SUMMARY Two California men have been arrested and charged in what is being called the largest NFT fraud…

****SUMMARY****

*   **Two California men charged in the largest NFT fraud case, stealing $22M via “rug pull” schemes.**

*   **Fraudulent projects included “Vault of Gems” and “Faceless,” promising false features.**

*   **Defendants allegedly intimidated others and hid their involvement in the scams.**

*   **Charges carry penalties of up to 20 years for wire fraud and 5 years for stalking.**

*   **The case highlights the need for caution in the evolving NFT and crypto markets.**

Two California men have been arrested and charged in what is being called the largest **NFT fraud** case to date. Gabriel Hay, 23, of Beverly Hills, and Gavin Mayo, 23, of Thousand Oaks, are accused of running a series of “rug pull” schemes, defrauding investors out of over $22 million in cryptocurrency. The six-count indictment (PDF), unsealed in Los Angeles, details a three-year operation involving multiple fraudulent digital asset projects.

****What is a “Rug Pull”?****

A “**rug pull**” is a type of scam common in the cryptocurrency industry. It involves creators of a new digital asset, such as an NFT, heavily promoting their project and soliciting investments. Once they’ve gathered a substantial sum, they suddenly abandon the project, leaving investors with worthless assets and making off with the funds.

****The Case****

According to the U.S. Department of Justice’s **press release,** from May 2021 to May 2024, Hay and Mayo allegedly orchestrated a string of these scams, using projects with names like “Vault of Gems,” “Dirty Dogs,” “Faceless,” “Sinful Souls,” and “Clout Coin,” among others. They lured investors with elaborate “roadmaps” outlining ambitious plans for their NFTs, promising unique features and future development.

For example, they claimed the “Vault of Gems” project would be the “first NFT project to be pegged to a hard asset.” However, these promises were reportedly hollow. After collecting millions from investors, Hay and Mayo allegedly abandoned each project, leaving investors high and dry.

Vault of Gems NFTs created by Hey, as per the indictment

They also used various ways to hide themselves in the process, they allegedly identified other persons to be the owners, when actually Hay and Mayo were the owners. One project manager had great emotional distress because of the intimidation coming from Hay and Mayo because he exposed them for being behind the Faceless NFT project.

The alleged fraud scheme began to come apart when Homeland Security Investigations (HSI) initiated an investigation. “For three years, Hay and Mayo apparently lied to their investors in order to defraud them out of millions of dollars,” said HSI Executive Associate Director **Katrina W. Berger**, emphasizing the devastating impact of these financial crimes, even without physical violence.

“Whenever a new investment trend occurs, scammers are sure to follow,” added U.S. Attorney Martin Estrada, highlighting the ongoing battle against cryptocurrency fraud.

****Charges and Future****

Hay and Mayo face serious charges, including conspiracy to commit wire fraud, wire fraud, and stalking. Each wire fraud-related count carries a maximum penalty of 20 years in prison, while the stalking count carries a maximum of five years. The final sentence will be determined by a federal judge.

This case is being handled by the National Cryptocurrency Enforcement Team (**NCET**), a specialized unit within the Department of Justice dedicated to combating crimes involving digital assets. The NCET focuses on investigating cryptocurrency exchanges, **mixing services**, and infrastructure providers that facilitate illicit activities. This is very important and is a must due to the growth of illicit use of cryptocurrencies.

****Lesson for Unsuspecting Investors****

This indictment shows the need for staying cautious and informed when investing in NFTs and other digital assets, especially as the market keeps changing. Investors are urged to conduct thorough research and be wary of projects that make promises without clear, actionable plans.

1.  **Police Arrest Suspect in Crypto Millionaire’s Murder**
2.  **What Makes Bitcoin NFTs Different from Other NFTs?**
3.  **Crypto tumbler BestMixer.io seized for money laundering**
4.  **Ukraine Arrests Cryptor Specialist Aiding LockBit Ransomware**
5.  **Hackers Hijacked Official Ferrari Subdomain to Host NFT Scam**
6.  **Lazarus Exploits Chrome 0-Day for Crypto with Fake NFT Game**

Two Californians charged in the largest NFT fraud case to date

While companies have responded to the new SEC rules by disclosing incidents promptly, many of the reports don't meet the SEC's "material" standard.

Source: Paul Hastings, LLP

The new cybersecurity disclosure rules introduced by the US Securities and Exchange Commission (SEC) last year have resulted in a significant increase of incident reports from public companies, but most of the reports do not include the material impact of those incidents, according to a law firm specializing in finance and M&A activity.

Analysis by Paul Hastings LLP found cybersecurity incident reports have increased by 60% since the disclosure rule went into effect in 2023. The SEC regulation requires public companies to disclose material cybersecurity incidents within four business days of determining materiality. Material, in this instance, means that the incident can impact someone's decision on whether to invest in the company. Determining materiality involves considering the immediate fallout and any longer-term effects on a company's operations, customer relationships, financial impact, reputational or brand perception, and the potential for litigation or regulatory action.

As the chart above shows, the impact of the regulation spans numerous industries. While the financial services sector accounted for the largest number of disclosure reports, industrials and healthcare were also heavily impacted. Automotive retail and retail entities were also hit by cyberattacks and had to report those incidents.

Less than 10% of the disclosures detailed the material impacts of the incidents, suggesting that companies are having difficulty balancing detailed reporting with protecting the details of internal operations. The report included examples of what was considered material, such as Basset Furniture Industries noting that business operations are materially impacted until recovery efforts are completed, or First American Financial disclosing adjusted earning per share for the fourth quarter financial results and quantifying the losses in the company's SEC filings.

Some companies (13%) opted to provide a press release or a reference to a blog post to provide more details about the incident.

