The newest generation of banking Trojans is now equipped with ransomware, creating a hybrid malware. The primary function of banking Trojans is still to collect login credentials for banking portals and instant messaging applications. However, with the addition of ransomware, cybercriminals are increasing the odds that they collect on every device that has been infected.
Mobile Banking Trojans
If you own a smartphone, it’s very likely you also have a bank card. Since banks use mobile phone numbers for authorization, it makes sense for cybercriminals to penetrate this channel of communication to execute payments and transfers from your account. Banking Trojans are the most prominent mobile threat, constituting over 95% of mobile malware. Over 98% of mobile banking Trojan attacks target Android devices, which should also come as no surprise, as Android is the most popular platform for mobile devices.
How do cybercriminals infiltrate Android devices with banking Trojans? Trojans are less dangerous than viruses because they require action on the user’s end, however, through social engineering, cybercriminals lure users into performing such actions. Trojans can mimic applications and prompt the user to run an important update or activate a bonus level for your favorite game. Exploits are also able to run the malware automatically, once the user accidently executes the malicious file. Once the malware is installed, there are three major methods that banking Trojans employ:
- Hiding Text Messages: Malware on phones hides incoming SMS from banks and then sends them to cybercriminals who then proceed to transfer money to their accounts.
- Small Cash Movements: Cybercriminals will occasionally transfer relevantly small amounts of money to fraudulent accounts from an infected user’s account, hoping it won’t be noticed so that they can continue to do so.
- App Mirroring: Malware mimics a bank’s mobile application and gathers login credentials on the infected device. Once the credentials are gathered, cybercriminals are able to perform the two actions above.
Banking Trojans with Ransomware
Not all users who have been infected with an Android banking Trojan use banking applications, which is where the ransomware features come into play. The ransomware essentially acts as a backup plan for cybercriminals to increase their chances of extracting some form of payment from their victims.
Android.SmsSpy, Fanta SDK, and Svpeng are the first banking trojans to add ransomware-like features to their malware; locking user’s screen with a random PIN. This feature is to keep users busy while cybercriminals initiate fraudulent transactions. While the user is trying to figure out how to unlock their phone, hackers hope the victim will be too busy to see the text or email alerts they receive for large or fraudulent transactions that take place on their bank account. This gives cybercriminals hours, or even days, to transfer the stolen money to different bank accounts and withdraw the money from ATMs. By the time it’s discovered, police will be unable to identify the criminals as the money has likely been transferred through several fake bank accounts before being cashed out.
Faketoken and Tordow 2.0
Faketoken and Tordow 2.0 are the first to fully implement ransomware into their banking Trojans. Faketoken’s primary function is to generate fake login screens for more than 2,000 financial applications in order to steal login credentials. Creators of Faketoken have now added the capability to encrypt user files stored on the phone’s SD card. Once the relevant command is received, the Trojan compiles a list of files located on the device and encrypts them.
Tordow 2.0 can make phone calls, control text messages, download and install programs, steal login credentials, access contacts, visit web pages, manipulate banking data, remove security software, reboot devices, rename files, encrypt files, and act as ransomware. To date, Tordow 2.0 has infected 16,000 devices in 27 countries with most of them located in Russia, Ukraine, Germany, and Thailand.
Once infected with the ransomware feature, victims will see something similar to the image below appear on their screens.
With the fully integrated ransomware feature, cybercriminals are targeting the least technical savvy users possible. If you think about it, encrypting files on a mobile device is essentially pointless. The point of ransomware is to encrypt files on a device and demand a ransom to get the decryption key. However, many files stored on mobile devices are backed up by cloud services. Therefore, users who have been infected could easily wipe their phone clean and download all their files from the cloud service they use. If they haven’t backed up for awhile, data may be lost, but it typically wouldn’t be anything of great value.
It’s still very early in the development stages of banking Trojans being paired with ransomware. Thus, the encryption of files is likely to have the same purpose of locking users’ screens which is to give cybercriminals time to perform fraudulent transfers before users can figure out how to restore their mobile phones.
We recommend that Android users only install applications from the official Google Play store and should make sure that their phones don’t allow the installation of applications from unknown sources. Lastly, it’s a good idea to read user reviews and only download highly rated applications.