Malicious worm attacks, steals data from jailbroken iPhones

It is estimated that hundreds of users are currently affected by a worm that targets users of "jailbroken" iPhones who live in the Netherlands and use the bank ING Direct. But security company F-Secure told the BBC that the currently isolated issue could easily jump to thousands of handsets. The worm is reportedly spread between phones when they share the same Wi-Fi spot.

In order for an iPhone to be vulnerable to the new worm, they must have willingly modified their handset's software to allow them to run unauthorized code. Phones can be jailbroken to run applications or modify the system in ways not approved by Apple.

The worm only affects jailbroken phones that have SSH (secure shell) installed, without the default password — "alpine" — changed. It employs the same method as a previous worm, Ikee, that was not malicious. Instead, the wallpaper-changing prank simply changed the user's background to a picture of 1980s pop star Rick Astley, who sang the 1987 hit "Never Gonna Give You Up."

But the new worm reportedly has botnet functionality and connects to a Web-based command and control center based in Lithuania.

For now, the worm is only aimed at customers who live in the Netherlands and bank with ING Direct. The online bank intends to put a warning on its Web site.

This summer, a text messaging exploit was discovered by security researcher Charlie Miller that could allow someone to take control of the iPhone. Apple quickly fixed the issue. The exploit exposed the iPhone completely, giving hackers access to the camera, dialer, messaging and Safari.