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05 Oct 2006

Online Russian blackmail gang jailed for extorting $4m from gambling websites

8 years for gang who blackmailed British companies

Hackers use compromised zombie computers to launch denial of service attacks. Image copyright (c) Sophos
Hackers use compromised zombie computers to launch denial of service attacks.

Experts at SophosLabs™, Sophos's global network of virus, spyware and spam analysis centers, have welcomed news reports that authorities in Russia have jailed a gang who blackmailed online companies through distributed denial-of-service (DDoS) attacks.

The gang is said to have extorted more than $4 million from British companies after threatening to attack their websites, making them inaccessible to the outside world. Online casinos and betting websites were targeted by the group, who used compromised zombie computers to launch the denial-of-service attacks.

Ivan Maksakov, Alexander Petrov, and Denis Stepanov were each sentenced to 8 years in prison and a $3,700 fine.

Victims of the online blackmail gang included Canbet Sports Bookmakers, who refused to pay a $10,000 ransom demand and found their website had been taken out of action by the hackers during the Breeders' Cup Races, losing them more than $200,000 in lost business for every day of downtime.

According to prosecutors, the gang made over 50 similar blackmail attacks in 30 different countries during their six months of activity.

"Malicious DDoS attacks on commercial websites can cause serious financial damage to the businesses affected, and are a major nuisance to internet users," said Graham Cluley, senior technology consultant at Sophos. "These sentences should send a strong message to other internet hackers considering online blackmail that they can expect stiff sentences if caught. However, many gangs may believe that the relative anonymity of the internet gives them carte blanche to carry on. All computer users should ensure that they have secure defenses in place to protect against abuse like this."

Russian authorities worked with the UK National High Tech Crime Unit, Interpol, and FBI worked together to apprehend the gang.

"News like this should encourage companies who are the victims of attempted blackmail over the net that they shouldn't pay up, but instead report the crime to the relevant authorities," continued Cluley. "Businesses who pay up are only encouraging hackers to try and extort more money in future."

Zombie computers - are your PCs under someone else's control?

Zombie computers can be used by criminal hackers to launch distributed denial-of-service attacks, spread spam messages or to steal confidential information. SophosLabs estimates that more than 60 percent of all spam today originates from zombie computers.

As spammers become more aggressive, collaborating with virus writers to create armies of zombie computers, legitimate organizations with hijacked computers are being identified as a source of spam. This not only harms the organization's reputation, but can also cause the company's email to be blocked by others.

Sophos ZombieAlert™ advises service subscribers when any computer on their network is found to have sent spam to Sophos's extensive global network of spam traps, and provides rapid notification to customers if their Internet Protocol (IP) addresses are listed in public Domain Name Server Block Lists (DNSBL). This information helps customers locate, disinfect, and protect these systems from future attacks.

Sophos continues to recommend that computer users ensure their anti-virus software is up-to-date, and that companies protect themselves with a consolidated solution which can defend them from the threats of viruses, spyware and spam.

About Sophos

More than 100 million users in 150 countries rely on Sophos as the best protection against complex threats and data loss. Sophos is committed to providing complete security solutions that are simple to deploy, manage, and use and that deliver the industry's lowest total cost of ownership. Sophos offers award-winning encryption, endpoint security, web, email, mobile and network security solutions backed by SophosLabs - a global network of threat intelligence centers.

Sophos is headquartered in Boston, US and Oxford, UK. More information is available at www.sophos.com.