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International data theft ring busted

by on07 August 2008


Stole credit info by Wardriving

The U.S.
Department of Justice says it has broken a major international hacking ring that stole more than 40 million consumers’ credit and debit card information. The stolen data came from hacking a number of U.S. retailers, the largest number from retailer T.J. Maxx.

Also hacked were the networks of Sports Authority, Barnes & Noble, Boston Market, BJ's Wholesale Club, OfficeMax, Boston Market, Forever21 and DSW. Eleven people have been charged, including three people from the U.S., two from P.R.C., one from Belarus and one from Estonia. While the D.O.J. believes it has caught the ring leader, there are believed to be other members of the ring that have not been apprehended.

The method of theft is disconcerting: the D.O.J. says that the hackers obtained the credit and debit card numbers by "wardriving," or simply driving around and testing wireless computer networks for vulnerabilities, then hacking into them. 

Once the networks were hacked into, sniffer programs were installed that captured credit and debit card numbers, along with password and account information as the data was being processed.

The D.O.J. indictment indicated that after the information was collected members hid the data in encrypted servers in the U.S. and Eastern Europe. They then sold off some of the information across the Internet to others, which in turn allowed them to create phony credit cards with the information and to steal funds from in thousands of dollars at a time. The ring successfully laundered the funds by using Internet-based currencies in the U.S. and internationally and by funneling funds through Eastern Europe bank accounts.

T.J. Maxx/TJX systems were hardest hit, as it was using Wireless Encryption Protocol (WEP) to encrypt its data transactions, a very insecure type of encryption. The hackers became so familiar with the TJX system that they reportedly left each other encrypted messages in the TJX network to let each other know which files had been copied.

The real question is why these major companies still are using networks that are not adequately secure. If data can be stolen by someone simply driving around outside someone’s building, then there is a problem. Kind of makes you want to pay with cash at all times.

Last modified on 07 August 2008
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