**Third-Party Breach Impact**

One in four incidents in the report were third-party breaches. Companies are struggling to figure out whether to disclose third-party breaches, especially if other victims have disclosed the incidents. The automotive retail sector was affected primarily by the ransomware attack on automotive software provider CDK Global in June. The company paid a $25 million ransom. CDK's parent company, Brookfield Business Partners, said in its July disclosure that the company did not "expect this incident to have a material impact." Many of the smaller automotive companies claimed material impact as a result of CDK's incident.

The SEC recently announced enforcement settlements with four SolarWinds customers for allegedly making misleading disclosures related to how they were impacted by the cyberattack. Two of the four publicly disclosed the incidents but did not disclose all material facts known at the time, such as the name of the threat actor, nature of information stolen, and number of accounts accessed. The other two did not disclose the incidents, and the SEC said they should have disclosed the impact.

**Speed or More Details?**

More than three-quarters (78%) of disclosures were made within eight days of discovery of the incident. The SEC specified that the deadline to disclose is not four business days after discovering the incident but rather when materiality has been determined, but most companies opted to act quickly. A third (32%) filed within four days of discovery. This suggests that companies are reporting quickly to avoid being fined by the SEC for delayed disclosure but too quickly because they have not yet determined the full implications of the incident. This may be why 42% of the companies wound up filing multiple reports for the same incident, each time providing more details, such as quantifiable loss, impact to customer personal data, and notification to individuals and regulators.

"Companies should continue to evaluate disclosure controls and engage in tabletop exercises to practice the decision-making required to makes such materiality decisions in the event of a cyber incident," the report's authors said.

**About the Author**

Managing Editor, Features, Dark Reading

As Dark Reading’s managing editor for features, Fahmida Y Rashid focuses on stories that provide security professionals with the information they need to do their jobs. She has spent over a decade analyzing news events and demystifying security technology for IT professionals and business managers. Prior to specializing in information security, Fahmida wrote about enterprise IT, especially networking, open source, and core internet infrastructure. Before becoming a journalist, she spent over 10 years as an IT professional -- and has experience as a network administrator, software developer, management consultant, and product manager. Her work has appeared in various business and test trade publications, including VentureBeat, CSO Online, InfoWorld, eWEEK, CRN, PC Magazine, and Tom’s Guide.

SEC Disclosures Up, But Not Enough Details Provided

A Brazilian citizen has been charged in the United States for allegedly threatening to release data stolen by hacking into a company's network in March 2020.
Junior Barros De Oliveira, 29, of Curitiba, Brazil has been charged with four counts of extortionate threats involving information obtained from protected computers and four counts of threatening communications, the U.S. Department of

Brazilian Hacker Charged for Extorting $3.2M in Bitcoin After Breaching 300,000 Accounts

From zero-day exploits to 5G network vulnerabilities, these are the threats that are expected to persist over the next 12 months.

In 2024, we at Dark Reading covered a variety of attacks, exploits, and, of course, vulnerabilities across the board. Here, we recount 10 emerging threats organizations should be prepared for — as detailed by Dr. Jason Clark in "10 Emerging Vulnerabilities Every Enterprise Should Know," a Dark Reading webinar — as they continuously rise and develop in 2025.

**Zero-Day Exploits**

Zero-days and their increase in volume across the cybersecurity landscape is a particularly concerning trend, as there is no patch for these bugs when they're discovered. Attackers are also able to exploit systems using these vulnerabilities undetected, as safeguards have not been put in place by organizations or enterprises yet.

High-profile zero-day vulnerabilities include Log4Shell, tracked as CVE-2021-44228, a critical RCE bug within Log4j's Java Naming and Directory Interface (JNDI). By exploiting the vulnerability, attackers were able to easily take control of vulnerable systems, a considerable threat as Log4j is used in nearly every Java application.

Other vulnerabilities include PrintNightmare and Proxyshell, both remote execution flaws that were exploited quickly and widely, according to Clark.

"The rise in zero-day exploits is partly driven by just more sophisticated threat actors," Clark said in the Dark Reading webinar. "This can include things like nation-states and also using them in targeted attacks."

Chad Graham, cyber incident response team (CIRT) manager at Critical Start, however, believes that advancements with AI will change the landscape in 2025.

"Both attackers and defenders will rely on AI-driven tools to automate the search for hidden software flaws," Graham says. "This shift will likely result in a more dynamic cybersecurity landscape, where continuous innovation and adaptation become the norm."

**Supply Chain Attacks**

Supply chain attacks remain an active threat and tend toward the severe as their impact cascades on to multiple parties: customers, suppliers, and other third parties. Attackers exploit a trusted resource and ultimately gain access to not just one organization, but multiple. These kinds of threats remain concerning as organizations depend more and more on outsourcing services.

The best known example is the SolarWinds breach, which impacted the SolarWinds Orion system, at the hands of a group known as Nobelium. More than 30,000 organizations — including state and federal agencies — used the Orion network management system, resulting in the backdoor malware compromising thousands of data, network, and systems.

Tracked as CVE-2020-10148 with a CVSS score of 9.8, the authentication bypass bug allowed an unauthenticated attacker to execute API commands. The attackers in question were advanced persistent threat (APT) actors who infiltrated into the SolarWinds’ supply chain to insert a backdoor.

"The complexity of modern supply chains makes it challenging to secure all the dependencies," Clark said in the webinar. "This underscores the need for rigorous third-party risk management."

In the year ahead, Dana Simberkoff, chief risk, privacy, and information security officer at AvePoint, believes that there will be a sharpened focus on supply chains and third-party risk management.

"The CrowdStrike incident wasn't just a wake-up call — it was a stark reminder that in our interconnected ecosystem, one weak link can trigger a catastrophic chain reaction," Simberkoff says.

**Remote Work Infrastructure Exploits**

Since 2020 and the COVID-19 pandemic, organizations have leaned into remote and hybrid work offerings, increasing the risk of cybersecurity threats and becoming a significant concern. Attackers focus on vulnerabilities that allow users to engage in remote work such as VPNs, remote desktop protocols (RDPs), and phishing attacks through platforms such as Zoom and Microsoft Teams.

