Discussions amongst members of a popular Russian cybercrime forum have been focused on the best methods of offsetting the significantly reduced sales volume of stolen goods imported to Russia. Not that long ago, Russians, together with the Chinese, Indians, and Brazilians, were considered up and coming spenders, willing to dole out significant sums of money on the latest consumer technology products, designer clothes, and luxury cars. Very few in the cybercriminal community anticipated that the situation might change so quickly. The rapid decrease in consumers’ buying power, caused by a two-fold devaluation of the Ruble, a sudden decrease in oil prices, coupled with Western sanctions implemented after the annexation of Crimea, sent the Russian economy into rapid decline.
It was estimated that the annual turnover of shadow operators of re-shipping schemes specializing in the purchase of deeply discounted commodities obtained with compromised financial information and exported to Russia for resale could have reached several hundreds of millions of dollars. Hefty import taxes levied against all legitimate importers often made Western products significantly more expensive within Russia compared to the European and American markets, providing even better returns for criminals.
Previously, for example, a cybercriminal used stolen credentials to buy a $1,000 item, paid $50 to re-ship and $70 to buy a shipping label to Russia. In Russia, the item was delivered to a local student-reseller and sold slightly below Russian market price (usually 110%-115% of the list price). The reseller’s cut is between 10% and 15%. The cybercriminal cleared $850 or $1,100 less $130 reseller cut and less $50 and $70 for shipping. It used to be the case that everything was sold within a couple of weeks.
Today, the environment in Russia is different. Items that used to sell within weeks now take six months to turn over. In addition, items that used to sell for 115% of list price now sell at 90%. So instead of clearing $850 on a $1,000 item, the net is only $680 or 68% of US list.
Few, if any, within the Russian cybercriminal scene anticipated that the well-oiled, decades-old industry of re-shipping fraud might fall on such hard times. Nevertheless, fraudsters are establishing new sales channels within the US and European markets. Inevitably, the vast numbers of stolen goods previously sold overseas will find their way to local consumers through popular marketplaces such as eBay, Amazon, and Craigslist. Ironically, some items may become more affordable as fraudsters try quickly to liquidate stock, potentially resulting in significantly lowered prices, and thus returns.