Android banking trojan intercepts security texts
Thought you were so clever, Mr Banker Guy
Developers of the SpyEye banking trojan have started bundling it with malware for phones running Google's Android operating system to intercept text messages many financial institutions use to prevent fraud, researchers said.
The trojan known as Spitmo is SpyEye's first in-the-wild malware to target Android, Ayelet Heyman, a researcher for Trusteer, wrote in a blog post  published Tuesday. It's offered to people already infected with the desktop version of SpyEye under the guise that Android phones must install security software to work with a bank's online services. The SMS messages of those who take the bait are then continuously intercepted and sent to a website under the control of the attackers.
Heyman said Trusteer researchers who infiltrated a command and control server that stored the purloined data found evidence that very few people have been infected by the malicious Android app. But its discovery suggests that SpyEye designers are busy augmenting the trojan to get around a key defense many banks have adopted to thwart current generations of password-logging software: the use of one-time pass codes sent by text message to a customer's phone. Trusteer uncovered Spitmo in late July after analyzing a computer that was infected by SpyEye.
SpyEye made its debut in December 2009 in Russian underground forums and has been drawing attention for its sophistication and moxie ever since. In February 2010, it was updated with a "ZeuS killer" feature  that scanned computers it had infected for signs that they were already compromised by rival ZeuS banking trojan. When ZeuS was found, SpyEye removed it.
In January, researchers unearthed evidence that the source code for SpyEye and ZeuS had been merged , signaling competing developers had decided to join forces. More recently, SpyEye was caught tapping Amazon's S3 cloud services  for command-and-control support.
SpyEye's Android component appears similar to a separate "man-in-the-mobile" app the banking trojan used to steal SMS messages from smartphones running the Symbian operating system .
For now, the smartphone components don't appear to be making much headway. But with mainstream websites such as Google and Facebook using smartphone to deliver one-time passwords, it wouldn't be surprising to see a proliferation of malicious apps that perfect the art of stealing SMS messages. ®