There have been several notable incidents in which VPNs and RDPs were leveraged, allowing threat actors to gain access to enterprise systems and networks. In addition, remote workers are often operating from less secure environments, causing an uptick in phishing attacks as the threat actors try to take advantage of these blind spots.

"The shift to remote work has expanded the overall attack surface, Clark said in the webinar. "Remote workers often need more security controls than those that are working \[onsite\], which can lead to significant vulnerabilities."

Recent examples of vulnerabilities remote and hybrid work vulnerabilities include CVE-2024-38199, a remote code execution vulnerability (RCE) in the Windows or Line Printer Deamon (LPD) Service, and CVE-2024-21433, a Windows Print Spooler elevation of privilege vulnerability.

"Remote work infrastructure will continue to be a prime target for cybercriminals in 2025, with an increase in sophisticated attacks on cloud services, VPNs, and collaboration tools," says Stephen Kowski, field CTO at SlashNext Email Security+. "We'll likely see more AI-powered threats designed to bypass traditional security measures, exploiting vulnerabilities in interconnected devices and home networks."

**Exploitation of AI and Machine Learning Systems**

With the rise of AI and its increasing use amid the public, comes widespread risk of exploitation from attackers. Clark noted of adversarial attacks, data poisoning, and model inversion attacks that are at the forefront of emerging threats for AI and machine learning (ML) systems in particular. 

The nature of some ML systems requires feeding a system information for the best results, the system becoming more familiar with the user over time. When attacks target these systems, it can lead to unauthorized access to sensitive data stored and processed within these tools, as well as incorrect predictions or biased decisions.

"AI models will be key areas of exploitation in 2025," says Rom Carmel, co-founder and CEO at Apono. "As AI and machine learning become integral to identity verification systems, attackers will find ways to poison AI models or bypass them."

AI can also simply be manipulated for malicious ends, as seen when an AI deepfake robocall was created to impersonate US President Joe Biden to encourage individuals not to vote in the New Hampshire's Democratic primary, an event that could have had severe consequences on the US electoral process.

"The threat landscape is evolving with the rapid adoption of AI and ML," Clark said in the webinar. "Attackers increasingly focus on these systems to undermine their reliability and exploit vulnerability."

**Cloud Misconfigurations**

As organizations continue to shift their operations to the cloud, it will continue to emerge as a space for threat actors to thrive, often due to the cloud simply not being set up correctly.

Common examples of threats that circulate within the cloud are publicly accessible S3 buckets, misconfigured security groups in AWS, and exposed databases.

"Cloud misconfigurations can have severe impacts related to data breaches, unauthorized access to critical systems, financial loss, and reputational damage," Clark said. He added that the complexity of these environments is going to increase leading to more frequent configuration errors.

In the past, Amazon and Microsoft cloud environments have exposed customer data, such as viewing habits, names, email addresses, email content, and phone numbers. The leaks aren't due to vulnerabilities but misconfigurations ranging from insecure read-and-write permissions to inaccurate access lists and misconfigured policies.

"To successfully prevent cloud breaches in 2025, companies need to focus on three key areas: visibility, access control, and continuous monitoring," says Jason Soroko, senior fellow at Sectigo. "Cloud environments are dynamic, so your security needs to be dynamic too."

**IoT Device Vulnerabilities**

IoT devices are allowing for emerging threats to thrive, being easy targets for threat actors to exploit, whether it be due to weak default passwords, lack of encryption, or insecure firmware.

Common attacks that IoT devices face are data theft, network breaches, and distributed denial-of-service (DDoS) attacks. A recent example emerged in the Common Unix Printing System (CUPS) for managing printers and print jobs. The series of vulnerabilities, tracked as CVE-2024-47176, CVE-2024-47076, CVE-2024-47175, and CVE-2024-47177 could allow bad actors to stage DDoS attacks within seconds for less than 1 cent while using an available cloud platform.

"Just the sheer volume of connected devices really exacerbates the threat," Clark noted in the webinar. "Securing these devices becomes really challenging due to their diversity and often limited processing power for adding security features."

And as the use of IoT, OT, and 5G networks continues to rise, organizations will need cyber threat intelligence (CTI) to extend beyond traditional IT environments, says Callie Guenther, senior manager, cyber threat research at Critical Start. "This expansion, which will continue throughout 2025, will add complexity to CTI, requiring more granular insights and specific intelligence data."

**Cryptographic Weaknesses**

According to Clark, cryptographic weaknesses continue to pose a significant threat because these kinds of vulnerabilities undermine the foundation of secure communication and data protection. These weaknesses often manifest in one of two ways: flaws in encryption algorithms, or how the algorithms are implemented.

"The rising threat is kind of compounded by the fact that as computational capability advances, that previously secure crypto standard now becomes increasingly more vulnerable," Clark said in the webinar.

He recommended regularly updating cryptographic libraries, and enforcing strong encryption protocols to avoid exploitation attempts like man-in-the middle attacks, data integrity issues, and the exposed sensitive information.

Just recently, Acros Security discovered a vulnerability, similar to CVE-2024-38030, that enables an attack in which a vulnerable device is coerced into sending NTLM hashes, which is the cryptographic version of a user's password, to a threat actor.

"We have never before required from \[cloud service providers\] such granular and detailed information on the type of encryption in use, but customers (government and non-government customers alike) will require this level of detail to ensure their encryption standards are being met," says Philip George, executive technical strategist at InfoSec Global Federal.

**API Security Gaps**

More organizations are relying on APIs to connect systems; however, these APIs are at risk when they have flaws in the design or the implementation of the APIs. Attackers are able to breach systems through unauthorized access, allowing them to manipulate certain restricted actions.

A notable example of this is the exposure of user data through Facebook’s API, though these flaws are also abundant in other sectors such as healthcare or financial services. 

