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KARLS Ransomware

Also Known As: KARLS virus
Damage level: Severe

What is KARLS?

Discovered by Jakub Kroustek, KARLS is one of many malicious programs developed by cyber criminals. This particular one is categorized as a ransomware-type program. KARLS is a new variant of Dharma and is designed to encrypt data (make files inaccessible) and display ransom messages.

Each affected (encrypted) file is renamed by adding an additional ".KARLS" extension. For example, "1.jpg" becomes "1.jpg.id-1E857D00.[karlosdecrypt@outlook.com].KARLS". It also inserts an email address and a unique ID into the filename. Ransom demand messages can be found in the pop-up window and a text file called "FILES ENCRYPTED.txt".

The "FILES ENCRYPTED.txt" file contains a message stating that all KARLS victim files have been encrypted. To decrypt them, users are required to contact the developers via the karlosdecrypt@outlook.com or karlosdecrypt24@airmail.cc email address. 

Another ransom note (presented in the pop-up window) informs ransomware victims that files were encrypted due to problems with computer security. To retrieve the files, cyber criminals urge victims to send an email using one of the provided addresses. The message must include the assigned unique ID.

They encourage victims to do this as quickly as possible, since the elapsed time will determine the cost of the decryption/decryption tool. KARLS developers promise to send the tool once they receive payment (in a cryptocurrency). Once contacted, they are likely to provide a Bitcoin wallet address that will be used to pay the ransom.

These cyber criminals offer free decryption of one file as 'proof' that they have the tool capable of decryption. They also inform victims that none of the files should be renamed and no third party tools used to decrypt files. According to KARLS's developers, this might cause permanent data loss or increase the cost of decryption.

Note that cyber criminals (ransomware developers) often ignore their victims once they receive the ransom payment. They cannot be trusted. To encrypt data, they mostly use cryptography algorithms (symmetric or asymmetric) that make decryption without their involvement impossible.

In most cases, the only tool capable of decryption is stored on servers that can only be accessed by specific ransomware developers. Therefore, when a computer is infected with ransomware, the only way to restore files free of charge is using a data backup that was created before encryption.

Screenshot of a message encouraging users to pay a ransom to decrypt their compromised data:

KARLS decrypt instructions

There are many programs of this type. Examples of other ransomware-type infections are Clop, DESYNC, and Pluto. Most are similar: they encrypt data and make ransom demands. The main differences are usually cost of decryption/decryption tool or key and the cryptography used to encrypt files stored on the computer.

Unfortunately, most ransomware developers design these programs to be 'uncrackable'. Therefore, data is impossible to decrypt without using the correct tool. Decryption is only possible if the ransomware-type program is not finished, contains bugs, flaws etc. Therefore, maintain data backups and store them on remote servers or unplugged storage devices.

How did ransomware infect my computer?

Typically, cyber criminals proliferate ransomware-type infections through spam campaigns (emails) and other malicious programs such as Trojans, unofficial software download channels, software cracking tools, and fake software updaters. When employed by cyber criminals, spam campaigns deliver emails that contain infected/malicious attachments.

Attached files might be Microsoft Office documents, PDF documents, archive files (ZIP, RAR and others), executables (.exe files), JavaScript files, and so on. The main goal is to trick recipients into downloading and opening them. This leads to installation of ransomware or other high-risk computer infections. Trojans are are capable of causing chain infections.

If installed, these programs proliferate other malicious programs. Unofficial software download sources such as freeware download websites, free file hosting sites, Peer-to-Peer networks (torrents, eMule etc.) are used to proliferate malicious software. Cyber criminals present infected files as legitimate.

In summary, by downloading files using such sources, users often cause installation of viruses rather than the expected software. Software cracking tools bypass software activation free of charge.

These tools allow people to use paid software free of charge, however, in many cases, cyber criminals employ them to proliferate ransomware. Fake/unofficial software updaters cause computer infections by downloading malicious programs rather than the updates or by exploiting bugs or flaws of outdated software.

