Dropbox Users: The Latest Possible Cyberattack Victims

'Dropbox Hacker' Threatens To Leak 7 Million Passwords

By Steve Kovach

Nearly 7 million Dropbox usernames and passwords have been hacked, apparently via third-party services that hackers were able to strip the login information from.

The Next Web was the first to notice the leak on a site called Pastebin, where hackers have already leaked about 400 accounts. The hackers promise to release more accounts in return for Bitcoin donations. The hackers claim to have over 6.9 million email addresses and passwords belonging to Dropbox users.

In a statement, Dropbox denied it was hacked:

Dropbox has not been hacked. These usernames and passwords were unfortunately stolen from other services and used in attempts to log in to Dropbox accounts. We'd previously detected these attacks and the vast majority of the passwords posted have been expired for some time now. All other remaining passwords have expired as well.

That means Dropbox has already expired the 400 logins that have been leaked so far. But it's unclear if the logins of the nearly 7 million other Dropbox users the hackers claim to have are still safe. A Dropbox spokesperson told Business Insider that Dropbox consistently expires passwords for accounts that are being attacked, but couldn't provide a number of accounts expired recently. That means it's possible that there are nearly 7 million other Dropbox accounts still vulnerable.

It's a similar response to the one Snapchat had when hackers were able to obtain about 100,000 photos from the service through a third-party app. Snapchat claimed its servers weren't hacked, but the servers of a third-party app designed to save Snapchat photos were.

The real problem in both cases appears to be the way popular services allow users to log in. Even though Dropbox's own servers weren't hacked, the service still allows third parties access. It's also possible for hackers to hack other sites and cross reference the login information with services like Dropbox since many people use the same logins for multiples services. Those third parties have become the target for hackers to obtain personal information. Assuming the hackers do have the login information for 7 million Dropbox accounts, it's unclear how they were able to associate that information from a third-party service and apply it to Dropbox. A Dropbox spokesperson couldn't elaborate.

This is an alarming trend. Services like Dropbox, Snapchat, and Apple (AAPL) have pushed blame on users and other third parties following recent hacks when it's clear they're not doing enough to scrutinize the kinds of apps that have access to their platforms or guarantee users their logins won't be "expired" of their information is compromised.

Why Your Bank Thinks Someone Stole Your Credit Card
See Gallery
Dropbox Users: The Latest Possible Cyberattack Victims

One reason why Marquis' gas purchases might have triggered a fraud lockdown? Filling their tank is a common first move for credit card thieves.

"Some of the things they look at are small-dollar transactions at gas stations, followed by an attempt to make a larger purchase," explains Adam Levin of Identity Theft 911.

The idea is that thieves want to confirm that the card actually works before going on a buying spree, so they'll make a small purchase that wouldn't catch the attention of the cardholder. Popular methods include buying gas or making a small donation to charity, so banks have started scrutinizing those transactions.

Of course, it's not a simple matter of buying gas or giving to charity -- if those tasks triggered alerts constantly, no one would do either with a credit card. But Levin points to another possible explanation: Purchases made in a high-crime area are going to be held to a higher standard by the bank.

"It's almost a form of redlining," he says. "If there are certain [neighborhoods] where they've experienced an enormous amount of fraud, then anytime they see a transaction in the neighborhood, it sends an alert."

(Indeed, Erin tells me that one of the gas purchases that triggered an alert took place in a rough part of Detroit, which she visited specifically for the cheap gas.)

People who steal credit cards and credit card numbers usually aren't doing it so they can outfit their home with electronics and appliances. They don't want the actual products they're fraudulently buying; they're just in it to make money. So banks are always on the lookout for purchases of items that can easily be re-sold.

"Anytime a product can be turned around quickly for cash value, those are going to be the items that you would probably assume that, if you were a thief, you would want to get to first," says Karisse Hendrick of the Merchant Risk Council, which helps online merchants cut down on fraud. Levin says electronics are common choices for fraudsters, as are precious metals and jewelry.

Many thieves don't want to go through the rigmarole of buying laptops and jewelry, then selling them online or at pawnshops. They'd much prefer to just turn your stolen card directly into cold, hard cash.

There are a few ways that they can do that, and all of them will raise red flags at your bank or credit union. Using a credit card to buy a pricey gift card or load a bunch of money on a prepaid debit card is a fast way to attract the suspicions of your credit card issuer. Levin adds that some identity thieves also use stolen or cloned credit cards to buy chips at a casino, which they can then cash out (or, if they're feeling lucky, gamble away).

When assessing whether a purchase might be fraudulent, banks aren't just looking at what you bought and where you bought it. They're also asking if it's something you usually buy.

"The issuers know the buying patterns of a cardholder," says Hendrick. "They know the typical dollar amount of transaction and the type of purchase they put on a credit card."

Your bank sees a fairly high percentage of your purchases, so it knows if one is out of character for you. A thrifty individual who suddenly drops $500 on designer clothes should expect to get a call -- or have to make one when the bank flags the transaction. If you rarely travel and your card is suddenly used to purchase a flight to Europe, that's going to raise some red flags.

Speaking of Europe, the other big factor in banks' risk equations is whether you're making a purchase in a new area. I bought a computer just days after moving from Boston to New York, and had to confirm to the bank that I was indeed trying to make the purchase. Levin likewise says that making purchases in two different cities over a short period of time raises suspicions.

"I go from New York to California a lot, and invariably someone will call me [from the bank], " he says. Since one person can't go shopping in New York and California at the same time, any time a bank sees multiple purchases in multiple locations in a short period, it's going to be suspicious.

Read Full Story