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Author of SpyEye Trojan Pleads Guilty

The author of the infamous SpyEye Trojan pleaded guilty to conspiracy to commit wire and bank fraud, the Justice Department announced Tuesday.

Aleksandr Andreevich Panin, a Russian national also known as "Gribodemon" and "Harderman," pleaded guilty to charges for his role as the primary developer and distributor of SpyEye, malware designed to capture financial information, such as online banking logins, credit card numbers, usernames, passwords and other information.

According to estimates, the malware is said to have infected more than 1.4 million computers around the world. According to court documents, as the main developer of SpyEye, Panin operated from Russia from 2009 to 2011 and sold various versions of the crimekit through online criminal forums for between $1,000 and $8,500.

SpyEyeOver the years, the malware had many updates and variants, including new tactics to evade detection in 2012. 

According to Trend Micro, a hacker known by the cyber-alias “Soldier” led a bank fraud operation that netted $3.2 million in six months by using the SpyEye crimeware kit. Aided by money mules and an accomplice, Soldier commanded a botnet of more than 25,000 computers that compromised bank accounts to steal money. 

During the summer of 2011, FBI covert sources communicated directly with Panin about SpyEye and were able to buy a version from him that had the ability to steal confidential financial information, initiate fraudulent online banking transactions, install keystroke loggers, and initiate distributed denial of service (DDoS) attacks from SpyEye-infected computers.

Panin conspired with others, including Hamza Bendelladj, an Algerian national also known as "Bx1," who operated SpyEye servers and is awaiting trial. 

In February 2011, the FBI searched and seized a SpyEye Command and Control (C2) server allegedly operated by Bendelladj in Georgia. That C2 server controlled more than 200 computers infected with SpyEye and contained information from numerous financial institutions, the Department of Justice said.

Panin was arrested in July at the Atlanta International Airport.

The investigation also led to the arrests by international authorities of four of Panin’s SpyEye clients and associates in the United Kingdom and Bulgaria, the Justice Department said.

Sentencing for Panin is scheduled for April 29 in a federal court in Georgia.

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Related: Fraudster Pockets $3.2 Million in Six Months via SpyEye Botnet

Related: SpyEye Banking Trojan Updated to Cover its Tracks

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For more than 10 years, Mike Lennon has been closely monitoring the threat landscape and analyzing trends in the National Security and enterprise cybersecurity space. In his role at SecurityWeek, he oversees the editorial direction of the publication and is the Director of several leading security industry conferences around the world.