When Joe Stewart spotted a variant of the Mocbot Trojan hijacking unpatched Windows machines for use in IRC-controlled botnets, he immediately went to work trying to pinpoint the motive for the attacks.
Stewart, a senior security researcher with LURHQs Threat Intelligence Group, set up a way to silently spy on the botnets command-and-control infrastructure, and his findings suggest that for-profit spammers are clearly winning the cat-and-mouse game against entrenched anti-virus providers.
“The lesson here is once you get infected, you are completely under the control of the botmaster. He can put whatever he wants on your machine, and theres no way to be 100 percent sure that the machine is clean,” Stewart said in an interview with eWEEK.
Stewart, a well-respected researcher who specializes in reverse-engineering malware files, echoed a warning issued earlier this year by Microsoft.
“The only way to be [completely] sure the system is malware-free is to completely wipe the hard drive and reinstall the operating system,” he said.
Stewart arrived at that conclusion after eavesdropping on Mocbot for a few hours.
“I have two machines here running in an isolated network. I infect one with the malware, and I have the other machine pretending to be the entire Internet,” he explained.
The second machine, known as a sandnet, is a custom-made tool for analyzing malware in an environment that is isolated, yet provides a virtual Internet for the malware to interact with.
“I can sit back and see all the interaction up to point where it [the infected machine] joins botnets control channel. Then I can take that information, go outside and replicate it. I can see what the real server is doing to get an entire picture of the operation,” Stewart said.
With Mocbot, which was targeting the Windows vulnerability patched with Microsofts MS06-040 patch, Stewart was able to figure out that the infected drones were connecting to two hard-coded command and control servers at “bniu.househot.com” and “ypgw.wallloan.com.”
He was able to capture the IRC (Internet Relay Chat) login sequence generated by the bot. This included a user, a nickname, the channel name and the first bit of instructions to the infected machine.
The command schemes were all encrypted, forcing Stewart to create a custom Perl script to decode the algorithms.
“Theyre using trivial encryption, so a bit of reverse-engineering had to be done. You can see some of it in the code of Mocbot, and I wrote a little script to do the decoding. When I visit the channel and he gives a command, I can easily decrypt it to see the instructions hes sending to the bot,” Stewart said.
Using telnet to connect to the command-and-control server on Port 18067 (the port number for the IRC server), Stewart successfully started spying on the control channel, but there was not much to see.
“The IRC server code was stripped down to give almost no information to the client, except the channel topic line, which was encrypted,” he said.
Once decoded, he found that the botmaster was telling the infected machines to join another control channel to receive another encrypted message.
When decoded, the command simply served up a URL hosted at PixPond.com, a free image hosting service.
“The command is an instruction to download and execute [a second] file in the provided URL,” Stewart said, noting that the mission of the botmaster was to get the second file into the infected system.
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The file is a spam proxy Trojan named Win32.Ranky.fv.
“The entire scheme of mass infection is simply to facilitate the sending of spam. The proxy Trojan is also a bot of sorts; reporting in to a master controller to report its IP address and the SOCKS port for use in the spam operation,” Stewart said.
With the spam proxy Trojan sitting on his test machine, Stewart was again able to join the spam proxy net to get an internal peek at the operations.
Using the sandnet, he found that the Trojan was sending a 4-byte UDP packet to the “yu.haxx.biz” address.
Stewart then mimicked this on an Internet connected network with a fake SOCKS proxy that feeds into a blackhole SMTP server to infiltrate the proxy network.
He immediately started seeing “loads of spam being pumped through our SOCKS server.” This was coming from dozens of IP addresses and using forged sender addresses.
The spam e-mails, which are now being pumped from infected Windows desktops, represented a range of the typical junk mail, Stewart said.
He found mail advertising everything from pornography to fake Rolex watches and pharmaceuticals.
“It looks like this was a small, targeted attack for one simple reason. They wanted to stay under the radar. This is all about setting up small botnets and making money from spam. They could be the spammers themselves or the guys doing the dirty work and then renting the botnets to spammers,” he said.
“This is a business model that is obviously working. They wouldnt be going to these lengths if it wasnt making money,” Stewart added.
The LURHQ researcher says the recent attack proves that businesses and consumers should be careful about depending on existing anti-virus software.
In the initial stages of the Mocbot attack, only one-third of anti-virus scanners tested by Stewarts research team were detecting the malware.
“This was just a minor variant of something that was out there for months but the majority of scanners were missing it,” he said.
Even more worrisome is the fact that the attack included the use of botnet instructions to download the second-stage Trojan executable.
“In this case, it was a spam proxy Trojan, but what if it was a rootkit? The rookits are getting so good these days that the programs we typically rely on to find and clean machines just cant see them. There is still the possibility that the spammers could slip in a rootkit to hide things forever,” he said.
“Its getting to the point where you might want to consider just rebuilding and reformatting machines after these attacks. If your security software doesnt spy on the botnet and know exactly what is being dumped on the machine, the malware can go undetected for a long time,” Stewart said.
The lesson? “Dont get infected in the first place,” Stewart said. He urged IT administrators to apply critical patches early and maintain several levels of defense against malware, including firewalls, anti-virus and system hardening.