Security vendor Zscaler has issued an alert on what it describes as a sophisticated new keylogger that is designed to capture every single keystroke and conduct extensive surveillance on an infected computer.

Dubbed iSpy, the keylogger is equipped to steal passwords, capture screenshots, and monitor clipboards and webcams on victim systems, Zscaler said in an alert this week.

The malware is customizable and can be tweaked to not only record keystrokes but also to recover passwords and the license keys to applications like Microsoft Office and Photoshop that may be running on a victim’s system. In addition, it collects data like username, Windows version and the details of antivirus software, browser version, and firewalls.

The iSpy keylogger malware then uses either the FTP, SMTP, or HTTP protocols to send the stolen data over to a remote command-and-control computer controlled by the attackers, the security vendor said.

Like many other malware tools, iSpy is distributed as a malicious attachment in spam email. It supports multiple features that are designed to make it hard to detect and delete. The encrypted payload itself is compressed using packers written in .Net, Visual Basic 6.0 and AutoIT, Zscaler said in its alert.

One of the packers that the company inspected contained what the vendor described as obfuscated zombie code apparently to slow down analysis of the malware. Some of the packers are digitally signed using mostly invalid digital certificates, the security vendor said. When installing on a machine, the iSpy keylogger malware employs multiple techniques to avoid detection by antimalware tools.

"iSpy keylogger contains advanced keylogger functionality to steal information, monitor the target user's system activity via screenshots, and act as a surveillance system for criminals by capturing video through an infected system's webcam,” says Deepen Desai, director of security research at Zscaler.

In addition to stealing user credentials from web browsers and popular applications installed on the system, a unique feature of this keylogger is to steal license keys for specific applications like Microsoft Office and Adobe Photoshop, Desai says.

"The motive here appears to be piracy. The authors will attempt to make money by selling these license keys in addition to user credentials,” he says.  

The iSpy malware samples that Zscaler has inspected in its cloud sandbox did not appear to be targeted in nature unlike some other recent commercial keyloggers like AgentTesla, he says.

ISpy is currently available in underground forums in the form of multiple subscription packages designed to appeal to criminals with varying degrees of technical abilities. The cheapest option is a $25 Bronze Package, which offers a one-month access to the malware, instant activation, free support and free updates. iSpy is also available in the form of a "small business" package priced at $35 for six-month access to the malware and six months of free support and updates. The most popular option apparently is a $45 package for one-year access, support, and upgrades.

“Overall, we are seeing a rise in malicious activity involving commercial keyloggers," Desai says. The tools make it very easy even for a naïve user with malicious intent to conduct successful attacks, he says.

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