Gaps in API security ultimately serve as a launchpad, often for data breaches which can lead to the loss of sensitive information, unauthorized transactions, reputational damage, and significant financial loss.

"The threat is escalating as API is becoming more prevalent, increasing the number of potential attack surfaces," Clark said. "To mitigate these risks, it's essential to secure your API endpoints, enforce robust authentication mechanisms, and regularly update and audit API access."

A Docusign API was recently used in a wide-scale phishing campaign due to its "API-friendly environment," which is beneficial for businesses but also provides a way for bad actors to conduct malicious operations. The flaw could ultimately could have led to instances of fraud, though there are ways for users to avoid and detect such API abuse.

In the coming year, the cyber landscape will continue to evolve, API being in the forefront of these changes.

"We anticipate a rise in sophisticated API attacks using automation, artificial intelligence, and advanced evasion techniques to exploit vulnerabilities and bypass traditional security measures," says Eric Schwake, director of cybersecurity strategy at Salt Security. "One significant risk will stem from the exploitation of API misconfigurations, which often occur due to the fast pace of development and deployment. This situation will challenge organizations to adopt a more proactive and comprehensive approach to API security."

**Ransomware Evolution**

"We could do a whole webinar on ransomware," Clark said in the webinar, which raises the question: Can ransomware even be considered an emerging threat? 

The answer is yes, though ransomware attacks have become one of the most disruptive and costly cyberattacks out there largely due to their rapid evolution.

One of the most notable ransomware attacks occurred on Colonial Pipeline, which shut down its entire operations for the first time, leading to fuel shortages and four states on the East Coast declaring a state of emergency. The ransomware attack prompted action from national security and the executive branch and forced a reevaluation of the nation's critical infrastructure security.

Threat actors know they can win big when demanding ransoms from organizations, such as those in the healthcare sector, which will pay these high prices in order to help patients in need.

"As these attacks are becoming more targeted and, frankly, aggressive, it's crucial to start to implement backup strategies that are robust, strengthen your overall incident response plans, and continuously educate your employees on recognizing and avoiding things like phishing attempts that can often serve as an entry point for ransomware," Clark said in the webinar.

Backups may not always be an option, according to Brandon Williams, chief technology officer at Conversant Group.

"Some threat actors have moved to deleting data as part of their normal motions," he says. "If this gains traction in 2025, organizations will not have a method to recover by simply paying a ransom and hoping to get a working decryption tool. The only method of recovery will be backups; however, data shows that backups do not typically survive these breaches."

**5G Network Vulnerabilities**

5G networks are being rapidly deployed, and with them come threat actors' awareness and exploitation of its vulnerabilities. Attackers are increasingly able to target 5G infrastructure with ease, and these open the door for even bigger threats such as large-scale DDoS attacks, unauthorized data access, and disruption of our critical services.

"As we consider the rising threat, the global rollout of 5G brings an increasing number of connected devices," Clark said in the webinar. "The rising number amplifies their attack risk, particularly given their reliance on cloud-native infrastructures."

At Black Hat 2024 in Las Vegas, seven Penn State University researchers detailed how mobile devices are at risk of data theft and denial of service due to 5G technology vulnerabilities. Threat actors use these resources simply by providing someone with an Internet connection, allowing easy access to spying, phishing, and more. 

"Vulnerabilities such as lack of initial broadcast message authentication, spectrum slicing, silent downgrade, and unsecured DNS paging currently affect 5G networks," says Mayuresh Dani, manager, security research, at Qualys Threat Research Unit. "In the year to come, these will continue affecting 5G networks and vulnerabilities in unsecured base stations will multiply snooping attacks."

Emerging Threats &amp; Vulnerabilities to Prepare for in 2025

iProov uncovers a major Dark Web operation selling stolen identities with matching biometrics, posing a serious threat to KYC verification systems

****SUMMARY****

*   **Dark Web Identity Fraud Operation:** iProov uncovered a sophisticated dark web network collecting genuine identity documents and facial images to bypass KYC verification.

*   **Voluntary Identity Compromise:** Individuals in regions like LATAM and Eastern Europe are willingly selling their personal and biometric data for short-term financial gain.

*   **Evolving Fraud Techniques:** Attackers use methods ranging from basic static images to advanced tools like deepfake software and custom AI models to defeat liveness checks.

*   **Global Biometric Data Risks:** High-profile breaches (e.g., ZKTeco and ChiceDNA) reveal vulnerabilities in biometric access systems and facial recognition technologies.

*   **Multi-Layered Defense Needed:** Experts recommend advanced real-time verification, challenge-response mechanisms, and continuous monitoring to counter these sophisticated threats.

iProov, a provider of science-based biometric identity verification solutions, has uncovered a large-scale Dark Web operation dedicated to bypassing Know Your Customer (KYC) verification checks. This operation involves systematically collecting genuine identity documents and corresponding facial images.

The iProov Security Operations Center (iSOC) and the company’s Biometric Threat Intelligence service discovered this threat through extensive threat-hunting activities and red team testing. The dark web group has amassed a substantial collection of these identities, potentially obtained through compensated participation where individuals willingly provide their personal information in exchange for payment. This alarming trend extends beyond traditional data theft, as individuals knowingly compromise their identities for short-term financial gain.

“What’s particularly alarming about this discovery is not just the sophisticated nature of the operation, but the fact that individuals are willingly compromising their identities for short-term financial gain,” said Andrew Newell, Chief Scientific Officer at iProov in a press release. Selling identity documents and biometric data not only risks financial security but also provides criminals with genuine identity packages for sophisticated impersonation fraud, Newell added.

This operation, primarily observed in the LATAM and Eastern Europe regions, presents a significant challenge to organizations relying on biometric verification. Genuine credentials paired with matching facial images can easily bypass traditional document verification and basic facial matching systems.

Furthermore, the sophistication of these attacks continues to evolve. While basic attacks utilize simple methods like printed photos or static images, mid-tier attackers employ more advanced techniques such as real-time face-swapping and Deepfake software.

