E-payment Provider Hit With Denial-of-Service

An online payment processor's Web site has recovered from a two-day denial-of-service (DoS) attack that knocked it out of commission, a U.K.-based Internet performance measuring company said over the weekend.

StormPay.com's site was unavailable for several hours late Thursday and most of Friday, said Netcraft, when it was overwhelmed by a DoS that aimed as much as 6 gigabytes of data a second at the URL.

"StormPay is currently suffering from DDOS (Distributed Denial of Service) attacks which prevent StormPay from sending or receiving email communications as well as prevents customers from being able to access their StormPay account’s through the StormPay.com website," said the Clarksville, Tn.-based processor in a Saturday statement. "Federal authorities are investigating the origination of the attacks and have confirmed that they are very close to making arrests."

StormPay acknowledged media reports of last week that said the provider had frozen accounts of users of 12daily-Pro.com, a so-called "Auto-Surf" Web site that is under investigation by the FBI and Securities and Exchange Commission (SEC). StormPay is also used by many Web hosting providers to process payments for recurring services. It's suffered less extensive outages in the past; the most recent was in mid-January.

Richard Stiennon, director of threat research for Boulder, Colo.-based security company Webroot, suspects that a digital extortionist is at work.

"Cyber extortionists go after high transaction volume sites because they are the most likely targets to cough up money rather than see an outage," Stiennon wrote on his blog. "If you rely on your Web site for a significant amount of business, beware. You will eventually be targeted by these guys."

Auto-Surf sites such as 12daily-Pro.com are under scrutiny from investigators for Ponzi scheme-like characteristics. Named for Charles Ponzi, who gained notoriety in the 1920s, a Ponzi scheme is a fraud that promises outrageous investor returns but pays them with money from new investors rather than revenue actually generated by the business. A contemporary once wrote "Ponzi is the guy who put the crease in Croesus."

12daily-Pro.com and other Auto-Surf sites typically promise large returns to members who agree to view their ads. One competitor, SurfCityAutoSurf.com, claims "Yes, it's true, you can actually earn up to $100.00 Daily or $3,200 Monthly simply by autosurfing (watching websites)."

In a front-page story in the Wall Street Journal last week, a law-enforcement official was quoted as saying that "a significant number of people" likely lost millions of dollars in the Ponzi scheme put on by 12daily-Pro.com.

12daily-Pro.com remains up and running. On Monday, a message that headed the membership forums struck back at reports of impropriety.

"Here you will read the truth about our program as written by our members who are doggedly supporting us," the message read. "The media would rather spend their time telling lies about us than helping our members get their stolen funds back from StormPay."

A message by someone identifying themselves as "Charis" and the overall administrator of the 12daily-Pro.com member forums, said that the company was "cooperating fully with all investigations."