The folks over at Arbor Networks were browsing Twitter and discovered something very strange: a Twitter account seemingly posting gibberish. At least, that’s how it appeared at first. Upon closer investigation, they discovered that the profile was posting base64 encoded links to PKZIP archives. When they extracted the contents and unpacked the contained DLL and EXE files, they discovered that the account was posing links to malware that would post user information back to certain URLs. The article was also updated to show that the scheme wasn’t limited to Twitter, but also affected users on Jaiku and Tumblr. It’s a bit scary to see that all malware isn’t as blatantly obvious as we usually would think it to be.

PandaLabs has identified a botnet running a malware campaign impersonating president-elect Obama’s website. The front page of the site features a sensational story titled “Barack Obama has refused to be a president”. Clicking the link will download the malware and make the target’s machine part of the botnet. They’re using fast-flux to assign the malicious domains to the massive number of compromised nodes that are hosting the actual site. The team has contacted the domain name registrar in China to get the domains removed. Using a sensational headline is not new to malware; it’s how the Storm Worm got its name.

[via lithium]

Zero Day has an interview with German researchers who have found a way to take down the Storm Worm botnet. Their program, Stormfucker, takes advantage of flaws in Storm’s command network: Nodes that are NAT‘d only use a four-byte XOR challenge. Nodes that aren’t NAT’d are only using a trivial 64bit RSA signature. Their solution can clean infected machines and also distribute to other nodes. Unfortunately, installing software without the user’s consent is the exact same behavior as malware. Don’t expect to see this in any sort of widespread use. The researchers did point out that some ISPs have moved to shutting off service for infected customers until their machines are cleaned.

The Washington Post is reporting that the shutdown of one hosting company has caused the total volume of spam to drop by 2/3rds. The company in question is McColo Corp. Both Hurricane Electric and Global Crossing pulled the plug today after a damning report revealed a number of illegal activities happening on McColo’s servers. McColo already had a reputation with the security community. When contacted about abuse, the company would often shift servers to new IP ranges instead of shutting them down. Although not the main source of spam, the company was host to many botnet control servers and phishing sites.

[photo: mattdork]

[via Waxy]

P2P networks have long been a legal gray area, used for various spam schemes, illegal filesharing, and lots and lots of adware. Last year, though, the first botnet created by a worm distributed via P2P software surfaced, the work of 19-year-old [Jason Michael Milmont] of Cheyenne, Wyoming, who distributed his Nugache Worm by offering free downloads of the P2P app Limewire with the worm embedded. He later began distributing it using bogus MySpace and Photobucket links shared via chats on AOL Instant Messenger. The strategy proved effective, as the botnet peaked with around 15,000 bots. [Milmont] has plead guilty to the charges against him. Per his plea agreement, he will pay $73,000 in restitution and may serve up to five years in prison.