The most sophisticated attackers leverage custom AI models and specialized software to create synthetic faces that can respond to liveness challenges, making it increasingly difficult to distinguish between genuine and fabricated interactions.

This indicates that verification systems face a multi-layered challenge in detecting fake documents and genuine credentials misused by unauthorized individuals. Biometric data, like fingerprints and facial recognition, is increasingly used for identification and security purposes. However, recent incidents involving major vendors and service providers highlight a growing threat to this sensitive information. 

> 📢 EXPOSED: Criminal networks aren't stealing identities anymore.
> 
> They're buying them. Legally. With cash.
> 
> And because these are REAL documents freely given, traditional fraud checks are useless.
> 
> Watch how this works 📷 or Read more: https://t.co/0mX1VSf9my pic.twitter.com/X2KR4tJ61t
> 
> — iProov (@iProov) December 23, 2024

In June 2024, Hackread reported Kaspersky Lab discovered 24 vulnerabilities in ZKTeco’s biometric access systems, which are used for facial recognition and entry control.  The vulnerabilities ranged from SQL injection vulnerabilities to buffer overflow flaws, allowing attackers to inject malicious code.

In September 2024, a separate incident exposed the sensitive data of thousands of customers who used ChiceDNA, an Indiana-based genetic testing and facial matching service. An unsecured WordPress folder left publicly accessible contained biometric images, personal details, and even facial DNA data.

Therefore, organizations should adopt a multi-layered verification approach to combat such threats. This includes verifying the presented identity against official documents and detecting real persons using embedded imagery and metadata analysis.

Real-time verification using unique challenge-response mechanisms, along with managed detection and response through advanced technologies and continuous monitoring, is also essential. Improving protection against sophisticated attacks would make it harder for attackers to spoof verification systems.

1.  **Thousands of UEFA Customer Credentials Sold on Dark Web**
2.  **Stolen Singaporean Identities Sold on Dark Web Starting at $8**
3.  **Dark Web Sales Fuel 32% Increase in Healthcare Cyberattacks**
4.  **Hackers Sell Fake Pegasus Spyware on Clearnet and Dark Web**
5.  **Dark Web Anti-Bot Services Help Phishers Bypass Google Alerts**

Researchers Uncover Dark Web Operation Entirely Focused on KYC Bypass

From Chinese cyberspies breaching US telecoms to ruthless ransomware gangs disrupting health care for millions of people, 2024 saw some of the worst hacks, breaches, and data leaks ever.

Every year has its own mix of digital security debacles, from the absurd to the sinister, but 2024 was particularly marked by hacking sprees in which cybercriminals and state-backed espionage groups repeatedly exploited the same weakness or type of target to fuel their frenzy. For attackers, the approach is ruthlessly efficient, but for compromised institutions—and the individuals they serve—the malicious rampages had very real consequences for people's privacy, safety, and security.

As political turmoil and social unrest intensify around the world, 2025 will be a complicated—and potentially explosive—year in cyberspace. But first, here's WIRED's look back on this year's worst breaches, leaks, state-sponsored hacking campaigns, ransomware attacks, and digital extortion cases. Stay alert, and stay safe out there.

**China's Salt Typhoon Telecom Breaches**

Espionage operations are a fact of life, and relentless Chinese campaigns have been a constant in cyberspace for years now. But the China-linked espionage group Salt Typhoon carried out a particularly noteworthy operation this year, infiltrating a slew of US telecoms including Verizon and AT&T (plus others around the world) for months. And US officials told reporters earlier this month that many victim companies are still actively attempting to remove the hackers from their networks.

The attackers surveilled a small group of people—less than 150 by current count—but they include individuals who were already subject to US wiretap orders as well as state department officials and members of both the Trump and Harris presidential campaigns. Additionally, texts and calls from other people who interacted with the Salt Typhoon targets were inherently also caught up in the espionage scheme.

**Snowflake Customer Breaches**

Throughout the summer, attackers were on a tear, breaching prominent companies and organizations that were all customers of the cloud data storage company Snowflake. The spree barely qualifies as hacking, since cybercriminals were simply using stolen passwords to log in to Snowflake accounts that didn't have two-factor authentication turned on. The end result, though, was an extraordinary amount of data stolen from victims including Ticketmaster, Santander Bank, and Neiman Marcus. Another prominent victim, the telecom giant AT&T, said in July that “nearly all” records relating to its customers' calls and texts from a seven-month stretch in 2022 were stolen in a Snowflake-related intrusion. The security firm Mandiant, which is owned by Google, said in June that the rampage impacted roughly 165 victims.

In July, Snowflake added a feature so account administrators could make two-factor authentication mandatory for all of their users. In November, suspect Alexander “Connor” Moucka was arrested by Canadian law enforcement for allegedly leading the hacking spree. He was indicted by the US Department of Justice for the Snowflake tear and faces extradition to the US. John Erin Binns, who was arrested in Turkey for an indictment related to a 2021 breach of the telecom T-Mobile, was also indicted on charges related to the Snowflake customer breaches.

**Change Healthcare Ransomware Attack**

At the end of February, the medical billing and insurance processing company Change Healthcare was hit with a ransomware attack that caused disruptions at hospitals, doctor's offices, pharmacies, and other health care facilities around the US. The attack is one of the all-time largest breaches of medical data, impacting more than 100 million people. The company, which is owned by UnitedHealth, is a dominant medical billing processor in the US. It said days after the attack started that it believed ALPHV/BlackCat, a notorious Russian-speaking ransomware gang, was behind the assault.

Personal data stolen in the attack included patient phone numbers, addresses, banking and other financial information, and health records including diagnoses, prescriptions, and treatment details. The company paid a $22 million ransom to ALPHV/BlackCat at the beginning of March in an attempt to contain the situation. The payment seemingly emboldened attackers to hit health care targets at an even greater rate than usual. With ongoing, rolling notifications to more than 100 million victims—with more still being discovered—lawsuits and other blowback has been mounting. This month, for example, the state of Nebraska sued Change Healthcare, alleging that “failures to implement basic security protections” made the attack much worse than it should have been.

