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CSO - European law enforcement authorities, aided by an American cybersecurity firm, rounded up a ransomware gang in Spain and the United Arab Emirates whose illegal operations were raking in some $1.3 million in profits annually.
[COSTLY: Corporate cybercrime costs skyrocket]
Eleven men -- seven Russians, two Ukrainians and two Georgians -- were arrested in the bust, which dismantled the largest and most complex cyber crime network in the world for spreading police ransomware, according to Europol's European Cybercrime Center and Spanish Police.
The law enforcement authorities estimate that the ring hit tens of thousands of computers worldwide.
After infecting a computer, the police-themed ransomware locks up a computer's operation and displays an official-looking splash screen purporting to be from a law enforcement agency, such as the FBI in United States.
The splash screen informs the computer user that they've engaged in illegal online activity in the past and must pay a fine -- usually 100 Euros ($130) -- if they want control of their computer back.
[See also: Symantec: Cyber crooks make millions off ransomware.]
Often, the ransomware is planted on websites that would embarrass a visitor viewing them, said Christopher Budd, threat communication manager for Trend Micro, a Cupertino, Calif. maker of cybersecurity software. "They will target sites that are associated with illegal activity or activity people may be ashamed of," he said.
"You may be on a pornography site that's not illegal but you may not know that and you may feel guilty about being on a porn site in the first place," he continued. "And lo and behold, after going to that site -- boom -- the police screen pops up on your computer."
To pay the fine, the bogus cyber cops steer victims to a number of fast-cash websites. They include Ukash, Paysafecard and MoneyPak.
The malware planted on the computer to extract the fine -- a ransomware strain called Reveton -- also ransacks the machine's files for sensitive information that could be used for identity theft and credit card fraud.
Worse yet, paying the ransom doesn't guarantee control of the computer will be returned to the user. "Once the criminals have the money, they don't even bother to unlock your computer," Jerome Segura, a security researcher for Malwarebytes in San Jose, Calif. said in an interview.
Not only do computer operators suffer monetary losses from ransomware, but it's very difficult to purge -- even if you pull the plug on an infected computer. "If you turn the power off and turn it back on, as soon as the Windows desktop loads, the malware will lock your screen again," Segura said.
Money flowing into the ransom gang's coffers was elaborately laundered using both virtual and traditional methods, according to Europol. Those methods included using online gaming portals, electronic payment gateways and virtual coins.
In Spain, compromised credit card numbers from victims' computers were used to make ATM withdrawals.
At the end of the laundry chain, daily international money transfers through currency exchanges and call centers were used to get the money to its final destination in Russia.