Paypal Scam #3

New worm W32/Mimail-I uses PayPal scam to spread on the Internet

A new e-mail worm is spreading on the Internet and posing as a message from PayPal Inc. in an effort to harvest credit card numbers and account passwords. W32/Mimail-I is a new version of the Mimail worm, which first appeared in August, and is believed to be the first e-mail worm specifically designed to steal personal financial and account information.

Mimail-I first appeared late yesterday in what antivirus experts believe was a massive e-mail "seeding," in which spam programs are used to distribute messages containing the virus attachment, according to Craig Schmugar, a virus research engineer at McAfee Anti-Virus Emergency Response Team, (part of Network Associates Inc.).

Like earlier editions of Mimail, the I-variant can also spread by itself. The worm contains its own SMTP (Simple Mail Transfer Protocol) e-mail engine and harvests e-mail addresses from victims' computers. Unlike earlier versions of Mimail, MiMail-I contains a message that tells recipients that their PayPal account will soon expire and that they need to re-enter their credit card information through "our secure application," referring to the executable file attached to the e-mail message.

When users click on the file attachment, the worm opens a window on their desktop that displays the PayPal logo and contains fields for entering their PayPal account password and credit card information. Information that is entered into the fields is sent to four e-mail accounts belonging to Internet domains in the Czech Republic. Typically, phisher scams use spam to drive unwitting Internet users to phony Web sites, where their information is captured.

In July, the FBI and Internet service provider EarthLink Inc. warned about a spike in such scams since the beginning of 2003. Coupling such scams with a self-spreading e-mail worm is a new twist and is probably designed to increase the number of potential victims exposed to the scam. However, the new worm's similarity to earlier versions of e-mail scams, coupled with the suspicious attachment and poor spelling probably mean that Mimail-I will not create a large number of new identity-theft victims.