Google and an assortment of partners shut down a botnet that an approved Android device manufacturer purposefully deployed across more than 1.3 million TV set-top boxes, the company said Monday. 

Videostrong Technology Co., a China-based Android original equipment and device manufacturer, implanted a backdoor into multiple devices it sold. Those backdoors established XCPE, an expansive botnet that cybercriminals used to conduct ad fraud, steal data and route malicious traffic through residential proxy networks, according to a Google Threat Intelligence Group report.

Google took legal action to shut down the domains and servers Videostrong used to control the botnet. The company also took down command-and-control domains that more than a dozen malware families ran as modules through the XCPE backdoor, claiming it disrupted access to at least 10 million additional compromised devices from various manufacturers.

Videostrong sold Android devices with pre-installed malware for years, slipping by Google’s security tests by loading the malicious code after the device’s first boot. “The XCPE operators constantly evolved its configurations to evade Google’s pre and post-launch detections,” Charley Snyder, head of disruption operations at GTIG, told CyberScoop.

Snyder declined to say when or how Google first became aware of the approved vendor running a botnet on Android-powered devices. 

“We found this malicious software built directly into many different device models and brands over multiple years, supported by dedicated infrastructure and constantly evolving configurations to evade detection and manage their affiliates,” Google researchers wrote in the report. “We believe this campaign wasn’t an isolated rogue insider or a development oversight.”

Google banned Videostrong and any future subsidiaries from building or selling certified Android devices, and said it changed its review process to detect and stop similar activities in the future. Yet, Snyder said the company isn’t sharing specifics on these changes because it doesn’t want to provide threat actors insights that might help them circumvent these additional protections.

Most of the devices comprising the XCPE botnet were Android TV set-top boxes, but researchers also observed infected Android-based telehealth devices, karaoke machines and digital signs. 

“Without users’ knowledge or consent, infected devices were offered as a distribution mechanism for a wide array of criminal actors,” researchers wrote in the report. “This led to a variety of malicious activities being conducted on and through the devices, including ad-fraud, data exfiltration, and routing malicious network traffic through the devices.”

The botnet spanned more than 170 countries, with the largest concentration of infected devices based in Malaysia, Brazil, Iraq, Mexico and Taiwan, according to TrendAI researchers. Nearly 44,000 infected devices were based in the United States between June and October.

Google also partnered with Japan’s National Police Agency, Lumen Technologies, Human Security, Plume and Synthient to study and disrupt the botnet. 

The company said the dismantling of XCPE “seriously impacted over a dozen malicious actors,” yet it warned that the underlying market for backdoors, ad fraud and residential proxy networks are resilient and operating as an interconnected supply chain.

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Botnets powered by residential proxy networks are proliferating, enabling cybercriminals of all types to evade detection by blending in with seemingly legitimate traffic, Lumen Technology’s Black Lotus Labs said in a report Friday.

The global scale of botnets observed by Lumen is currently approaching 60 million victim IP addresses, Chris Formosa, senior lead information security engineer at Black Lotus Labs, told CyberScoop. Roughly 1 in 4 of those compromised IPs are based in the United States, and the true number of infected devices is much greater because there are networks beyond Lumen’s visibility and multiple devices are often unknowingly running a malicious proxy network on the same IP. 

Super-sized botnets are also gaining momentum, according to Lumen, with an average of 10 distinct botnets controlling their own populations of about 1 million active victims daily.

“The only reason these botnets keep getting more and more victims is because there is clearly a market. Aside from criminal activity, who wants access to millions of IPs regularly?” Formosa said. 

That demand for botnets fuels opportunities for growth, reselling, collaboration, and quick rebounds following massive disruptions.

IPIDEA, one of the largest residential proxy networks in operation when its infrastructure was disrupted by coordinated strikes in January, recovered at nearly half-strength within hours and earlier this surpassed its pre-disruption botnet size with a current botnet population of about 10 million IPs, researchers said.

“Their rebuild was eye-opening as they began to rebound from that interdiction,” Ryan English, information security engineer at Black Lotus Labs, told CyberScoop. “Even for how quickly some botnets can rebound, theirs was surprising. We’ve seen them all rebuild, but we haven’t seen anybody do it that fast.”

Meanwhile, botnets are continuously growing, as cybercriminals seek out the cover they provide, more cheap and poorly defended devices hit the market and vendors stop providing security updates for older but still usable products. 

“Your available pool for those proxy hunters grows every year, and it will continue to grow every year,” English said, adding that more than 1 billion devices are currently vulnerable and available to be unknowingly sucked up into botnets.

The challenge for defenders is lopsided, and while disruptions and seizures occur relatively often, botnet operators have formed a global supply chain with pathways that are difficult to break. 

“We have observed multiple residential proxy services collaborating to form what amounts to the largest cooperative network ever seen on the internet,” researchers wrote in the report.

Black Lotus Labs currently tracks more than 30 distinct malicious proxy botnet clusters, and most of those regularly boast more than 100,000 daily victims.

“Our understanding of the various botnets in this space, along with experience in multiple disruptions, leads us to a very important conclusion: taking down a single malicious proxy provider or their botnet in isolation is likely to result in a short-lived solution,” researchers wrote. 

“In recent years, the malicious proxy environment has essentially created the largest collective botnet currently active on the internet, capable of moving millions of IPs within hours to wherever they are needed,” they added. “Until the malicious proxy landscape is properly addressed and regulated on both the private industry and law enforcement sides, this issue will grow and, along with the DDoS botnet landscape, will most likely become a greater problem in the long term.”

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