Threat Summary:
Name KARLS virus
Threat Type Ransomware, Crypto Virus, Files locker
Symptoms Can't open files stored on your computer, previously functional files now have a different extension, for example my.docx.locked. A ransom demanding message is displayed on your desktop. Cyber criminals are asking to pay a ransom (usually in bitcoins) to unlock your files.
Distribution methods Infected email attachments (macros), torrent websites, malicious ads.
Damage All files are encrypted and cannot be opened without paying a ransom. Additional password stealing trojans and malware infections can be installed together with a ransomware infection.
Malware Removal (Windows)

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How to protect yourself from ransomware infections?

The key to safe computing is caution. To avoid various infections, download, install, update software, and browse the web with care. Avoid using third party software downloaders/installers and other such tools (mentioned earlier). Download software using only official and trustworthy websites (or other download channels).

It is also important to update installed software using implemented functions or tools provided by official software developers. Handle web links or attachments presented in emails received from unknown/suspicious email addresses with care. Do not open them without making sure it is safe to do so.

Dubious emails are often irrelevant but presented as important and legitimate. Use of software cracking tools is classed as a cyber crime. Furthermore, rather than providing any software activation, these tools install malicious programs. Have reputable anti-spyware/anti-virus software installed and keep it enabled at all times.

These tools detect threats and eliminate them before they can proliferate or cause any damage. If your computer is already infected with KARLS, we recommend running a scan with Combo Cleaner Antivirus for Windows to automatically eliminate this ransomware.

Text presented in KARLS ransomware pop-up window:

All your files have been encrypted!
All your files have been encrypted due to a security problem with your PC. If you want to restore them, write us to the e-mail karlosdecrypt@outlook.com
Write this ID in the title of your message 1E857D00
In case of no answer in 24 hours write us to theese e-mails:karlosdecrypt24@airmail.cc
You have to pay for decryption in Bitcoins. The price depends on how fast you write to us. After payment we will send you the decryption tool that will decrypt all your files.
Free decryption as guarantee
Before paying you can send us up to 1 file for free decryption. The total size of files must be less than 1Mb (non archived), and files should not contain valuable information. (databases,backups, large excel sheets, etc.)
How to obtain Bitcoins
The easiest way to buy bitcoins is LocalBitcoins site. You have to register, click 'Buy bitcoins', and select the seller by payment method and price.
https://localbitcoins.com/buy_bitcoins
Also you can find other places to buy Bitcoins and beginners guide here:
http://www.coindesk.com/information/how-can-i-buy-bitcoins/
Attention!
Do not rename encrypted files.
Do not try to decrypt your data using third party software, it may cause permanent data loss.
Decryption of your files with the help of third parties may cause increased price (they add their fee to our) or you can become a victim of a scam.

Screenshot of KARLS text file "FILES ENCRYPTED.txt":

KARLS text file

Text presented in KARLS text file:

all your data has been locked us
You want to return?
write email karlosdecrypt@outlook.com or karlosdecrypt24@airmail.cc

Screenshot of files encrypted by KARLS (".KARLS" extension):

Files encrypted by KARLS

KARLS ransomware removal:

Instant automatic malware removal: Manual threat removal might be a lengthy and complicated process that requires advanced computer skills. Combo Cleaner is a professional automatic malware removal tool that is recommended to get rid of malware. Download it by clicking the button below:
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Video suggesting what steps should be taken in case of a ransomware infection:

Quick menu:

Reporting ransomware to authorities:

If you are a victim of a ransomware attack we recommend reporting this incident to authorities. By providing information to law enforcement agencies you will help track cybercrime and potentially assist in the prosecution of the attackers. Here's a list of authorities where you should report a ransomware attack. For the complete list of local cybersecurity centers and information on why you should report ransomware attacks, read this article.

List of local authorities where ransomware attacks should be reported (choose one depending on your residence address):

Isolating the infected device:

Some ransomware-type infections are designed to encrypt files within external storage devices, infect them, and even spread throughout the entire local network. For this reason, it is very important to isolate the infected device (computer) as soon as possible.

Step 1: Disconnect from the internet.

