posted 12-16-2004 01:40 PM                    

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Michigan Wi-Fi hacker jailed for nine years
By Kevin Poulsen, SecurityFocus
Published Thursday 16th December 2004 11:26 GMT

A 21-year-old Michigan man was sentenced to nine years in federal prison yesterday in federal court in Charlotte, North Carolina for his role in a failed scheme to steal credit card numbers from the Lowe's chain of home improvement stores by taking advantage of an unsecured Wi-Fi network at a store in suburban Detroit.

Brian Salcedo faced a possible sentence of 12 to 15 years under federal sentencing guidelines, but at the government's urging federal judge Lacy Thornburgh gave the hacker credit for helping out his former victim following his guilty plea last June, according to the prosecutor on the case.
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"He provided assistance to Lowe's," says assistant US attorney Matthew Martens. "He met with the corporation to help them understand the vulnerabilities in their system and how they can improve and protect themselves from hackers in the future."

Salcedo's partner in the caper, 21-year-old Adam Botbyl, has also pleaded guilty and is scheduled for sentencing Thursday. He faces 41 to 51 months in prison - a sentence that could also be reduced if he's given credit for co-operating. In an interview last August, Botbyl told SecurityFocus he regretted participating in the scheme. "It's going to take a lot to start to get my reputation back," he said. "This has messed up my entire life for at least 10 or 15 years. It'll be at least 2010 before I can even touch a computer again."

It was Botbyl who first stumbled across an unsecured wireless network at the Southfield, Michigan Lowe's in the spring of 2003, while he and a roommate were driving around charting wireless networks with their laptop computers - the geek sport of "wardriving".

Six months later, Botbyl and his friend Salcedo - who was on the last month of a three year probation term from a juvenile computer crime conviction - hatched a plan to use the network to steal credit card numbers from the hardware chain, according to court records.
Wi-Fi Stakeout

The hackers used the wireless network to route through Lowe's corporate data center in North Carolina and connect to the local networks at stores in Kansas, North Carolina, Kentucky, South Dakota, Florida, and two stores in California. At two of the stores - in Long Beach, California and Gainseville, Florida - they modified a proprietary piece of software called "tcpcredit" that Lowe's uses to process credit card transactions, building in a virtual wiretap that would store customer's credit card numbers where the hackers could retrieve them later.

At some point, Lowe's network administrators and security personnel detected and began monitoring the intrusions, and called in the FBI. In November, 2003 a Bureau surveillance team staked out the Southfield Lowe's parking lot and spotted the two hackers working from Botbyl's Pontiac Grand Prix.

After 20 minutes, the pair quit for the night, and the FBI followed them to a Little Ceasar's pizza restaurant, then to a local multiplex. While the hackers took in a film, Lowe's network security team pored over log files and found the bugged program, which had collected only six credit card numbers.

The FBI eventually arrested Botbyl, Salcedo, and Botbyl's roommate, Paul Timmins, and charged them as conspirators. Timmins was later exonerated, but plead guilty to a misdemeanor for checking his e-mail over Lowe's network.

Even reduced, Salcedo's prison term is unusually harsh for a computer crime. The sentence is based largely on a stipulation in Salcedo's plea agreement with prosecutors that the losses in the abortive caper would have exceeded $2.5m. "The damage that Mr. Salcedo could have caused the consumers if he was successful could have been astounding," says prosecutor Martens.

Salcedo's defense attorney, Samuel Winthrop, did not return phone calls.

With credit for time served and good behavior, Salcedo will be eligible for release in the fall of 2011.

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posted 12-16-2004 02:09 PM                       

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Even reduced, Salcedo's prison term is unusually harsh for a computer crime.

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But I'd imagine it's around average for making a serious attempt to steal $2.5 million. It's good to see that the authorities are going after criminals who have the potential to cause real damage rather than easy target spotty teenage hackers whose activities are irritating but rarely anything more. Nice one FBI!

posted 12-17-2004 11:35 AM                    

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"He provided assistance to Lowe's," says assistant US attorney Matthew Martens. "He met with the corporation to help them understand the vulnerabilities in their system and how they can improve and protect themselves from hackers in the future."

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