Mobile Malware Continues to Be a Profitable Criminal Enterprise

Mobile security vendor Lookout, in their latest State of Mobile Security Report, said that mobile malware is a sustainable profit center for criminals. After that, the report highlights the point that privacy on mobile devices is on of the biggest issues of the year.

According to Lookout, premium text billing is the most common tactic used by malware writers to commit financial fraud on mobile. Malware used for Toll Fraud became the most prevalent type of malware discovered by the company on their customer’s devices. One variant of such malware, FakeInst, accounted for 82 percent of Lookout user detections in June 2012. It’s estimated to have successfully stolen millions of dollars from people in Russia, the Middle East and parts of Europe.

In a related note from the report, Russia, the Ukraine, and China are all areas where users are more likely to be victimized by mobile malware or related scams. Part of the reason mobile malware has blossomed is that developers are gaming the system.

For example, some malicious apps are designed to download from alternative markets, without the user’s knowledge, which enables the shady developers to root the phone and download additional apps or install third-party app stores without warning.

When it comes to privacy, the report says that a significant portion of privacy problems stemmed from aggressive advertising, including pushing out-of-app ads and accessing personally identifiable information without user notification. Lookout estimates that five percent of Android applications include these aggressive ad networks and these apps have been downloaded more than 80 million times.

“Trust is one of the most important factors influencing whether people will continue to use mobile devices to their full potential,” said Kevin Mahaffey, CTO and co-founder of Lookout.

“As smartphones and tablets have come to house our personal data, access financial information, and power practically all of our communications, there are more incentives for attackers to strike.”

The entire report is available online here.