Cybercrime has been estimated to cost the global economy $1tn a year. The market is bigger than black market of heroin, marihuana and cocaine combined. According to McAfee Labs, by the end of this year there will be 75 million unique computer viruses in the world. Another research shows that there are 141 victims affected by viruses per minute in US only. In Great Britain the possibility to become a victim of cybercrime is three times higher than to straggle from an offline attack. Over one millionadults around the world are the victims of cybercrime every day.
The numbers are pretty scary, but today I’d like to discuss just one side of this complex and dynamic problem – how all of this changes political situation and how governments’ reaction affects our lives.
It is important to understand that not all hackers are “bad guys”. There are many absolutely legal hackers’ organizations around the world which have their international conventions with thousands of participants, workshops, magazines and even a certification program. If you Google “hackerspaces”, chances are you’ll find a couple of open hackers groups in your city. Hackers create new technologies, helpbuilding wireless mesh networks in Africa, repurpose old hardware for schools and charities. There are thousands of well educated and smart people who are proud of calling themselves “Ethical Hackers”.
On the other side of this scale are “Black Hat Hackers” who create malware, Trojans stealing data and money from people, businesses and government organizations. Among their victims this year are NASA, oil industry of Norway, Pentagon, the majority of Fortune 500 companies and banking systems.
Some of the most dangerous recent trends in cybercrime are social networks poisoning, phishing through mobile devices, attacks targeting industrial control systems. Trojans spreaded through Facebook chats and messages from fake “friends” (in reality profiles managed by bots) have infected millions of computers. Adoption of tablets and smartphones makes creation of viruses for them a very profitable business. During this year security specialists have observed almost 80% increase in malware targeting Android OS. Last year the news about Stuxnet, a worm aimed at Iran's nuclear facilities, attracted lots of attention. Recently the infrastructure systems of three US cities have been attacked, according to FBI. Recent cases of Duqu malware attacks have proven that the trend is on the rise.
Cybercrime has become one of major problems for governments of developed countries. And the main concern is not direct financial losses but the leakage of proprietary information and state secrets. New Pentagon strategy includes a military respond to cyber attacks. NATO has created a Cyber Defense Center. On the other hand UK cyber security programincludes creation of government-sponsored venture capital model to unlock innovation on cyber security in small and medium enterprises.
There is “the third force” in this battle. These people like to call themselves “hacktivists”. Governments see them as dangerous as ordinary criminals. But not everybody agrees with this opinion. The movement has been in existence for many years but now it attracts significant attention because of its involvement in much wider social activities (support of Occupy Wall Street Movement and Arab Spring for example). The ideology of hacktivism is well explained in “The HACKTIVISMO DECLARATION”written in 2001 by members of Cult of the Dead Cow and Hacktivismo group. Hacktivists promote nonviolent use of legal and/or illegal digital tools in pursuit of political ends which include freedom of information, civil rights and support of democratic movements.
Probably the most famous group of haktivists is Anonymus. According to “The Hacker News”, their latest achievements include hacking a Nazi organization’s website in Scandinavia, obtaining information about major drug cartel in Mexico, closing of several child pornography websites in Chile and cyber war against US Congress’s efforts to limit freedom of information on the web. Another group, Chaos Computer Club, based in Germany, emerged recently in the epicenter of a huge scandal. The hackers analyzed government spyware, "Staatstrojaner", and came to conclusion that besides stealing the data from infected devices the Trojan can be used to remotely control and manipulate the computer. Significant design and implementation flaws make all of the functionality available to anyone on the internet.
This discovery brings us to a question: why despite all efforts of law enforcement organizations cybercrime continue to be a major threat to security of private citizens, businesses and whole nations? It doesn’t take much time or money to find “black hat hackers”. You can order their services through several freelancers’ websites or search on Google. They have Facebook pages, websites, and forums. Some of them offer free scripts and tutorials on how to destroy computers and put a spyware on phones. Their services are affordable for anybody:distribution of Trojan – from $20 for 1000 addresses, hacking a website - from $50, DDoS attack on e-commerce store - from $80 for 24 hours. This is just a small part of what is openly available on the web. There is no sense of danger for the provders.
One of the reasons is the international collaboration of the criminals, difficulties to prove the fact of the criminal act by any particular person and differences in national laws. The authors of “Koobface: Inside a Crimeware Network” research state: “Cybercrime has elicited so little prosecution from the world’s law enforcement agencies that it makes one wonder if a de facto decriminalization has occurred. Not surprisingly, it is seen as a safe yet challenging way out of structural economic inequality by the burgeoning number of educated young coders of the underdeveloped world. Sitting in front of a glowing monitor thousands of miles away from the actual victims practically immune from the reach of the law, it must feel more like a virtual crime—but one with real rewards.”
