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More Money, More Web Scams

At Black Hat USA, WhiteHat Security researchers to highlight more and bigger-dollar hacks that don't use malware or security bugs

There was the iPod repairman online who allegedly pulled in a half-million dollars defrauding Apple and its iPod customers. There was also the hacking-for-hire scheme that made the bad guys a tidy nine-figure profit.

While the security industry spends most of its energy and resources on malware- and vulnerability-based methods of attack, a lesser-known and more lucrative world of hacking is going on right under our noses that rarely comes to light unless it makes the general news. These are the low-tech and no-tech attacks and scams that don't require malware or scanners, and they are rarely reported because they don't typically involve reporting stolen credit cards or other personal information. "This is the easier, higher dollar [attacks]," says Jeremiah Grossman, CTO of WhiteHat Security. "These almost never get reported...they are basic fraud losses that everyone keeps quiet about."

Grossman and WhiteHat colleague Trey Ford, director of solutions architecture, will present a sequel to their previous Black Hat USA talk about these simple but deadly attacks at next week's Black Hat USA conference in Las Vegas. "We're going to pick up where we left off last time. These are all the ways bad guys are making money, and we'll show off real-world hacks," Grossman says. They will also align their research with the findings in Verizon's recent breach report.

The pair have a few surprises up their sleeves, but among the examples of these low-tech but clever hacks they'll highlight is that of the former www.ipodmechanic.com guy, who faces federal charges for allegedly bilking Apple for more than 9,000 replacement iPod Shuffles. "He was guessing serial numbers on iPods, filling out [warranty repair claims], and using Visa prepay gift cards to get replacement iPods," Grossman notes. But the gift cards were only for $1, and he turned around and resold the iPods for a profit.

In another lucrative scam that also played off of the iPod's popularity, a group of DJs in the U.K. set up their songs to be sold online via iTunes and Amazon.com. To bump up their royalties, they purchased their own songs from the sites using stolen credit cards, Grossman says, and made close to $300,000. "People looking at their credit card bill weren't likely to see a dollar here and there" if their account had been used in the scam, he says.

In their previous research, Grossman and Ford have shed light on abusing business logic flaws -- or weaknesses in the business processes themselves -- such as using a simple script to manipulate the results of an online poll. The techniques themselves aren't necessarily new, but the Web model makes them more lucrative than ever (and no exploits are required).

"There are three different tiers of hackers: ones who use bots and malware; ones who use commercial scanners and don't care what ecommerce site they hack; and the top tier that's very targeted" in their attacks, Grossman says. "No one is off-limits anymore. People are going to try these things on you."

The researchers will also reveal details of a hack that resulted in a nine-figure profit.

Have a comment on this story? Please click "Discuss" below. If you'd like to contact Dark Reading's editors directly, send us a message. Kelly Jackson Higgins is the Executive Editor of Dark Reading. She is an award-winning veteran technology and business journalist with more than two decades of experience in reporting and editing for various publications, including Network Computing, Secure Enterprise ... View Full Bio

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