The easiest way to disconnect a computer from the internet is to unplug the Ethernet cable from the motherboard, however, some devices are connected via a wireless network and for some users (especially those who are not particularly tech-savvy), disconnecting cables may seem troublesome. Therefore, you can also disconnect the system manually via Control Panel:

Navigate to the "Control Panel", click the search bar in the upper-right corner of the screen, enter "Network and Sharing Center" and select search result: Disconnecting computer from the Internet (step 1)

Click the "Change adapter settings" option in the upper-left corner of the window: Disconnecting computer from the Internet (step 2)

Right-click on each connection point and select "Disable". Once disabled, the system will no longer be connected to the internet. To re-enable the connection points, simply right-click again and select "Enable". Disconnecting computer from the Internet (step 3)

Step 2: Unplug all storage devices.

As mentioned above, ransomware might encrypt data and infiltrate all storage devices that are connected to the computer. For this reason, all external storage devices (flash drives, portable hard drives, etc.) should be disconnected immediately, however, we strongly advise you to eject each device before disconnecting to prevent data corruption:

Navigate to "My Computer", right-click on each connected device, and select "Eject": Ejecting external storage devices

Step 3: Log-out of cloud storage accounts.

Some ransomware-type might be able to hijack software that handles data stored within "the Cloud". Therefore, the data could be corrupted/encrypted. For this reason, you should log-out of all cloud storage accounts within browsers and other related software. You should also consider temporarily uninstalling the cloud-management software until the infection is completely removed.

Identify the ransomware infection:

To properly handle an infection, one must first identify it. Some ransomware infections use ransom-demand messages as an introduction (see the WALDO ransomware text file below).

Identify ransomware-type infection (step 1)

This, however, is rare. In most cases, ransomware infections deliver more direct messages simply stating that data is encrypted and that victims must pay some sort of ransom. Note that ransomware-type infections typically generate messages with different file names (for example, "_readme.txt", "READ-ME.txt", "DECRYPTION_INSTRUCTIONS.txt", "DECRYPT_FILES.html", etc.). Therefore, using the name of a ransom message may seem like a good way to identify the infection. The problem is that most of these names are generic and some infections use the same names, even though the delivered messages are different and the infections themselves are unrelated. Therefore, using the message filename alone can be ineffective and even lead to permanent data loss (for example, by attempting to decrypt data using tools designed for different ransomware infections, users are likely to end up permanently damaging files and decryption will no longer be possible even with the correct tool).

Another way to identify a ransomware infection is to check the file extension, which is appended to each encrypted file. Ransomware infections are often named by the extensions they append (see files encrypted by Qewe ransomware below).

Identify ransomware-type infection (step 2)

This method is only effective, however, when the appended extension is unique - many ransomware infections append a generic extension (for example, ".encrypted", ".enc", ".crypted", ".locked", etc.). In these cases, identifying ransomware by its appended extension becomes impossible.

One of the easiest and quickest ways to identify a ransomware infection is to use the ID Ransomware website. This service supports most existing ransomware infections. Victims simply upload a ransom message and/or one encrypted file (we advise you to upload both if possible).

Identify ransomware-type infection (step 3)

The ransomware will be identified within seconds and you will be provided with various details, such as the name of the malware family to which the infection belongs, whether it is decryptable, and so on.

Example 1 (Qewe [Stop/Djvu] ransomware):

Identify ransomware-type infection (step 4)

Example 2 (.iso [Phobos] ransomware):

Identify ransomware-type infection (step 5)

If your data happens to be encrypted by ransomware that is not supported by ID Ransomware, you can always try searching the internet by using certain keywords (for example, a ransom message title, file extension, provided contact emails, crypto wallet addresses, etc.).

Search for ransomware decryption tools:

Encryption algorithms used by most ransomware-type infections are extremely sophisticated and, if the encryption is performed properly, only the developer is capable of restoring data. This is because decryption requires a specific key, which is generated during the encryption. Restoring data without the key is impossible. In most cases, cybercriminals store keys on a remote server, rather than using the infected machine as a host. Dharma (CrySis), Phobos, and other families of high-end ransomware infections are virtually flawless, and thus restoring data encrypted without the developers' involvement is simply impossible. Despite this, there are dozens of ransomware-type infections that are poorly developed and contain a number of flaws (for example, the use of identical encryption/decryption keys for each victim, keys stored locally, etc.). Therefore, always check for available decryption tools for any ransomware that infiltrates your computer.

