In new attack on mobile handsets, fraudsters target one-time-passwords

CSO - Security for mobile handsets keeps improving. But then, mobile threats to those handsets keep improving as well.

Among the most recent, reported by Trusteer, a Boston-based provider of secure web access services, are two online banking fraud schemes designed to defeat the one-time-password (OTP) authorization systems used by many banks.

According to Trusteer, these new threats go a step beyond earlier attacks in which criminals would change a victim's phone number to redirect OTPs to them.

"In these new scams, the criminals are stealing the actual mobile device SIM (subscriber identity module) card," the company said.

The first kind of attack uses the Gozi Trojan to steal IMEI (international mobile equipment identity) numbers from online bank account holders when they log in.

"Once they have the IMEI number, the criminals contact the victim's wireless service provider, report the mobile device as lost or stolen, and request a new SIM card. With this new SIM card, all OTPs intended for the victim's phone are sent to the fraudster-controlled device," Trusteer said.

Oren Kedem, director of product marketing for Trusteer, said the Gozi attacks are mainly in the U.S. and that, "the level of infection is quite significant," even though the damage is not yet extensive.

"What's happening right now is that fraudsters are sitting on pile of information but not using it yet. Now we have to go through the process. I'm sure they are looking for the high-value customers first, so we expect to see a long tale of woe," he said.

The second type of attack, which Kedem said appears to be focused more in Europe, starts with a Man in the Browser (MitB) or phishing attack to obtain the victim's bank account details, including credentials, name, phone number, etc.

Trusteer says the criminal then goes to the local police station and uses that stolen personal information to get a police report that lists the mobile device as lost or stolen. He then calls the victim to and says his mobile phone service will be interrupted for the next 12 hours.

The criminal then presents the police report at one of the wireless service provider's retail outlets. The SIM card reported as lost or stolen is deactivated by the mobile network operator, and the criminal gets a new SIM card that receives all incoming calls and OTPs sent to the victim's phone number.

Trusteer says accounts protected by OTP systems typically have higher transfer limits and are less scrutinized. They are therefore more lucrative.

Kedem says the best way to defeat either threat is to be protected and be aware.

"The best practice requires three steps," he says. "First is to have security software from the bank itself that is designed to fight financial fraud. Second, don't play along with any change you see in the bank's web site that is asking for information it hasn't asked you for previously. Call the bank and ask about it."

Finally, he says, is the warning that is standard for online transactions of any kind: Be suspicious of any unsolicited call asking for personal information.

Kedem said it is not clear where the attacks are originating, but said it appears to be from the U.S. or Europe. Trusteer discovered the MitB attack on an underground forum. "The blog was written in English -- and not even broken English," he said.

Read more about wireless/mobile security in CSOonline's Wireless/Mobile Security section.