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Cybercrime experts call $45M heist 'pretty ingenious'

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By The Associated Press
Friday, May 10, 2013, 9:36 p.m.
 

NEW YORK — A bloodless bank heist that netted more than $45 million has left even cybercrime experts impressed by the technical sophistication, if not the virtue, of the con artists who pulled off a remarkable internationally organized attack.

“It was pretty ingenious,” Pace University computer science professor Darren Hayes said on Friday.

On the creative side of the heist, a small team of highly skilled hackers penetrated bank systems, erased withdrawal limits on prepaid debit cards and stole account numbers. On the crude end, criminals used handheld devices to change the information on the magnetic strips of old hotel key cards, used credit cards and depleted debit cards.

Seven people were arrested, accused of operating the New York cell of what prosecutors said was a network that carried out thefts at ATMs in 27 countries from Canada to Russia.

Here's how it worked:

First, the hackers, quite possibly insiders, broke into computer records at a few credit card processing companies, in India and then the United States. They didn't just take information; they actually raised the limit on prepaid debit cards kept in reserves at two large banks.

“It's pretty scary if you think about it. They changed the account balances. That's like the holy grail for a thief,” said Chris Wysopal, co-founder of security company Veracode.

The next step was technically simpler. Ring members in 27 countries ran used plastic cards through handheld magnetic stripe encoders, which are available online. The stripes were rewritten with information from the hackers. That allowed the thieves to turn the cards into gold, instantly transforming them into prepaid debit cards with unlimited amounts of money.

Finally it was time for action.

On two pre-arranged days — once in December and again in February — criminals loaded with the lucrative debit cards and PIN numbers, headed into cities around the world and raced from one ATM to the next, often taking out the maximum the cash machine would allow.

In December in less than 3 hours, they reaped $5 million in about 4,500 transactions. Two months later, they hit the ATMs for 10 hours straight, collecting $40 million in 36,000 transactions.

The New York runners made off with $2.8 million, according to the indictment.

Players kept a cut but sent the bulk of the money back to the masterminds, prosecutors said.

One New York suspect, Elvis Rodriguez, 24, planned to travel to Romania in January to pay about $300,000 to organizers of the operation, but American Airlines canceled the reservation because the airline was concerned it had been booked with a stolen credit card, according to the criminal complaint.

“There were obviously a lot of great minds behind this exploit, and then there were the pawns, the mules. They are entirely exploitable,” said Phyllis Scheck, vice president at the security firm McAfee who has testified to Congress about how banks need to prepare for cyber thieves.

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