**Russia's Midnight Blizzard Hit Microsoft**

Microsoft said in January that it had been breached by Russia's “Midnight Blizzard” hackers in an incident that compromised company executives' email accounts. The group is tied to the Kremlin's SVR foreign intelligence agency and is specifically linked to SVR's APT 29, also known as Cozy Bear. After an initial intrusion in November 2023, the attackers targeted and compromised historic Microsoft system test accounts that then allowed them to access what the company said were “a very small percentage of Microsoft corporate email accounts, including members of our senior leadership team and employees in our cybersecurity, legal, and other functions.” From there, the group exfiltrated “some emails and attached documents.” Microsoft said that the attackers seemed to be looking for information about what the company knew about them—in other words, Midnight Blizzard doing reconnaissance on Microsoft's research into the group. Hewlett-Packard Enterprise (HPE) also said in January that it had suffered a corporate email breach attributed to Midnight Blizzard.

**National Public Data**

The background check company National Public Data suffered a breach in December 2023, and data from the incident started showing up for sale on cybercriminal forums in April 2024. Different configurations of the data cropped up again and again over the summer, culminating in public confirmation of the breach by the company in August. The stolen data included names, Social Security numbers, phone numbers, addresses, and dates of birth. Since National Public Data didn't confirm the breach until August, speculation about the situation grew for months and included theories that the data included tens or even hundreds of millions of Social Security numbers. Though the breach was significant, the true number of impacted individuals seems to be, mercifully, much lower. The company reported in a filing to officials in Maine that the breach affected 1.3 million people. In October, National Public Data's parent company, Jerico Pictures, filed for Chapter 11 bankruptcy reorganization in the Southern District of Florida, citing state and federal investigations into the breach as well as a number of lawsuits that the company is facing over the incident.

**Honorable Mention: North Korean Cryptocurrency Theft**

A lot of people steal a lot of cryptocurrency every year, including North Korean cybercriminals who have a mandate to help fund the hermit kingdom. A report from the cryptocurrency tracing firm Chainalysis released this month, though, underscores just how aggressive Pyongyang-backed hackers have become. The researchers found that in 2023, hackers affiliated with North Korea stole more than $660 million across 20 attacks. This year, they stole roughly $1.34 billion across 47 incidents. The 2024 figures represent 20 percent of total incidents Chainalysis tracked for the year and a whopping 61 percent of the total funds stolen by all actors.

The sheer domination is impressive, but the researchers emphasize the seriousness of the crimes. “US and international officials have assessed that Pyongyang uses the crypto it steals to finance its weapons of mass destruction and ballistic missiles programs, endangering international security,” Chainalysis wrote.

The Worst Hacks of 2024

As organizations on the continent expand their use of digital technologies, they increasingly face many of the same threats that entities in other regions have had to deal with for years.

Source: Golden Dayz via Shutterstock

Rising Internet adoption and digital transformation initiatives are exposing organizations in Africa to a growing range of cyber threats.

One manifestation of the trend is a steady increase in distributed denial-of-service (DDoS) attacks on organizations in a handful of North African countries — which also happen to be the ones with the highest Internet penetration rates in the region.

**Surge in DDoS Activity**

A recent analysis of threat activity data during the first half of 2024 by Netscout showed a 30% increase in DDoS attacks in the Middle East and Africa overall compared with the previous quarter. Countries that experienced the largest growth in DDoS attacks included Algeria, Morocco, Tunisia, and Egypt.

Morocco, which has a 90% Internet penetration rate, reported 61,000 DDoS attacks during the first half of 2024, which was the highest number of DDoS attacks in the region during the period. A plurality of the attacks — 16,461 — targeted wireless telecom producers in the region; more than 6,000 were directed at wired telecom companies; and the rest affected organizations across multiple industry sectors.

Organizations in Egypt, another country in the region with a high Internet penetration rate, collectively experienced some 45,108 DDoS attacks in the first half of the year, with wired telecom carriers being the most frequently targeted entities, followed by wireless carriers and educational institutions. Netscout found some of the highest bandwidth attacks during the time period in Egypt, with the biggest one clocking in at a hefty 332.96 Gbit/s.

Related:China's 'Evasive Panda' APT Debuts High-End Cloud Hijacking

The story with Tunisia, which experienced 4,511 DDoS attacks in the first six months, was similar in terms of victimology: most victims were wired or wireless telecom providers. However, Netscout found threat actors deploying a larger number of DDoS attacks against Tunisian organizations than organizations in other countries. The largest such attack type involved a startling 27 vectors, including Apple Remote Management Service, Connection-less Lightweight Directory Access Protocol (CLDAP) , Constrained Application Protocol (COAP), and Domain Name System (DNS) amplification techniques for significantly increasing the power of an attack.

**Geopolitical Tensions, "Online-Ness" Drive Cyber Activity**

"These attacks can be attributed in part to businesses in countries such as Morocco, Tunisia, Egypt, Libya, and Algeria increasing their online presence over the past year," says Richard Hummel, director of threat intelligence at Netscout. "While digital transformation is generally a cause for celebration, unfortunately, it also means that more devices and services can be disrupted by attacks."

Related:'SloppyLemming' APT Abuses Cloudflare Service in Pakistan Attacks

A larger attack surface, however, is not the only reason for the increased DDoS activity in Africa and the Middle East, Hummel says. "Geopolitical tensions in these regions are also fueling a surge in hacktivist activity as real-world political disputes spill over into the digital world," he says. "Unfortunately, hacktivists often target critical infrastructure like government services, utilities, and banks to cause maximum disruption."

And DDoS attacks are by no means the only manifestation of the new threats that organizations in Africa are having to contend with as they broaden their digital footprint.

