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Ransomware Attackers' New Tactic: Double Extortion – Security Intelligence

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Ransomware Attackers’ New Tactic: Double Extortion
Need another reason to defend against ransomware instead of ending up having to find a solution other than paying it? Double extortion may be it.
So, what is double extortion? When did it start? With this tactic, ransomware actors steal a victim’s data before their malware strain activates its encryption routine. They then have the option of demanding two ransoms. The first one is the provision of a decryption utility. The second one guarantees verbal confirmation of having deleted the victim’s data from their servers. They can also leverage that data theft to pressure victims — even those that have a robust data backup strategy.
In November 2019, the Maze gang struck a security staffing firm. Bleeping Computer received an email from someone who claimed to be a member of the Maze Crew. It informed the computer self-help website that they had breached the security staffing firm and stolen some of their data.
“If they don’t begin sending requested money until next Friday we will begin releasing on public everything that we have downloaded from their network before running Maze[sic],” the individual explained.
The security staffing firm missed its deadline to pay. So, the Maze ransomware group published 700 MB worth of its data. The threat actors told Bleeping Computer that the leak represented about 10% of the total number of stolen files. As such, the attackers threatened to release the rest of them if the victim continued to refuse to pay.
The use of double extortion picked up from there. For its part, Maze helped some ransomware groups experiment with the tactic through its cartel, while other ransomware groups created data leaks sites on their own. This led to an increase in double extortion over H1 2020. During that period, ID Ransomware received 100,001 submissions pertaining to ransomware attacks. Just over 11% of those submissions, or 11,642 of them, related to attacks that involved data theft, noted Emsisoft.
Ransomware actors took their efforts one step further at the end of 2020 and the start of 2021. They began using triple extortion, a technique where they singled out customers and third parties for their own ransom payments. As noted by WIRED, the first case occurred in October 2020 when a Finnish psychotherapy clinic experienced a data breach that involved a ransomware attack. Those responsible for the infection demanded a ransom from the clinic, but they also demanded smaller sums from individual patients via email.
The second instance of triple extortion occurred in February 2021. At that time, Bleeping Computer reported that the REvil/Sodinokibi ransomware gang had begun placing phone calls to the victim’s business partners and media. The purpose of those calls was to publicly embarrass the company and create even more pressure for the victim to fulfill the attackers’ ransom demand(s).
Even more layers of extortion emerged in the months that followed. For instance, in October, the FBI warned that the HelloKitty group had begun threatening to target victims’ public-facing websites with distributed denial-of-service attacks if they refused to pay the ransom or didn’t do so quickly enough. KnowBe4 reported that other ransomware actors had begun threatening to repeat the attack and delete all their victims’ data if they decided to contact law enforcement or professional negotiators following an infection.
All these levels of extortion are driving up ransomware costs. Specifically, they’re giving attack groups more impetus to raise their demands. The average ransom asks increased to between $50 million and $70 million in the first half of the year. Many victims end up paying a fraction of that, as they might be able to negotiate those requests down and/or rely on a cyber insurance policy to cover at least part of those costs. In either case, they legitimize ransom demands of that amount and encourage attackers to keep making them. It’s, therefore, no wonder that ransomware costs are expected to reach a collective total of $265 billion by 2031.
Double, triple and all the other extortion levels discussed above have helped to elevate ransomware into a multi-faceted threat. SonicWall logged 470 million ransomware attacks through the third quarter of the year. That’s a 148% year-over-year increase. That company detected 190.4 million attacks in Q3 2021 alone, a figure which nearly overtook the 195.7 million ransomware attacks detected in the first three quarters of 2020.
Looking ahead, the firm estimated that ransomware totals would reach 714 million attack attempts by the end of December, making 2021 the most prolific year on record. These volumes explain why the U.S. federal government is working to combat ransomware by sanctioning cryptocurrency exchanges that have moved money for ransomware actors and by introducing bills that could require victims to publicly disclose ransom payments.
Even so, organizations can’t rely on the federal government alone to keep their systems and data safe. They need to focus on their ransomware prevention strategies by prioritizing three security measures. First, they can invest in their security awareness training to educate all employees and cultivate their familiarity with ransomware attacks. Second, they can use their vulnerability management programs to prioritize and remediate security weaknesses that malicious actors could exploit as a means to drop ransomware onto organizations’ systems. Finally, they can use data encryption as a means to protect their data against ransomware attempts.
David Bisson is an infosec news junkie and security journalist. He works as Contributing Editor for Graham Cluley Security News and Associate Editor for Trip…
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Prosecutors seek from 40 to 50 years in prison for Sam Bankman-Fried for cryptocurrency fraud

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Prosecutors seek from 40 to 50 years in prison for Sam Bankman-Fried for cryptocurrency fraud

By LARRY NEUMEISTER

NEW YORK (AP) — FTX founder Sam Bankman-Fried’s orchestration of one of history’s largest financial frauds in his quest to dominate the cryptocurrency world deserves a prison sentence of 40 to 50 years, federal prosecutors on Friday told a federal judge.

