Hackers’ bazaar as cyber markets grow increasingly sophisticated and resilient

Black and grey markets for computer hacking tools, services and byproducts such as stolen credit card numbers continue to expand, creating an increasing threat to businesses, governments and individuals, according to a new study.

Apr 9, 2014
By Paul Jacques
PCC Donna Jones

One dramatic example highlighted in the study by RAND Corporation, Markets for Cybercrime Tools and Stolen Data: Hackers’ Bazaar, is the December 2013 breach of retail giant Target, in which data from approximately 40 million credit cards and 70 million user accounts was hijacked. Within days, that data appeared – available for purchase – on black market websites.

“Hacking used to be an activity that was mainly carried out by individuals working alone, but over the past 15 years the world of hacking has become more organised and reliable,” said Lillian Ablon, lead author of the study and an information systems analyst at RAND, a non-profit research organisation. “In certain respects, cybercrime can be more lucrative and easier to carry out than the illegal drug trade.”

These networks of highly organised cybercrime groups are often connected with traditional crime groups, such as drug cartels, mafia and terrorist cells, and nation-states.

The report says the cyber black market does not differ much from a traditional market or other typical criminal enterprises; participants communicate through various channels, place their orders and get products.

Its evolution mirrors the normal evolution of markets with both innovation and growth.

The growth in cybercrime has been assisted by sophisticated and specialist markets that freely deal in the tools and the spoils of cybercrime. These include items such as exploit kits (software tools that can help create, distribute and manage attacks on systems), botnets (a group of compromised computers remotely controlled by a central authority that can be used to send spam or flood websites), as-a-service models (hacking for hire) and the fruits of cybercrime, including stolen credit card numbers and compromised hosts.

In the wake of several highly-publicised arrests and an increase in the ability of law enforcement to take down some markets, access to many of these black markets has become more restricted, with cybercriminals vetting potential partners before offering access to the upper levels. That said, once in, there is very low barrier to entry to participate and profit, according to the report.

RAND researchers conducted more than two-dozen interviews with cybersecurity and related experts, including academics, security researchers, news reporters, security vendors and law enforcement officials. The study outlines the characteristics of the cybercrime black markets, with additional consideration given to botnets and their role in the black market, and ‘zero-day’ vulnerabilities (software bugs that are unknown to vendors and without a software patch). Researchers also examined various projections and predictions for how the black market may evolve.

What makes these black markets notable is their resilience and sophistication, Ms Ablon said. Even as consumers and businesses have fortified their activities in reaction to security threats, cybercriminals have adapted.

However, she says law enforcement efforts are improving as more officers become technologically savvy. An increase in arrests has resulted in hackers going after bigger targets, and thus attracting more attention. More crimes involve a digital component, giving police more opportunities to encounter crime in cyberspace.

The RAND study says there will be more activity in ‘darknets’ (closed private networks), more checking and vetting of participants, more use of crypto-currencies such as Bitcoin, greater anonymity capabilities in malware and more attention to encrypting and protecting communications and transactions. Helped by such markets, the ability to attack will likely outpace the ability to defend.

Hyper-connectivity will create more points of presence for attack and exploitation so that crime increasingly will have a networked or cyber component, creating a wider range of opportunities for black markets, says the report. Exploitation of social networks and mobile devices will continue to grow. There will be more hacking-for-hire, as-a-service offerings and cybercrime brokers.

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