**Growing Cyber-Espionage, Cybercrime Risks**

The Africa Center for Strategic Studies in a recent report assessed that the increasing spread of IT, communications, and related technologies in the region is rapidly amplifying and altering threats against organizations — and raising national security challenges in the process. The center, which is a US Department of Defense institution, expects that over the next few years organizations in Africa will have to contend with a many of the same cyber threats that entities in other regions of the world have had to contend with for years.

Related:IDF Has Rebuffed 3B Cyberattacks Since Oct. 7, Colonel Claims

One of them is cyber espionage. "Cyberspace has fundamentally changed the methods and means through which states gather information on one another and their citizens," the Africa Center report noted. "Though the most significant cyberespionage concerns in Africa have centered around China, espionage and surveillance capabilities are rapidly diffusing across the continent."

Attacks on critical infrastructure and financially motived attacks by organized crime are other looming concerns. In the center's assessment, Africa's government networks and networks belonging to the military, banking, and telecom sectors are all vulnerable to disruptive cyberattacks. Exacerbating the concern is the relatively high potential for cyber incidents resulting from negligence and accidents.

Organized crime gangs — the scourge of organizations in the US, Europe, and other parts of the world, present an emerging threat to organizations in Africa, the Center has assessed.  "Growing internet penetration rates in Africa has both led to new kinds of cyber-dependent criminal activities, such as business email compromise or romance scams, as well transformed the financing and market dynamics of more traditional organized crime networks." Supply chain attacks are another major and emerging concern, especially given the high reliance on foreign suppliers among organizations in Africa.

Agnidipta Sarkar, vice president and CISO advisory at ColorToken, says organizations in Africa are going to come under growing pressure to implement defenses against new cyber threats, even as they embark on their digital transformation journey.

"The ability to continue business operations, despite cyberattacks, will encourage investments in the region," he predicts. "Effectively reporting breaches will emerge as a highly sought-after capability for CISOs, especially \[for\] those who can."

**About the Author**

Jai Vijayan is a seasoned technology reporter with over 20 years of experience in IT trade journalism. He was most recently a Senior Editor at Computerworld, where he covered information security and data privacy issues for the publication. Over the course of his 20-year career at Computerworld, Jai also covered a variety of other technology topics, including big data, Hadoop, Internet of Things, e-voting, and data analytics. Prior to Computerworld, Jai covered technology issues for The Economic Times in Bangalore, India. Jai has a Master's degree in Statistics and lives in Naperville, Ill.

DDoS Attacks Surge as Africa Expands Its Digital Footprint

Stay protected from SEO poisoning, a cyber threat exploiting search engine rankings to spread malware and phishing scams.…

Stay protected from SEO poisoning, a cyber threat exploiting search engine rankings to spread malware and phishing scams. Learn risks, real-world examples, and preventive measures for safer browsing.

Did you know that over 80% (PDF) of cyberattacks exploit online platforms, including search engines? These indispensable tools guide billions of users to the content they seek, but their trustworthiness can be weaponized.

Cybercriminals are exploiting search engine optimization (SEO) techniques to distribute malware, launch phishing attacks, and spread harmful content. This practice, known as SEO poisoning, manipulates search results to lure unsuspecting users into clicking on malicious links.

Recent reports indicate a significant rise in SEO poisoning attacks. Between August 2023 and January 2024, there was a 60% increase in malware detections stemming from malicious search results. Such trends highlight the growing sophistication of these tactics and the critical need for vigilance among businesses and individuals alike.

****What is SEO Poisoning?****

SEO poisoning is a malicious strategy where cybercriminals manipulate search engine algorithms to rank harmful websites prominently in search results. These websites often contain malware, phishing schemes, or scams designed to steal sensitive information.

Attackers capitalize on high-demand keywords tied to trending topics or urgent events, such as natural disasters, major product launches, or public health crises. By employing techniques like keyword stuffing, spammy backlinks, and deceptive content, they make their sites appear legitimate and lure unsuspecting users.

****Key Risks of SEO Poisoning:****

*   **Malware Distribution:** Clicking on infected links can install ransomware, spyware, or other malware.
*   **Phishing Scams:** Users are tricked into providing sensitive data like passwords or credit card information.
*   **Reputation Damage:** Legitimate businesses can lose credibility if associated with malicious links.

One example is the surge of Gootloader malware in early 2023. Attackers targeted niche search terms, such as _“implied employment agreement,”_ to redirect users to infected websites. These attacks emphasize how even low-competition search terms can become cybercriminals’ playgrounds.

****Real-World Examples of SEO Manipulation****

SEO manipulation has been used in several high-profile attacks, exploiting the trust users place in search results:

*   **Fake Antivirus Software:** Users searching for free antivirus tools were directed to malicious sites posing as trusted providers. These fake programs encrypted files and demanded ransom payments, exploiting users’ trust in well-known antivirus brands like Avast, Bitdefender and Malwarebytes. Fake antivirus websites have been known to impersonate popular security providers to deceive users.

*   Holiday Shopping Scams: During peak shopping seasons, cybercriminals created fake e-commerce sites targeting popular products. These fraudulent sites were designed to rank high in search results, allowing attackers to trick users into entering their payment information, which the criminals then stole.

*   **Software Search Exploitation:** In 2023, searches for popular tools like Blender 3D led users to fraudulent sites offering infected downloads. Such campaigns highlight the dangers of SEO poisoning when targeting trusted software.

These examples show how attackers exploit trust in search results and highlight the importance of vigilance, particularly during periods of heightened online activity.

****Protecting Against SEO-Based Threats****

Although SEO poisoning is a persistent threat, proactive measures can help both businesses and individual users reduce the risks.

****For Businesses****

Businesses must safeguard their websites and digital presence from exploitation. Trusted SEO providers can optimize websites while identifying and mitigating vulnerabilities, such as fake backlinks or unauthorized content changes, often exploited in SEO poisoning campaigns.

