Ex-security pro admits running huge botnet

A former security researcher admitted to hijacking a quarter of a million PCs

A former security researcher admitted to hijacking a quarter of a million PCs, using spyware to steal bank and PayPal account information, and making money by installing adware on the massive botnet.

John Schiefer, 26, of Los Angles agreed Friday to plead guilty to four felony counts, including accessing protected computers, disclosing illegally intercepted electronic communications, wire fraud and bank fraud. He faces a total of 60 years in prison and fines of US$1.75 million for his part in building and then using the botnet. Several others, named only by their online monikers, were listed as accomplices.

According to Assistant US Attorney Mark Krause, Schiefer, also known as "Acidstorm" and "Acid," was the first to be charged under federal wiretap statutes for using a botnet.

He and his co-schemers infected PCs with malware -- likely Trojan horses, although the court papers didn't specify the malicious code -- that added the compromised systems to a botnet and then stole usernames and passwords stored by Microsoft Corp.'s Internet Explorer browser. IE, like other browsers, will save that information to speed future log-ons. Schiefer mined the data retrieved from the botnet to access multiple PayPal accounts as well as other financial accounts and then plundered them.

Some of the looted PayPal funds were used to pay for more Web-hosting space and bandwidth to continue spreading the malware and adding to the botnet, prosecutors said.

Schiefer and his cohorts -- some of whom were minors -- also installed adware on more than 137,000 of the quarter-million machines in the botnet. The ad-generating software was provided by TopConverting, which at the time was an adware affiliate of a Dutch marketing company, Simpel Internet. TopConverting, also known as Crazywinnings, is now defunct, but as recently as the summer of 2006 it was well known to anti-adware experts, who said it was often installed by unauthorized drive-by downloads.

The gang collected approximately 14 cents per adware installation, or nearly US$20,000, from Simpel, and repeatedly told the Dutch company that the installs were legitimate, according to the government's charges.

Schiefer rode herd not only on the botnet, but also on his accomplices, court documents showed. In June 2005, he chewed out a co-conspirator with the online nickname of "Butthead" because the malware wasn't infecting enough PCs for his liking. The underperforming malware, said Schiefer, was "sketching [him] out."

He also told Butthead to keep the number of malware-infected machines at a consistent number to avoid detection, saying, "Make sur ur running that dl on ur chans so we can keep the stats stable."

Schiefer blasted another accomplice, dubbed "Adam," for worrying about stealing money from the compromised PayPal accounts. Schiefer reminded Adam that he was a minor and then told him he should just "quit being a bitch and claim it."

Schiefer was employed by 3G Communications of Los Angeles as a security consultant until early 2006. He used both work and home computers to oversee the botnet.

An arraignment hearing has been scheduled for December 3 in federal court in Los Angeles.

Join the newsletter!

Or
Error: Please check your email address.
Rocket to Success - Your 10 Tips for Smarter ERP System Selection
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Gregg Keizer

Computerworld
Show Comments

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Andrew Teoh

Brother MFC-L9570CDW Multifunction Printer

Touch screen visibility and operation was great and easy to navigate. Each menu and sub-menu was in an understandable order and category

Louise Coady

Brother MFC-L9570CDW Multifunction Printer

The printer was convenient, produced clear and vibrant images and was very easy to use

Edwina Hargreaves

WD My Cloud Home

I would recommend this device for families and small businesses who want one safe place to store all their important digital content and a way to easily share it with friends, family, business partners, or customers.

Walid Mikhael

Brother QL-820NWB Professional Label Printer

It’s easy to set up, it’s compact and quiet when printing and to top if off, the print quality is excellent. This is hands down the best printer I’ve used for printing labels.

Ben Ramsden

Sharp PN-40TC1 Huddle Board

Brainstorming, innovation, problem solving, and negotiation have all become much more productive and valuable if people can easily collaborate in real time with minimal friction.

Sarah Ieroianni

Brother QL-820NWB Professional Label Printer

The print quality also does not disappoint, it’s clear, bold, doesn’t smudge and the text is perfectly sized.

Featured Content

Product Launch Showcase

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?