They're sneaky and stubborn, but trojans are one of the few types of malware that don't spread on their own. And they are becoming one of the most prolific and stealthy exploits in the wild, according to reports from a variety of security vendors and researchers.

Most trojans today are transported via spam email and malicious Websites, or they get dropped by other malware onto an already infected computer. They are popular recruiters for armies of botnets, too. But what scares researchers most is, although trojans aren't the most complex forms of malware, they are increasingly being used for more sophisticated and targeted attacks.

The new Internet Explorer exploit that's rapidly spreading in the wild right now is installing trojans, as a matter of fact. (See IE Exploit Could Soon Be Used By 10,000-plus Sites and How to Defend Against IE's VML Bug.) A trojan is basically malware that looks like a legitimate program but was actually designed to do nefarious things like allow other users to gain access to your computer or to do damage in conjunction with a virus, such as deleting files.

"A trojan's purpose is to either send out spam or steal information from a user," says Ron O'Brien, senior security analyst with Sophos. "That information is most often in the form of bank account, logon, and password."

The most popular family of trojans today are the so-called Banker trojans. Sophos says there were 4,000 unique types of Banker trojans reported all of 2005, but as of the end of June of this year, that number spiked to 6,000. McAfee Avert Labs has a more modest count of what it calls the Banker trojan, with 3,000 variants, but the bottom line is this family of trojans has an inordinate number of variants.

Sophos has seen so many variants that it's gone through the alphabet three times with Banker trojan names, Sophos's O'Brien says.

Another prominent family of trojans is the Downloader clan, of which there are around 30 variants, says Craig Schmuger, a virus researcher for McAfee Avert Labs. One of the most commonly reported trojans in the past month was the Downloader-ASH trojan, he says. And the Downloader-AAP -- which has about 30 variants -- is a spam email "regular," according to Schmuger.

"A Downloader trojan is pretty small, so it's preferred by spammers," he says. "And when it starts getting the attention of antivirus vendors, [attackers] change the executable," for instance, he says, so it can't be detected by the latest signature release.

"If you were to measure strictly on prevalence, then trojan Downloaders would be the top," says Dan Hubbard, vice president of security research at Websense. "But Downloaders on their own are not much use. Their mission is simple: Avoid signature detection, in many cases, attempt to disable AV and firewalls, and then download another piece of code."

Then there are the growing number of Haxdoor backdoor trojans, which are built from a hacker tool of the same name. Haxdoor trojans are sometimes used to steal sensitive data and are especially difficult to detect. "It's incredibly slippery to identify and get rid of," says Jose Nazario, software and security engineer for Arbor Networks. "There is a huge proliferation of Haxdoor variants."

The increasing number of trojans overall is making it harder to detect them, but security experts say the bigger issue is their increasing sophistication in stealing data. Websense's Hubbard says that Banking/Banker is one such trojan used for stealing data from individuals and then delivering that information to third parties -– ostensibly to the criminals gathering that information.

Trojan profiteering, Hubbard says, where trojans and exploit code is sold, is a bigger concern. "This allows non-sophisticated users to get sophisticated, malicious code and exploit tools to perform attacks."

That's when trojans are used in targeted attacks -– the most dangerous attack, researchers say. "Targeted trojans are targeted to specific victims and paired up with very fine-tuned and relevant social engineering, and frequently used for corporate and industrial espionage," says Nick Bilogorskiy, senior malicious code researcher for SonicWall's vulnerability research team.

There's also been a surge overall in the last six to nine months of attacks on client-side software, Nazario says, and especially, zero-day attacks like the latest IE bug. Attackers are taking advantage of Microsoft's monthly patch cycle by launching these exploits between Patch Tuesdays, he says.

With the new IE bug, which leverages a vulnerability in the Vector Markup Language, an attacker basically installs the malware on a Website it controls or one it has broken into, and downloads a trojan onto the victimized computer via the Web browser vulnerability, says Oliver Friedrichs, director of Symantec Security Response. "It happens behind the scenes with little interaction."

What's next for trojans? Attackers will more deeply embed them into the infected computer so it's harder to remove them, says McAfee's Schmuger. Attackers are using so-called "packer" tools, to mutate and disguise trojan code so it can't be detected by signature-based AV systems, he says.

And look for attackers more and more to target fewer machines with different trojans. "They are smart and well-funded," says Paul Moriarty, director of product marketing for Trend Micro. "If a 19-year-old kid right out of college can make a half-million dollars a year for click fraud, why not?"

— Kelly Jackson Higgins, Senior Editor, Dark Reading