According to Stellar SEO, a custom SEO services provider, exploiting SEO-related vulnerabilities has even been adopted by top-tier groups such as the Chinese DragonRank, which was recently discovered manipulating search engines to redirect users to malicious websites.

****For Users****

Users can protect themselves by adopting proactive online habits:

*   **Verify the Source:** Always inspect URLs carefully before clicking, especially when searching for trending or high-demand topics.
*   **Use Trusted Security Tools:** Antivirus software and browser extensions can help identify and block harmful sites. For example, providers like _Kaspersky_ have shown how cybercriminals exploit marketing strategies to launch attacks.
*   **Stay Informed:** Awareness of the latest cybersecurity trends is crucial for recognizing and avoiding malicious tactics.

By combining secure SEO strategies with vigilance, businesses and users can significantly reduce their exposure to SEO poisoning threats.

****How Search Engines Are Combating SEO Poisoning****

Search engines like Google and Bing constantly update their algorithms to detect and penalize malicious websites. These updates target behaviors such as keyword stuffing, suspicious backlinking patterns, and misleading content.

****Key Defensive Measures Include:****

*   **Machine Learning Algorithms:** These tools analyze billions of web pages for signs of malicious intent.
*   **Safe Browsing Technology:** Platforms like Google warn users about harmful websites before they can be accessed.
*   **Domain Reputation Systems:** Search engines evaluate the trustworthiness of domains to demote those linked to malicious activity.

Despite these efforts, cybercriminals continue to evolve their techniques, creating sophisticated tactics to bypass detection. For instance, in November 2024, attackers exploited niche search queries like _“Are Bengal cats legal in Australia“_ to lure users to malicious websites. Such incidents underscore the importance of proactive measures by users and businesses to complement automated systems. Recognizing and avoiding malicious links remains a shared responsibility.

****Conclusion****

SEO poisoning is a growing threat at the intersection of cybersecurity and digital marketing. By exploiting legitimate SEO techniques, cybercriminals deceive users, distribute malware, and undermine trust in search engines.

For businesses, partnering with trusted providers of custom SEO services ensures websites are optimized securely, preventing vulnerabilities that attackers might exploit. For users, adopting habits like verifying sources, using reliable security tools, and staying informed about emerging threats is essential for staying safe online.

Every time you search online, consider the risks that lurk behind seemingly trustworthy links. By remaining vigilant and proactive, we can protect our digital spaces and maintain trust in the tools that shape our online world. 

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SEO Poisoning: How Cybercriminals Are Turning Search Engines into Traps

A US court ruled against NSO Group, an Israeli spyware maker, finding them liable for hacking WhatsApp users. The ruling has major implications for the surveillance technology industry."

****SUMMARY****

*   **NSO Group Held Accountable:** A U.S. court ruled against NSO Group for hacking WhatsApp accounts, violating U.S. law and its terms of service.

*   **Pegasus Spyware Abuse:** NSO exploited a WhatsApp flaw to install Pegasus spyware on 1,400 devices, targeting activists, journalists, and officials.

*   **WhatsApp Lawsuit Victory:** WhatsApp sued NSO in 2019 after discovering the spyware attack, marking a major win for privacy rights.

*   **Court Rejects NSO’s Defense:** The court dismissed NSO’s claims of immunity, holding it liable despite its stated anti-terrorism purpose.

*   **Spyware Industry Implications:** The ruling sets a precedent for accountability, boosting privacy advocacy efforts against invasive technologies.

The Israeli spyware company NSO Group has been held liable for compromising the accounts of hundreds of WhatsApp users, marking a significant legal victory for Meta Platforms.

****The Ruling****

In a landmark ruling, U.S. District Judge Phyllis Hamilton found the NSO Group responsible for hacking and breaching the world’s leading messaging app WhatsApp’s terms of service, compromising the accounts of hundreds of its users. 

According to court documents (PDF), the NSO Group exploited a vulnerability in the messaging app to install its powerful Pegasus spyware on at least 1,400 devices. This spyware, known for its ability to infiltrate phones and extract sensitive data, was allegedly used to target journalists, human rights activists, political dissidents, and government officials, raising serious concerns about privacy and human rights.

****Background Details****

For your information, WhatsApp filed the lawsuit in 2019, accusing NSO Group of accessing its servers without authorization to deploy Pegasus. It was reported by Hackread.com that the NSO Group was suspected of exploiting a new “MMS Fingerprint” attack on WhatsApp, exposing device information without user interaction. 

Hackread.com also reported earlier this year that WhatsApp discovered the vulnerability in May 2019, which let attackers install Pegasus spyware on users’ devices. The flaw was then used to target government officials and activists globally. WhatsApp sued NSO Group for the exploitation 

The Israeli firm, which claims its technology is used to combat terrorism and crime, argued that its actions were justified and that it should be shielded from liability. However, the court rejected these arguments, finding that it was responsible for the breach and that its actions violated US law.

This ruling has major implications for the spyware industry, which operates in a legal gray area. It establishes a precedent that companies like NSO Group can be held accountable for the misuse of their technology, even if they claim to be providing services to legitimate government agencies. The decision is also a major victory for privacy advocates, who have long warned about the dangers of invasive surveillance technologies.

WhatsApp hailed the ruling as a “huge win for privacy,” emphasizing that it would continue to work to protect user communications from such attacks. 

“We spent five years presenting our case because we firmly believe that spyware companies could not hide behind immunity or avoid accountability for their unlawful actions,” Will Cathcart, the head of WhatsApp stated.

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WhatsApp Wins Lawsuit Against Israeli Spyware Maker NSO Group

Cybersecurity researchers have discovered several security flaws in the cloud management platform developed by Ruijie Networks that could permit an attacker to take control of the network appliances.
"These vulnerabilities affect both the Reyee platform, as well as Reyee OS network devices," Claroty researchers Noam Moshe and Tomer Goldschmidt said in a recent analysis. "The vulnerabilities, if

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