, but we expect to see a major shift towards this platform over the next two years.

Cell phones

Will 2010 be the year of malware for cell phones? Several security companies have been warning for some time that malware is soon to affect cell phones in much the same way as it affects PCs. Well, we hate to rain on their parade, but 2010 will not be the year of malware for cell phones.

The PC is a homogenous platform, with 90% of the world’s computers running Windows on Intel, meaning that any new Trojan, worm, etc. has a potential victim pool of 90% of the world’s computers. The cell phone environment is much more heterogeneous, with numerous vendors using different hardware and different operating systems.

Applications are sometimes not even compatible from one OS version to another. So it is once again unlikely that 2010 will see widespread targeting of cell phones by malware. In any event, this year will witness many changes in the world of mobile telephony with more smartphones offering practically the same features as a PC; the emergence of Google Phone –first phone sold directly by Google without tying users to specific operators-; the increasing popularity of Android, not to forget the success of the iPhone. If in some years there are only two or three popular platforms, and if people begin to operate financial transactions from their cell phones, then maybe we could talk about a potential breeding ground for cyber-crime.

Mac

Mac: has the danger arrived? Mac’s market share has increased in recent years. Although the number of users has yet to reach the critical mass required to make it as profitable as PCs for cyber-criminals, it is nevertheless becoming more attractive. Mac is used just as PCs are to access social networks, email, the Internet… and these are the main malware distribution systems used by cyber-criminals. Consequently, Mac is no longer a safe haven against malware. These criminals can easily distinguish whether a system is Mac, and they have malware designed especially to target this OS. In 2009 we have already seen numerous attacks, and there are more to come in 2010.

The Cloud

Cloud-based services are not just used for security. We are all using more services delivered from the cloud, often without realizing. Who doesn’t use Hotmail or Gmail as their email service, or Flickr to store photos? But cloud-based services are not limited solely to storage, they are also used for processing data. The cloud is a tool that can help save considerable costs for companies, and as such is rapidly growing in popularity. This makes attacks on cloud-based infrastructure/services far more likely.

Cyber war

Although this term is more associated with science fiction than the real-world, it’s a phrase we are about to start hearing more often. Throughout 2009, governments around the world including the United States, the UK and Spain, have expressed concern about the potential for cyber-attacks to affect economies or critical infrastructure. We also saw this year how several Web pages in the United States and South Korea were the subject of attacks, with suspicion –as yet unapproved- pointing at North Korea. In 2010 we can expect to see similar politically-motivated attacks.

Computer Clarity