A new report out today shows how mobile malware and mobile botnets are quickly catching up in sophistication with their PC brethren. Researchers at Lookout call this malware family one of the most sophisticated mobile botnets running online today.

Dubbed NotCompatible, the botnet and the mobile malware family that drives it turn mobile devices into TCP proxies that can be used in any number of creative ways, including to send spam, commit click fraud, employ brute-force passwords, and initiate fraudulent ticket purchases. That's not anything new, but what makes this threat different is the level of sophistication in the backend of NotCompatible to resist reverse engineering and takedown efforts by the security community.

"Our research is on this malware family we call NotCompatible shows that as mobile is becoming ubiquitous, mobile malware is starting to reach parity with the sophistication of PC malware," says Jeremy Linden, security product manager for Lookout. "To date we haven't seen another mobile botnet that's nearly as sophisticated and definitely not as long-lived as NotCompatible."

According to Linden, the botnet has continuously run for two years now. However, while the monetary modus operandi has remained the same over that time period, the malware and botnet infrastructure has recently undergone a massive overhaul. With that reworking, the network's developer has tipped his or her hand as to how profitable NotCompatible really is due to the complicated resiliency features built in now, he says.

"Clearly someone put a lot of thought and time into developing this architecture," Linden says, "which means that these tactics are actually paying out for them."

Some of the features of the architecture include a redundant command and control server architecture that's geographically dispersed around the world to help "absorb the impact of takedowns," as well as authentication of infected nodes through a central gateway server to prevent researchers from trying to connect as impostor bots in order to listen in on what the criminals are doing. Additionally, NotCompatible utilizes peer-to-peer communication between the nodes for added resiliency.

"Even if you take down the command and control server that one infected node is connecting to, that infected node can actually receive commands that are relayed through other infected nodes in that mesh network in order to keep the network alive and propagating," Linden says.

According to Linden, the rise in NotCompatible is a good lesson that security researchers should pay more attention to mobile threats over longer periods of time.

"A lot of time researchers will classify a certain piece of malware and say 'We've got it!' and file it off in a shelf and not really study it," he says. "That kind of approach wouldn't really have worked with NotCompatible. A researcher may have written it off when they first discovered it because it was just a proxy server and didn't seem to be doing that much damage. But studying it for years showed how sophisticated this network did become."

Meanwhile, enterprises should be on the lookout for the threat that this growing class of botnets may pose for them. While Lookout hasn't observed the botnet being used to bypass network protections, Linden warns that as completely unrestricted proxies, the infected nodes present attackers with the opportunity to bypass the kind of perimeter defenses networks use.

"This is a privileged device that's moving between porous network boundaries, being used for personal use and then potentially also used for business," Linden says. "If one of these devices does end up behind someone's firewall, it offers the operator of the botnet unfettered access to the juicy center of an enterprise network."