Prosecutors made the recommendation in papers filed in Manhattan federal court in advance of a March 28 sentencing, where a judge will also consider a 100-year prison sentence recommended by the court’s probation officers and a request by defense lawyers for leniency and a term of imprisonment not to exceed single digits.

Bankman-Fried, 32, was convicted in November on fraud and conspiracy charges after his dramatic fall from a year earlier when he and his companies seemed to be riding a crest of success that had resulted in a Super Bowl advertisement and celebrity endorsements from stars like quarterback Tom Brady and comedian Larry David.

Some of his biggest successes, though, resulted from stealing at least $10 billion from investors and customers between 2017 and 2022 to buy luxury real estate, make risky investments, dispense outsized charitable donations and political contributions and to buy praise from celebrities, prosecutors said.

 

FILE - Sam Bankman-Fried leaves Manhattan federal court in New York on Feb. 16, 2023. Bankman-Fried's lawyers are seeking leniency next month at the FTX founder's sentencing for cryptocurrency crimes. The lawyers filed presentence arguments late Monday, Feb. 26, 2024, in Manhattan federal court. (AP Photo/Seth Wenig, File)

 

“His life in recent years has been one of unmatched greed and hubris; of ambition and rationalization; and courting risk and gambling repeatedly with other people’s money. And even now Bankman-Fried refuses to admit what he did was wrong,” prosecutors wrote.

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“Having set himself on the goal of amassing endless wealth and unlimited power — to the point that he thought he might become President and the world’s first trillionaire — there was little Bankman-Fried did not do to achieve it,” prosecutors said.

They said crimes reflecting a “brazen disrespect for the rule of law” had depleted the retirement funds and nest eggs of people who could least afford to lose money, including some in war-torn or financially insecure countries, and had harmed others who sought to “break generational poverty” only to be left “devastated” and “heartbroken.”

“He knew what society deemed illegal and unethical, but disregarded that based on a pernicious megalomania guided by the defendant’s own values and sense of superiority,” prosecutors said.

Bankman-Fried was extradited to the United States in December 2022 from the Bahamas after his companies collapsed a month earlier. Originally permitted to remain at home with his parents in Palo Alto, California, he was jailed last year weeks before his trial after Judge Lewis A. Kaplan concluded that he had tried to tamper with trial witnesses.

In their presentence submission, prosecutors described Bankman-Fried’s crimes as “one of the largest financial frauds in history, and what is likely the largest fraud in the last decade.”

“The defendant victimized tens of thousands of people and companies, across several continents, over a period of multiple years. He stole money from customers who entrusted it to him; he lied to investors; he sent fabricated documents to lenders; he pumped millions of dollars in illegal donations into our political system; and he bribed foreign officials. Each of these crimes is worthy of a lengthy sentence,” they wrote.

They said his “unlawful political donations to over 300 politicians and political action groups, amounting to in excess of $100 million, is believed to be the largest-ever campaign finance offense.”

And they said his $150 million in bribes to Chinese government officials was one of the single largest by an individual.

“Even following FTX’s bankruptcy and his subsequent arrest, Bankman-Fried shirked responsibility, deflected blame to market events and other individuals, attempted to tamper with witnesses, and lied repeatedly under oath,” prosecutors said, citing his trial testimony.

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Two weeks ago, Bankman-Fried attorney Marc Mukasey attacked a probation office recommendation that their client serve 100 years in prison, saying a sentence of that length would be “grotesque” and “barbaric.”

He urged the judge to sentence Bankman-Fried to just a few years behind bars after calculating federal sentencing guidelines to recommend a term of five to 6 1/2 years in prison.

“Sam is not the ‘evil genius’ depicted in the media or the greedy villain described at trial,” Mukasey said, calling his client a “first-time, non-violent offender, who was joined in the conduct at issue by at least four other culpable individuals, in a matter where victims are poised to recover — were always poised to recover — a hundred cents on the dollar.”

