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BizReport : Research archives : July 23, 2010

Reports: Click fraud, captcha breakers threatening brands

There is no rest for the wicked in the online space. New research from Click Forensics and MessageLabs finds that fraudsters continue to work overtime to obtain consumers' private information from both paid search and email advertisers.

by Kristina Knight

First, the details from Click Forensics. Their report finds that click fraud increased by about 1% from Q1 2010 to Q2 2010 to reach 18.6% overall; year over year, the increase was more than six percentage points. The countries with the highest rates of click fraud include Singapore, Pakistan and Japan.

"Over the past several quarters, we've seen the overall click fraud rate slowly trending higher," said Paul Pellman, CEO of Click Forensics. "The main reasons appear to be the continued sophistication of botnets and malware prevalent in the fast-growing search marketing space. We advise online marketers to be watchful of their campaigns as they spend more on search advertising in the coming quarters."

In a related report, MessageLabs finds that CAPTCHA breaking is also on the increase, with more and more fraudsters employing both software and people to break CAPTCHAs to create email accounts with which to send spam or phish for consumer information.

"Breaking [CAPTCHAs] has unlocked the business potential of the so-called 'shadow economy'...[criminals] stand to make a lot of money from the free email accounts they've been able to harvest from popular account providers through cracking the CAPTCHA system," writes Jason Zhang, Senior Software Engineer with Symantec Hosted Services.

The big benefit for fraudsters who break CAPTCHAs related to email accounts is that they can then spam or phish from seemingly innocent email addresses to obtain private information from unwitting consumers.

Tags: Click Forensics, click fraud, email marketing, MessageLabs, paid search, phishing, search marketing, spam

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  • The increase in bots breaking CAPTCHAs shows the ineffectiveness of the text-based CAPTCHAs that are used on most websites and Webmail services today. Bots can easily "read" the distorted letters and words using optical character recognition (OCR) or break the CAPTCHA using a dictionary attack.

    A more effective type of CAPTCHA is picture-based. Such as this: http://demo.confidenttechno...

    Bots are not able to effectively understand the semantic meaning of the instructions and then identify the subjet of the random pictures (i.e. "Click on the picture of the dog.") It's much better at stopping bots and more user-friendly for humans at the same time.



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