Cyber Extortion Demands Big Money

mark phillips, cyber-extortion, million dollar home page

You may remember young Alex Tew, the frighteningly clever 21 year old who made a quick million by selling advertising space — a dollar at a time — on his $1-million homepage. Well, a funny thing happened to Alex on his way to the bank.

"I got an e-mail from some people that said we have the ability to take down your site," Alex says.

Which they did. CBS News correspondent Mark Phillips reports the $1-million homepage was becoming the $50,000 shakedown.

"It said 'We want $50,000. The site's down, if you want it back online, pay $50,000,'" Alex says.

Alex refused to pay and instead spent a few thousand dollars on electronic site protection. Fifty-thousand here, $50,000 there, he thought, and pretty soon you're talking real money.

"It's the Internet form of terrorism," Alex says. "If you pay up, you open yourself up to more attacks."

In fact, with the publicity this Web site has had, it would have been more surprising if Alex Tew's site hadn't been attacked. Internet extortion, Internet terrorism — call it what you like — has become a growth industry for two good reasons: It's easy and it's almost impossible to catch the crooks.

For one thing, Tew's attackers are probably on the other side of the world, very likely Russia, where the anti-computer crime 'K' department has had occasional success hacking into the hackers.

In video footage, they bust a man who'd held up an international gambling operation using one of the more popular techniques — attacking the site with thousands of virus-infected "zombie" computers, without the knowledge of their owners.

'K' department cops like Anatoly Platonov say there have been similar attacks in more than 50 countries, doing more than $30 million in damage to businesses. People in Internet commerce here say Russia has become a center of this new type of crime partly because of an old attitude.

"In America, you have not so many rules, but everybody expects every rule to be followed," says Ron Lewin, a Russian Internet business specialist. "In Russia, you have many rules, but if you break the rules, it's not so bad."

Especially when the risk-to-reward ratio so heavily favors reward. The culprits are very good at covering their electronic tracks across the Web and across borders.

"The Internet is a trash heap — the Russian cops say — you come across every crime except rape and murder," Platonov says.

Just ask million-dollar-boy Alex Tew.

"It's just like being robbed," Alex says. "It's just crime at the end of the day and if you give into them you kind of perpetuate the problem. You've got to stand firm."

Something you can afford to do if you've just made a million dollars.