But this is not the whole truth. The US Office of the National Counterintelligence Executive recently published a reportabout the support of cybercriminal activities by governments of China and Russia. There are many reasons to believe in close connections between hackers and security services of these countries. December, 4th elections in Russia have proved these statements to be reasonable. DDoS attacks on several opposition and media websites, hundreds of thousands of bots used on Twitter against the meeting of opposition are difficult to explain by patriotic enthusiasm of Russian hackers as well as previous attacks on Internet systems in Georgia and Estonia during diplomatic conflicts between these countries and Russia. There is also evidence that major cybercriminal groups in China are controlled by the government.
What all of this has to do with people happily living in the Western World? Unfortunately, there is no reason to believe that Intelligence services of developed countries are much different from those in China and Russia when we speak about cyberspace. This is why in this battle against cybercrime we, the people, can’t rely on the government to protect us. Italian cyber security expert Pierluigi Paganini writes in his blog Security Affairs: “We are facing with a new generation of weapons, real cyber weapons, silent and really offensive. Viruses are designed by teams of experts and their architecture is so complex that suggests a structured project aimed to surgery offensive. More I read of the results obtained by the research groups more I am convinced that behind the development of such malware there is a government sponsorship.” The most dangerous malware attacks organizations’ network systems or millions of computers globally. It requires teams of experts working together to create and update it as well as well organized distribution channels. It is not written by smart kids in their garages.
The governments’ spending on tools for cyber security has been growing significantly. Financial analysts recommend stocks of companies involved in this business as a smart and profitable investment for the next year. These companies are expected to succeed through any financial crisis feeded by taxpayers’ money. According to the latest report, global spending on cyber warfare will reach US$15.9 billion in 2012, up from an estimated US$12.5 billion this year.
A very big piece of this pie will go to private companies. There are even special trade shows where the developers promote their programs to government representatives. According to Jerry Lucas, president of TeleStrategies Inc., a show's operator, “In recent years a retail market for surveillance tools has sprung up from "nearly zero" in 2001 to about $5 billion a year”. The tools offered at the show provide the clients for example "Remote Monitoring and Infection Solutions”. “Although hacking techniques are generally illegal in the U.S., law enforcement can use them with an appropriate warrant”, Orin Kerr, a professor at George Washington University Law School told to Wall Street Journal. Wikileaks has published a mapwith links to the companies creating these tools.
But as the representatives of the companies confirmed, they are not responsible for the application of the software. And there are multiple cases known when these programs were used in conflict with peoples’ rights. Even when they are employed by government officials, would it make you happier to know that all your intimate data is controlled by FBI instead of FSB? There is a tiny line between using malware to protect citizen and spying on them to control and manipulate the data for non-constitutional or criminal purpose. A hacker infecting thousands of computers must go to prison; but what about an official ordering to insert spyware into millions of computers/phones? The latest scandal involving Carrier IQ, a software installed on more than 100 million phones globally, provides clear evidence that Americans in general (not just criminals) have no privacy rights in eyes of their own government. The program, activated by default on devices of major phones producers, is capable of tracking user locations, keystrokes, encrypted Internet traffic and the information could be sent back to the cell phone service provider or Carrier IQ's servers.
This sounds impossible in the country promoting itself as an example of democracy and a defender of peoples’ rights around the world. Unfortunately, using a war against the world cybercriminals and spies, the officials in DC are trying to take away Americans rights. Talking about the necessity to defend citizens from invisible enemies stealing their data from computers and phones, in reality they are gathering personal information and making personal security much more vulnerable.
The same time they replace real programs designed to protect people and businesses by new bills aiming to control internet usage and to filter the information Americans will receive. The most recent example of this type of “protection” is SOPA bill which is currently in Congress. The authors of the bill are trying to convince public that they are protecting the interests of Americans and improving the security of internet by limiting availability of foreign websites. But most of Internet experts are absolutely disagree. Andrew Lee, CEO ESET North America wrote in the open letter to the Congress: “our experiences combatting cybercrime for more than 20 years suggest that SOPA and PIPA will do little to advance these goals. In short, these bills will be devastating to the Internet and America's leadership in the global digital economy. They will undermine plans to make the Internet more secure and needlessly complicate the fight against cybercrime.”
So what are the options of an ordinary person or business? To follow “the recommendation” of “The Hacker News”: “if you wish not to be monitored by corporations and the government, we politely remind you to stay off the Internet, stop using all proprietary software and hardware, disconnect your cell phone and land line immediately, and ensure a snug fit on your tin foil helmet”. Or to be proactive and to make educated decisions based on knowledge about potential threats. People shouldn’t ignore the reality, but cyberspace consists not just of Trojans, viruses and worms. It also provides unlimited opportunities for business, education, communications and the progress of human society.
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