The term ‘keylogger’ itself is neutral, and the word describes the program’s function. Most sources define a keylogger as a software program designed to secretly monitor and log all keystrokes. This definition is not altogether correct, since a keylogger doesn’t have to be software – it can also be a device. Keylogging devices are much rarer than keylogging software, but it is important to keep their existence in mind when thinking about information security.
Legitimate programs may have a keylogging function which can be used to call certain program functions using “hotkeys,” or to toggle between keyboard layouts (e.g. Keyboard Ninja). There is a lot of legitimate software which is designed to allow administrators to track what employees do throughout the day, or to allow users to track the activity of third parties on their computers. However, the ethical boundary between justified monitoring and espionage is a fine line. Legitimate software is often used deliberately to steal confidential user information such as passwords.
Most modern keyloggers are considered to be legitimate software or hardware and are sold on the open market. Developers and vendors offer a long list of cases in which it would be legal and appropriate to use keyloggers, including:
- Parental control: parents can track what their children do on the Internet, and can opt to be notified if there are any attempts to access websites containing adult or otherwise inappropriate content;
- Jealous spouses or partners can use a keylogger to track the actions of their better half on the Internet if they suspect them of “virtual cheating”;
- Company security: tracking the use of computers for non-work-related purposes, or the use of workstations after hours;
- Company security: using keyloggers to track the input of key words and phrases associated with commercial information which could damage the company (materially or otherwise) if disclosed;
- Other security (e.g. law enforcement): using keylogger records to analyze and track incidents linked to the use of personal computers;
- Other reasons.
Furthermore, many keyloggers hide themselves in the system (i.e. they have rootkit functionality), which makes them fully-fledged Trojan programs.
As such programs are extensively used by cyber criminals, detecting them is a priority for antivirus companies. Kaspersky Lab’s malware classification system has a dedicated category for malicious programs with keylogging functionality: Trojan-Spy. Trojan-Spy programs, as the name suggests, track user activity, save the information to the user’s hard disk and then forward it to the author or ‘master’ of the Trojan. The information collected includes keystrokes and screen-shots, used in the theft of banking data to support online fraud.
Why keyloggers are a threat
Unlike other types of malicious program, keyloggers present no threat to the system itself. Nevertheless, they can pose a serious threat to users, as they can be used to intercept passwords and other confidential information entered via the keyboard. As a result, cyber criminals can get PIN codes and account numbers for e-payment systems, passwords to online gaming accounts, email addresses, user names, email passwords etc.Once a cyber criminal has got hold of confidential user data, s/he can easily transfer money from the user’s account or access the user’s online gaming account. Unfortunately access to confidential data can sometimes have consequences which are far more serious than an individual’s loss of a few dollars. Keyloggers can be used as tools in both industrial and political espionage, accessing data which may include proprietary commercial information and classified government material which could compromise the security of commercial and state-owned organizations (for example, by stealing private encryption keys).
Keyloggers, phishing and social engineering (see ‘Computers, Networks and Theft’) are currently the main methods being used in cyber fraud. Users who are aware of security issues can easily protect themselves against phishing by ignoring phishing emails and by not entering any personal information on suspicious websites. It is more difficult, however, for users to combat keyloggers; the only possible method is to use an appropriate security solution, as it’s usually impossible for a user to tell that a keylogger has been installed on his/ her machine.
According to Cristine Hoepers, the manager of Brazil’s Computer Emergency Response Team, which works under the aegis of the country’s Internet Steering Committee, keyloggers have pushed phishing out of first place as the most-used method in the theft of confidential information. What’s more, keyloggers are becoming more sophisticated – they track websites visited by the user and only log keystrokes entered on websites of particular interest to the cyber criminal.
In recent years, we have seen a considerable increase in the number of different kinds of malicious programs which have keylogging functionality. No Internet user is immune to cyber criminals, no matter where in the world s/he is located and no matter what organization s/he works for.
How cyber criminals use keyloggers
One of the most publicized keylogging incidents recently was the theft of over $1million from client accounts at the major Scandinavian bank Nordea. In August 2006 Nordea clients started to receive emails, allegedly from the bank, suggesting that they install an antispam product, which was supposedly attached to the message. When a user opened the file and downloaded it to his/ her computer, the machine would be infected with a well known Trojan called Haxdoor. This would be activated when the victim registered at Nordea’s online service, and the Trojan would display an error notification with a request to re-enter the registration information. The keylogger incorporated in the Trojan would record data entered by the bank’s clients, and later send this data to the cyber criminals’ server. This was how cyber criminals were able to access client accounts, and transfer money from them. According to Haxdoor’s author, the Trojan has also been used in attacks against Australian banks and many others.On January 24, 2004 the notorious Mydoom worm caused a major epidemic. MyDoom broke the record previously set by Sobig, provoking the largest epidemic in Internet history to date. The worm used social engineering methods and organized a DoS attack on www.sco.com; the site was either unreachable or unstable for several months as a consequence. The worm left a Trojan on infected computers which was subsequently used to infect the victim machines with new modifications of the worm. The fact that MyDoom had a keylogging function to harvest credit card numbers was not widely publicized in the media.
In early 2005 the London police prevented a serious attempt to steal banking data. After attacking a banking system, the cyber criminals had planned to steal $423 million from Sumitomo Mitsui’s London-based offices. The main component of the Trojan used, which was created by the 32-year-old Yeron Bolondi, was a keylogger that allowed the criminals to track all the keystrokes entered when victims used the bank’s client interface.
In May 2005 in London the Israeli police arrested a married couple who were charged with developing malicious programs that were used by some Israeli companies in industrial espionage. The scale of the espionage was shocking: the companies named by the Israeli authorities in investigative reports included cellular providers like Cellcom and Pelephone, and satellite television provider YES. According to reports, the Trojan was used to access information relating to the PR agency Rani Rahav, whose clients included Partner Communications (Israel’s second leading cellular services provider) and the HOT cable television group. The Mayer company, which imports Volvo and Honda cars to Israel, was suspected of committing industrial espionage against Champion Motors, which imports Audi and Volkswagen cars to the country. Ruth Brier-Haephrati, who sold the keylogging Trojan that her husband Michael Haephrati created, was sentenced to four years in jail, and Michael received a two-year sentence.
In February 2006, the Brazilian police arrested 55 people involved in spreading malicious programs which were used to steal user information and passwords to banking systems. The keyloggers were activated when the users visited their banks’ websites, and secretly tracked and subsequently sent all data entered on these pages to cyber criminals. The total amount of money stolen from 200 client accounts at six of the country’s banks totaled $4.7million.
At approximately the same time, a similar criminal grouping made up of young (20 – 30 year old) Russians and Ukrainians was arrested. In late 2004, the group began sending banking clients in France and a number of other countries email messages that contained a malicious program – namely, a keylogger. Furthermore, these spy programs were placed on specially created websites; users were lured to these sites using classic social engineering methods. In the same way as in the cases described above, the program was activated when users visited their banks’ websites, and the keylogger harvested all the information entered by the user and sent it to the cyber criminals. In the course of eleven months over one million dollars was stolen.
There are many more examples of cyber criminals using keyloggers – most financial cybercrime is committed using keyloggers, since these programs are the most comprehensive and reliable tool for tracking electronic information.
