CryptoLocker gang casts tentacles into botnet crime world

The cyber-gang running the CryptoLocker extortion racket is sharing a big cut of any payments they squeeze out of their victims with criminal botnet owners working closely with them, says Symantec, which has been monitoring this underworld activity online.

The CryptoLocker gang, believed to be mainly Russian-speaking, created the malware that makes use of strong encryption to lock up the victim's electronic files until the victim pays a ransom, which typically starts at least $150 to get the key to unlock their scrambled files. The gang itself is paying criminal botnet owners operating vast command-and-control systems of compromised computers to distribute CryptoLocker as a dangerous attachment in spam, says Liam O'Murchu, manager of security response operations at Symantec. In addition to spam distribution, which relies on the victim opening the malware-laden attachment to spread CryptoLocker, the gang is willing to pay a botnet owner as much as 75% of any extortion money they can get from victims if the botnet owner directly drops CryptoLocker onto a compromised machine it already controls.

[RELATED:Businesses offer best practices for escaping CryptoLocker hell]

Doing that basically scores a direct hit for CryptoLocker but can be counted as a loss of a compromised computer for botnet owners, hence the willingness to share such a high percentage of the monetary gain netted from any victim, O'Murchu says. "They're making a lot of money," and victims are expected to pay in Bitcoin or MoneyPak.

The Swansea, Mass., Police department even paid up a reported $750 for a pair of Bitcoins to get its files back recently. Since it encrypts files and makes them wholly inaccessible, CryptoLocker, first noticed in the September timeframe, is getting wide attention wherever it strikes. The University of Kentucky, for instance, just put out a campus alert warning it had seen victims there, and urging anyone whose computer is taken over by CryptoLocker to call the IT department immediately.

In most cases, there's not  much the  IT department can do except isolate the infected computer and wipe it.

One IT manager, speaking not for attribution, explained how his department handled a CryptoLocker infection on an employee's computer. "We remove the infected laptop from the network and shut down the share.  The laptop is reimaged and the share file structure is copied to a device, the encrypted files are deleted from the copy, we don't risk restoring the entire contents of the copy. We restore the share from the previous evening's backup." He added: "If someone is really in need of a file from the copy, and that file was not one that was encrypted, we will restore that one file."

O'Murchu says there's no guarantee that anyone willing to pay the CryptoLocker blackmail will actually get the encryption key from the gang, and that the preferred response would be to regain files through a very reliable back-up system. A number of businesses hit by CryptoLocker recently have said reliable data back-up was the only way they restored their computer files.

O'Murchu acknowledges that CryptoLocker is quite devious, using every trick available to evade anti-malware, and that an anti-malware vendor like Symantec is faced with continuously updating detection to hold CryptoLocker at bay. Nevertheless, the actual success rate of infection from CryptoLocker may not actually been that high so far, as measured by Symantec as in the .04% success rate range. But for victims, that's not much consolation since there is no way to decrypt their locked-up files. CryptoLocker isn't known to be deleting files.

Symantec has been tracking some of the gang's activity and believes many of the same players that were involved in the well-known "fake A/V" scams of about five years ago are involved in CryptoLocker now.


The "fake A/V" scams told victims their computers were infected and they should pay to "clean" their machines, which were actually infected by "fake A/V" malware. But raising awareness about this, and a concerted effort by industry to cut off the criminals' ability to process payment cards, basically brought an end to these "Fake A/V" cons, says O'Murchu.  But Symantec suspects the criminals involved in "fake A/V" then turned their attention to developing encryption-based ransomware, and in that regard upped the ante considerably.

One group of cyber-criminals, Russian-speaking, made a mistake two years ago when they targeted Russians with crypto-based extortion and were quickly arrested by Russian authorities, O'Murchu notes. The wave of CryptoLocker malware today is almost exclusively targeted at English-language speakers in the U.S., according to several anti-malware firms.

CryptoLocker is flying into e-mail boxes under the usual spam guises, ready as an attachment to be opened by an unsuspecting victim for purposes of ransomware. But the problem could actually get much worse. Today, CryptoLocker spreads in a somewhat plodding fashion through a network unwittingly assisted by gullible victims. If the gang decides to blast out CryptoLocker through scanning techniques, as happened with the well-known Blaster worm of years ago, you might find a CryptoLocker epidemic. But that may not happen because the CryptoLocker gang wants to keep firm control over its malware spread in order to harvest extortion payments from victims willing to cough up some Bitcoin and optimize the botnet-driven operation.

Ellen Messmer is senior editor at Network World, an IDG publication and website, where she covers news and technology trends related to information security. Twitter: MessmerE. E-mail:

Read more about wide area network in Network World's Wide Area Network section.

Join the CSO newsletter!

Error: Please check your email address.

Tags symantecsecuritylegalanti-malwareWide Area Networkcybercrime

More about IDGSymantec

Show Comments

Featured Whitepapers

Editor's Recommendations

Solution Centres

Stories by Ellen Messmer

Latest Videos

  • 150x50

    CSO Webinar: The Human Factor - Your people are your biggest security weakness

    ​Speakers: David Lacey, Researcher and former CISO Royal Mail David Turner - Global Risk Management Expert Mark Guntrip - Group Manager, Email Protection, Proofpoint

    Play Video

  • 150x50

    CSO Webinar: Current ransomware defences are failing – but machine learning can drive a more proactive solution

    Speakers • Ty Miller, Director, Threat Intelligence • Mark Gregory, Leader, Network Engineering Research Group, RMIT • Jeff Lanza, Retired FBI Agent (USA) • Andy Solterbeck, VP Asia Pacific, Cylance • David Braue, CSO MC/Moderator What to expect: ​Hear from industry experts on the local and global ransomware threat landscape. Explore a new approach to dealing with ransomware using machine-learning techniques and by thinking about the problem in a fundamentally different way. Apply techniques for gathering insight into ransomware behaviour and find out what elements must go into a truly effective ransomware defence. Get a first-hand look at how ransomware actually works in practice, and how machine-learning techniques can pick up on its activities long before your employees do.

    Play Video

  • 150x50

    CSO Webinar: Get real about metadata to avoid a false sense of security

    Speakers: • Anthony Caruana – CSO MC and moderator • Ian Farquhar, Worldwide Virtual Security Team Lead, Gigamon • John Lindsay, Former CTO, iiNet • Skeeve Stevens, Futurist, Future Sumo • David Vaile - Vice chair of APF, Co-Convenor of the Cyberspace Law And Policy Community, UNSW Law Faculty This webinar covers: - A 101 on metadata - what it is and how to use it - Insight into a typical attack, what happens and what we would find when looking into the metadata - How to collect metadata, use this to detect attacks and get greater insight into how you can use this to protect your organisation - Learn how much raw data and metadata to retain and how long for - Get a reality check on how you're using your metadata and if this is enough to secure your organisation

    Play Video

  • 150x50

    CSO Webinar: How banking trojans work and how you can stop them

    CSO Webinar: How banking trojans work and how you can stop them Featuring: • John Baird, Director of Global Technology Production, Deutsche Bank • Samantha Macleod, GM Cyber Security, ME Bank • Sherrod DeGrippo, Director of Emerging Threats, Proofpoint (USA)

    Play Video

  • 150x50

    IDG Live Webinar:The right collaboration strategy will help your business take flight

    Speakers - Mike Harris, Engineering Services Manager, Jetstar - Christopher Johnson, IT Director APAC, 20th Century Fox - Brent Maxwell, Director of Information Systems, THE ICONIC - IDG MC/Moderator Anthony Caruana

    Play Video

More videos

Blog Posts