Mukasey said he will respond to the prosecutors’ claims in a filing next week.

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Biden to create cybersecurity standards for nation’s ports as concerns grow over vulnerabilities

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Biden to create cybersecurity standards for nation’s ports as concerns grow over vulnerabilities

WASHINGTON (AP) — President Joe Biden on Wednesday signed an executive order and created a federal rule aimed at better securing the nation’s ports from potential cyberattacks.

The administration is outlining a set of cybersecurity regulations that port operators must comply with across the country, not unlike standardized safety regulations that seek to prevent injury or damage to people and infrastructure.

“We want to ensure there are similar requirements for cyber, when a cyberattack can cause just as much if not more damage than a storm or another physical threat,” said Anne Neuberger, deputy national security adviser at the White House.

Nationwide, ports employ roughly 31 million people and contribute $5.4 trillion to the economy, and could be left vulnerable to a ransomware or other brand of cyberattack, Neuberger said. The standardized set of requirements is designed to help protect against that.

The new requirements are part of the federal government’s focus on modernizing how critical infrastructure like power grids, ports and pipelines are protected as they are increasingly managed and controlled online, often remotely. There is no set of nationwide standards that govern how operators should protect against potential attacks online.

The threat continues to grow. Hostile activity in cyberspace — from spying to the planting of malware to infect and disrupt a country’s infrastructure — has become a hallmark of modern geopolitical rivalry.

For example, in 2021, the operator of the nation’s largest fuel pipeline had to temporarily halt operations after it fell victim to a ransomware attack in which hackers hold a victim’s data or device hostage in exchange for money. The company, Colonial Pipeline, paid $4.4 million to a Russia-based hacker group, though Justice Department officials later recovered much of the money.

Ports, too, are vulnerable. In Australia last year, a cyber incident forced one of the country’s largest port operators to suspend operations for three days.

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In the U.S., roughly 80% of the giant cranes used to lift and haul cargo off ships onto U.S. docks come from China, and are controlled remotely, said Admiral John Vann, commander of the U.S. Coast Guard’s cyber command. That leaves them vulnerable to attack, he said.

Late last month, U.S. officials said they had disrupted a state-backed Chinese effort to plant malware that could be used to damage civilian infrastructure. Vann said this type of potential attack was a concern as officials pushed for new standards, but they are also worried about the possibility for criminal activity.

The new standards, which will be subject to a public comment period, will be required for any port operator and there will be enforcement actions for failing to comply with the standards, though the officials did not outline them. They require port operators to notify authorities when they have been victimized by a cyberattack. The actions also give the Coast Guard, which regulates the nation’s ports, the ability to respond to cyberattacks.

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Why Was Sam Altman Fired? Possible Ties to China D2 (Double Dragon) Data from Hackers

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Theories are going around the internet why Sam Altman was fired. On an insider tech forum (Blind) – one person claims to know by third-hand account and how this news will trickle into the media over the next couple of weeks.

It’s said OpenAI had been using data from D2 to train its AI models, which includes GPT-4. This data was obtained through a hidden business contract with a D2 shell company called Whitefly, which was based in Singapore. This D2 group has the largest and biggest crawling/indexing/scanning capacity in the world 10x more than Alphabet Inc (Google), hence the deal so Open AI could get their hands on vast quantities of data for training after exhausting their other options.

The Chinese government became aware of this arrangement and raised concerns with the Biden administration. As a result, the NSA launched an investigation, which confirmed that OpenAI had been using data from D2. Satya Nadella, the CEO of Microsoft, which is a major investor in OpenAI, was informed of the findings and ordered Altman’s removal.

There was also suggestion that Altman refused to disclose this information to the OpenAI board. This lack of candor ultimately led to his dismissal and is what the board publicly alluded to when they said “not consistently candid in his communications with the board.”

To summarize what happened with Sam Altman’s firing:

1. Sam Altman was removed from OpenAI due to his ties to a Chinese cyber army group.

2.OpenAI had been using data from D2 to train its AI models.

3. The Chinese government raised concerns about this arrangement with the Biden administration.

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4. The NSA launched an investigation, which confirmed OpenAI’s use of D2 data.

5. Satya Nadella ordered Altman’s removal after being informed of the findings.

6. Altman refused to disclose this information to the OpenAI board.

 

We’ll see in the next couple of weeks if this story holds up or not.

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