Fishy Android apps may have been malware, says researcher

Suspicious applications that may have stolen users' online banking credentials have appeared on the Android Market, the Google-run app store for its mobile operating system.

Although the potentially-malicious applications first appeared on Google 's online mart in December, news of them went public only today as several outlets and security companies noticed warnings posted by banks and credit unions. Google has since removed the applications from the online market .

One of those financial institutions, BayPort Credit Union of Newport News, Va., posted its alert Dec. 22 about a rogue Android app that promised its members easy access to their online banking. "It is believed that fraudsters deployed fraudulent mobile banking applications to the Android Marketplace, using a phishing technique to attempt to gain access to mobile banking users financial information," said BayPort's warning .

First Tech Credit Union of Portland Ore. -- it also has branches in Salem and Eugene, Ore., as well as in the Seattle, Wash. area -- issued a similar warning the same day.

BayPort said it notified Google of the bogus application on Dec. 15, and that Google removed not only that program, but over 50 similar apps, all written by a single developer identified only as "09Droid."

But security researchers have not been able to confirm that the Android apps were, in fact, malicious. "We've trying to get copies," said Mikko Hypponen, the chief research officer of Helsinki-based F-Secure, who added that the attempt has been unsuccessful thus far, primarily because Google yanked the applications from Android Market. "But it's possible that they didn't do anything directly malicious."

Hypponen based his speculation on several facts, including that 09Droid was responsible for "dozens of these applications."

"Lots could be going on here," he said. "09Droid may simply have been trying to cash in by offering apps that do nothing but provide a shortcut to the online bank's site, which the user could reach himself in the browser."

Under that scenario, 09Droid was out for a quick buck -- literally -- by charging users 99 cents for applications that, while harmless, only added a shortcut icon to the phone's desktop.

"It's perfectly possible that they are malicious, but I think it's pretty unlikely that someone would target this many banks and credit unions at the same time with an Android-based attack," Hypponen said. Data from Web metrics company Net Applications backs up his point that Android is still a very small target. Last month, Android accounted for only 0.02% of all operating systems that powered hardware used to connect to the Internet.

Even if the banking application is only of dubious value, not malware, Hypponen expects malicious Android apps to appear. "I think it's likely," he said when asked of the possibility. "But I also think it's also likely that Google will quickly pull the application from the marketplace."

Unlike Apple , which runs its App Store for the iPhone, Google does not vet Android applications that appear in its online store. That's a security risk, said Hypponen, but he urged users not to overreact.

"That's the way things are for Windows," he pointed out. "Nothing is approved by anybody, and it's worked very well for Microsoft ."

An approval process for mobile applications "obviously has huge security benefits," Hypponen added, "but there's a trade-off, too." Among the negatives, Hypponen ticked off slower development and a single gatekeeper for all approved software. "On an iPhone, for example, you have to go through the App Store unless you 'jailbreak' your phone," he said. "But that opens tons more security problems."

That was the case last November, when the "ikee" worm was able to infect only iPhones that had been jailbroken, or hacked so that their owners could install software not approved by Apple.

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