Israeli police uncover Trojan industrial spy ring

TechWorld.com - Israeli police have uncovered an industrial spy ring that allegedly used Trojan software to snoop into some of that country's leading companies.
A report in the English-language newspaper Haaretz details how a wide range of businesses, including TV, mobile phone, car import and utility companies, used a Trojan program believed to have been written by a husband-and-wife team living in London to spy on business rivals.
The couple, Michael Haephrati and Ruth Brier-Haephrati, have been arrested pending extradition procedures on June 3. In Israel, another 21 people have been questioned in connection with the case.
Police believe that the companies started using the software after hiring one of three private investigation agencies given the task of carrying out the industrial espionage.
"It is hard to believe that the most senior people [at companies employing the private investigators] did not know about the spyware," the newspaper quoted an Israeli police source as saying. "Even if it was ordered by some head of a security department from a private investigator, it was passed onto the CEO -- and it is clear to us they must have guessed how the material was gathered."
The program appears to have been effective at stealing confidential documents from targeted companies, as well as monitoring activity on infected machines. Police reportedly gained access to a number of file transfer protocol servers in the U.S. and Israel, and discovered "tens of thousands" of documents taken from victim companies.
The fraud is believed to have used two simple methods of attack, both of which bypassed normal safeguards such as perimeter security or antivirus programs. The first involved sending a disk to an individual at one of the targeted companies purporting to contain a business proposal. When explored, the disk would install the Trojan software on that person's PC. Alternatively, the same process could be undertaken via e-mail.
Whether antivirus or other security software detected the software depended on how the computers were configured and which types of defense software were present.
The spy ring came to light several months ago, after Israeli author Amnon Jacont complained that passages of a book he was writing had appeared on the Internet, despite never having left his PC. Subsequent investigations led police to the Trojan software.