A new report uncovers a sophisticated Russian market for Android malware driven by startup-like houses which peddle their wares to a vibrant ecosystem of distributors.
Perhaps the only good news for non-Russian speaking consumers in a new report by US mobile security firm Lookout is that the bulk of Android malware targets Russian Android users. Russian-built SMS-fraud malware for Google’s Android platform now account for more than half of all samples collected by the popular mobile security firm.
The company’s “Dragon Lady” report on Russian-made malware traces the burgeoning industry back to 10 core “malware headquarters”, which create malware-as-a-service offerings that are sold to a network of affiliate marketers who can earn between $700 per month to $12,000 per month for scams that fraudulently charge victims for premium SMS messages they never intended to send.
The Russian malware factories are responsible for 60 percent of Russian Android malware the firm has observed in the wild, which includes the BadNews malware that employed a fraudulent ad network to hide threats in dozens of apps that were distributed through Google Play.
Around 30 seemingly innocuous apps laced with BadNews were hastily removed by Google after reports earlier this year that they were rigged to serve ads that linked to SMS fraud malware. According to Lookout, these sites were hosted by Russia’s top mobile malware makers.
The malware suppliers took on backend services that allowed less technically adept affiliates to customise the product and focus on shuffling victims through the door. According to Lookout, top suppliers even gamified rewards to improve collection rates.
Other pre-packaged services included regular software updates, pre-registered SMS short codes and distribution of funds. Suppliers also kept affiliates on a technical leash and unable to download and distribute the malware independently.
“[The affiliate] must direct each victim to a service operated by the Malware HQ which will build a unique malware application “on the fly” once a download request is made,” Lookout notes.
The task of distribution though is left to a network of affiliate marketers who take a cut of gains from increased infections. While marketplaces like Google Play are used, the major distribution network was Twitter, according to Lookout.
Analysing 247,000 Twitter handles, Lookout’s researchers confirmed 50,000 Twitter accounts linked to malware and many of these did not use a unique profile image, but instead had the stock egg image.
Affiliates would also handle “landing pages”, designed to lure victims into installing a malicious app by falsely advertising more popular apps, like Angry Birds, Skype, Opera or Flash updates.
According to Lookout, Android malware makers in Russia are “similar to agile software development organisations” and release new code every few weeks. Like desktop malware makers, they’re also employing techniques to disrupt detection and discovery.