Original URL: http://www.theregister.co.uk/2006/12/28/net_con/
How the net changed the ancient art of the con
The art of deception
Comment It's called a confidence game. Why? Because you give me your confidence? No. Because I give you mine, House of Games
As well as creating new forms of criminal activity, such as spamming, the rising importance of computer networks has witnessed many forms of traditional crime reappearing under slightly different guises.
Blackmail and protection rackets have been reapplied in denial of service attacks targeted against, for example, online bookmakers. Similarly, the traditional crime of stalking becomes cyberstalking when applied through computer and telecoms networks.
But it's perhaps the practice of the confidence trick that has undergone the most change through the application of computer systems. Attempts to mislead prospective marks or victims with the goal of financial profit have been changed because of the reach of computer networks and because face to face interaction is no longer needed to (at least) initiate scams.
You can't con an honest man
Many cyber-scams rely on the greed and dishonesty of their prospective victims. But, arguably, the most prevalent form of cyber-fraud trades on a different human emotion - fear. Phishing fraudsters send messages that pose as a security warning from a legitimate organisation to trick users into visiting bogus websites and handing over sensitive account credentials.
Once they have this information, fraudsters still have the problem of moving money abroad, hence their attempts to recruit so-called phishing mules to act as intermediaries. These middlemen are persuaded to open up bank accounts into which the stolen money is placed. Cash is then transferred minus a "commission", typically seven per cent, to fraudsters - an activity that is itself a criminal offence.
Return to sender
Other scams rely on exploiting a lack of knowledge about banking systems. One common scam involves paying for an item bought online or through an action with a cheque valued at a higher amount than the sum owed. The victim is urged to forward the excess value to the scammer and does so after the cheque is credited to his account, only to find out days later that he's been conned when the cheque bounces.
In other forms of fraud, such as 419 advanced fee fraud, confidence tricksters work with teams of accomplices (or shills) to attempt to trick users that they stand to earn a share of plundered booty. Problems inevitably intervene in extracting this loot (necessitating the mark into shelling out money up front to pay bribes, fee etc.) that escalate as the fraud progresses. A low-rent variation of the theme is the lottery fraud where the prospective victim is informed they have "won" a large prize but must pay an administrative fee before they get their hands on the non-existent loot.
Internet technologies such as email mean the need to target specific marks is no longer of much importance in either phishing or advance-fee fraud attacks. Fraudsters can thrive on response rates as low as one in a million. That also means average punters are exposed on a routine basis to fraudulent overtures.
This in turn has stimulated the emergence of 419-baiters, people who pose as dupes in a bid to out-cheat con artists or to simply waste their time so they're less likely to find gullible marks.
In popular culture, such as films like The Sting, this interaction (through set-up, hook, tale and sting) is playing out face to face for dramatic effect. In cyberspace, 419-baiters chronicle how they lead fraudsters on a merry dance on various websites (such as this), to no less entertaining effect. Our particular favourite is how scam-baiter "Shiver Metimbers" managed to persuade a hapless fraudster into carving a wooden Commodore 64 keyboard in the hopes it might lead to a generous scholarship.
From Russia without love
Fraudsters sometimes cultivate a different approach online by trying to hook prospective marks frequenting dating websites. After cultivating a relationship, grifters claim they are unable to leave their home country and need to borrow money to visit their sweetheart. Naturally, the scammer never makes the trip and the victim is left broken-hearted, and broke.
One common form of get-rich-quick scam email involves so-called pump and dump scams. Crooks seek to inflate interest in a low-value stock on the back of bogus insider information in the hopes of selling the stock on a high before the inevitable crash and burn.
Malware authors have also begun dabbling in confidence tricks. A scam called the badger game - where a married mark is tricked into a compromised position with another woman and threatened with exposure unless extortion demands are played - has been reapplied in cyberspace.
Browser hijacking programs might leave indications of visits to porn websites on compromised PCs and we've heard of a handful of cases where victims are threatened that their actions will be reported to the police unless they hand over the booty. More commonly, threats that users' systems are been monitored by the authorities are tricks designed to fool users into opening record files (actually malware executables) or visiting maliciously constructed websites.
Any pretext will do
Cyber ruses and deception are not always for financial gain. Social engineering techniques, similar to those used in fraud, can manipulate people into performing actions (such as disclosing confidential information) at the behest of an attacker, who typically never meets his target.
For years, reformed computer hacker Kevin Mitnick was the most notable proponent of this technique. But this year "private detectives" hired by HP gave him a run for his money with their use of pretexting to trick phone companies into handing over confidential call records of HP board members and several journalists as part of an ill-fated mole hunt.
Is there a lesson to learned? As one long-time scam watcher says:
"Con games never remain stationary. The principle may be old, but the external forms are always changing, for con men know they must adapt their schemes to the times. This is especially true of the Big Con. A good grifter is never satisfied with the form his swindle takes; he studies it constantly to improve it; as he learns more about people, he finds a way to use what he has learned", from The Big Con, by David Maurer