Page 3 of 24
The US has returned $154 million in bitcoins stolen by a Sony employee.
However, on December 1, following an investigation in collaboration with Japanese law enforcement authorities, the FBI seized the 3879.16242937 BTC in Ishii’s wallet after obtaining the private key, which made it possible to transfer all the bitcoins to the FBI’s bitcoin wallet.
A January 2021 FBI document outlines what types of data and metadata can be lawfully obtained by the FBI from messaging apps. Rolling Stone broke the story and it’s been written about elsewhere.
I don’t see a lot of surprises in the document. Lots of apps leak all sorts of metadata: iMessage and WhatsApp seem to be the worst. Signal protects the most metadata. End-to-end encrypted message content can be available if the user uploads it to an unencrypted backup server.
EDITED TO ADD (12/13): Here’s a more legible copy of the text.
The FBI has issued a bulletin describing a bitcoin variant of a wire fraud scam:
As the agency describes it, the scammer will contact their victim and somehow convince them that they need to send money, either with promises of love, further riches, or by impersonating an actual institution like a bank or utility company. After the mark is convinced, the scammer will have them get cash (sometimes out of investment or retirement accounts), and head to an ATM that sells cryptocurrencies and supports reading QR codes. Once the victim’s there, they’ll scan a QR code that the scammer sent them, which will tell the machine to send any crypto purchased to the scammer’s address. Just like that, the victim loses their money, and the scammer has successfully exploited them.
[…]
The “upgrade” (as it were) for scammers with the crypto ATM method is two-fold: it can be less friction than sending a wire transfer, and at the end the scammer has cryptocurrency instead of fiat. With wire transfers, you have to fill out a form, and you may give that form to an actual person (who could potentially vibe check you). Using the ATM method, there’s less time to reflect on the fact that you’re about to send money to a stranger. And, if you’re a criminal trying to get your hands on Bitcoin, you won’t have to teach your targets how to buy coins on the internet and transfer them to another wallet—they probably already know how to use an ATM and scan a QR code.
Vice has a detailed article about how the FBI gets data from cell phone providers like AT&T, T-Mobile, and Verizon, based on a leaked (I think) 2019 139-page presentation.
EDITED TO ADD (11/12): My mistake. It was not a leak:
Ryan Shapiro, executive director of nonprofit organization Property of the People, shared the document with Motherboard after obtaining it through a public record act request. Property of the People focuses on obtaining and publishing government records.
The Washington Post reports that the FBI had a decryption key for the REvil ransomware, but didn’t pass it along to victims because it would have disrupted an ongoing operation.
The key was obtained through access to the servers of the Russia-based criminal gang behind the July attack. Deploying it immediately could have helped the victims, including schools and hospitals, avoid what analysts estimate was millions of dollars in recovery costs.
But the FBI held on to the key, with the agreement of other agencies, in part because it was planning to carry out an operation to disrupt the hackers, a group known as REvil, and the bureau did not want to tip them off. Also, a government assessment found the harm was not as severe as initially feared.
Fighting ransomware is filled with security trade-offs. This is one I had not previously considered.
Another news story.
Motherboard got its hands on one of those Anom phones that were really FBI honeypots.
The details are interesting.
For three years, the Federal Bureau of Investigation and the Australian Federal Police owned and operated a commercial encrypted phone app, called AN0M, that was used by organized crime around the world. Of course, the police were able to read everything—I don’t even know if this qualifies as a backdoor. This week, the world’s police organizations announced 800 arrests based on text messages sent over the app. We’ve seen law enforcement take over encrypted apps before: for example, EncroChat. This operation, code-named Trojan Shield, is the first time law enforcement managed an app from the beginning.
If there is any moral to this, it’s one that all of my blog readers should already know: trust is essential to security. And the number of people you need to trust is larger than you might originally think. For an app to be secure, you need to trust the hardware, the operating system, the software, the update mechanism, the login mechanism, and on and on and on. If one of those is untrustworthy, the whole system is insecure.
It’s the same reason blockchain-based currencies are so insecure, even if the cryptography is sound.
The person behind the Bitcoin Fog was identified and arrested. Bitcoin Fog was an anonymization service: for a fee, it mixed a bunch of people’s bitcoins up so that it was hard to figure out where any individual coins came from. It ran for ten years.
Identifying the person behind Bitcoin Fog serves as an illustrative example of how hard it is to be anonymous online in the face of a competent police investigation:
Most remarkable, however, is the IRS’s account of tracking down Sterlingov using the very same sort of blockchain analysis that his own service was meant to defeat. The complaint outlines how Sterlingov allegedly paid for the server hosting of Bitcoin Fog at one point in 2011 using the now-defunct digital currency Liberty Reserve. It goes on to show the blockchain evidence that identifies Sterlingov’s purchase of that Liberty Reserve currency with bitcoins: He first exchanged euros for the bitcoins on the early cryptocurrency exchange Mt. Gox, then moved those bitcoins through several subsequent addresses, and finally traded them on another currency exchange for the Liberty Reserve funds he’d use to set up Bitcoin Fog’s domain.
Based on tracing those financial transactions, the IRS says, it then identified Mt. Gox accounts that used Sterlingov’s home address and phone number, and even a Google account that included a Russian-language document on its Google Drive offering instructions for how to obscure Bitcoin payments. That document described exactly the steps Sterlingov allegedly took to buy the Liberty Reserve funds he’d used.
The Washington Post has published a long story on the unlocking of the San Bernardino Terrorist’s iPhone 5C in 2016. We all thought it was an Israeli company called Cellebrite. It was actually an Australian company called Azimuth Security.
Azimuth specialized in finding significant vulnerabilities. Dowd, a former IBM X-Force researcher whom one peer called “the Mozart of exploit design,” had found one in open-source code from Mozilla that Apple used to permit accessories to be plugged into an iPhone’s lightning port, according to the person.
[…]
Using the flaw Dowd found, Wang, based in Portland, Ore., created an exploit that enabled initial access to the phone a foot in the door. Then he hitched it to another exploit that permitted greater maneuverability, according to the people. And then he linked that to a final exploit that another Azimuth researcher had already created for iPhones, giving him full control over the phone’s core processor the brains of the device. From there, he wrote software that rapidly tried all combinations of the passcode, bypassing other features, such as the one that erased data after 10 incorrect tries.
Apple is suing various companies over this sort of thing. The article goes into the details.
In January, we learned about a Chinese espionage campaign that exploited four zero-days in Microsoft Exchange. One of the characteristics of the campaign, in the later days when the Chinese probably realized that the vulnerabilities would soon be fixed, was to install a web shell in compromised networks that would give them subsequent remote access. Even if the vulnerabilities were patched, the shell would remain until the network operators removed it.
Now, months later, many of those shells are still in place. And they’re being used by criminal hackers as well.
On Tuesday, the FBI announced that it successfully received a court order to remove “hundreds” of these web shells from networks in the US.
This is nothing short of extraordinary, and I can think of no real-world parallel. It’s kind of like if a criminal organization infiltrated a door-lock company and surreptitiously added a master passkey feature, and then customers bought and installed those locks. And then if the FBI got a court order to fix all the locks to remove the master passkey capability. And it’s kind of not like that. In any case, it’s not what we normally think of when we think of a warrant. The links above have details, but I would like a legal scholar to weigh in on the implications of this.
Sidebar photo of Bruce Schneier by Joe MacInnis.