Finding the correct decryption tool on the internet can be very frustrating. For this reason, we recommend that you use the No More Ransom Project and this is where identifying the ransomware infection is useful. The No More Ransom Project website contains a "Decryption Tools" section with a search bar. Enter the name of the identified ransomware, and all available decryptors (if there are any) will be listed.

Searching for ransomware decryption tools in nomoreransom.org website

Restore files with data recovery tools:

Depending on the situation (quality of ransomware infection, type of encryption algorithm used, etc.), restoring data with certain third-party tools might be possible. Therefore, we advise you to use the Recuva tool developed by CCleaner. This tool supports over a thousand data types (graphics, video, audio, documents, etc.) and it is very intuitive (little knowledge is necessary to recover data). In addition, the recovery feature is completely free.

Step 1: Perform a scan.

Run the Recuva application and follow the wizard. You will be prompted with several windows allowing you to choose what file types to look for, which locations should be scanned, etc. All you need to do is select the options you're looking for and start the scan. We advise you to enable the "Deep Scan" before starting, otherwise, the application's scanning capabilities will be restricted.

Recuva data recovery tool wizard

Wait for Recuva to complete the scan. The scanning duration depends on the volume of files (both in quantity and size) that you are scanning (for example, several hundred gigabytes could take over an hour to scan). Therefore, be patient during the scanning process. We also advise against modifying or deleting existing files, since this might interfere with the scan. If you add additional data (for example, downloading files/content) while scanning, this will prolong the process:

Recuva data recovery tool scan time

Step 2: Recover data.

Once the process is complete, select the folders/files you wish to restore and simply click "Recover". Note that some free space on your storage drive is necessary to restore data:

Recuva data recovery tool recovering data

Create data backups:

Proper file management and creating backups is essential for data security. Therefore, always be very careful and think ahead.

Partition management: We recommend that you store your data in multiple partitions and avoid storing important files within the partition that contains the entire operating system. If you fall into a situation whereby you cannot boot the system and are forced to format the disk on which the operating system is installed (in most cases, this is where malware infections hide), you will lose all data stored within that drive. This is the advantage of having multiple partitions: if you have the entire storage device assigned to a single partition, you will be forced to delete everything, however, creating multiple partitions and allocating the data properly allows you to prevent such problems. You can easily format a single partition without affecting the others - therefore, one will be cleaned and the others will remain untouched, and your data will be saved. Managing partitions is quite simple and you can find all the necessary information on Microsoft's documentation web page.

Data backups: One of the most reliable backup methods is to use an external storage device and keep it unplugged. Copy your data to an external hard drive, flash (thumb) drive, SSD, HDD, or any other storage device, unplug it and store it in a dry place away from the sun and extreme temperatures. This method is, however, quite inefficient, since data backups and updates need to be made regularly. You can also use a cloud service or remote server. Here, an internet connection is required and there is always the chance of a security breach, although it's a really rare occasion.

We recommend using Microsoft OneDrive for backing up your files. OneDrive lets you store your personal files and data in the cloud, sync files across computers and mobile devices, allowing you to access and edit your files from all of your Windows devices. OneDrive lets you save, share and preview files, access download history, move, delete, and rename files, as well as create new folders, and much more.

You can back up your most important folders and files on your PC (your Desktop, Documents, and Pictures folders). Some of OneDrive’s more notable features include file versioning, which keeps older versions of files for up to 30 days. OneDrive features a recycling bin in which all of your deleted files are stored for a limited time. Deleted files are not counted as part of the user’s allocation.

The service is built using HTML5 technologies and allows you to upload files up to 300 MB via drag and drop into the web browser or up to 10 GB via the OneDrive desktop application. With OneDrive, you can download entire folders as a single ZIP file with up to 10,000 files, although it can’t exceed 15 GB per single download.

OneDrive comes with 5 GB of free storage out of the box, with an additional 100 GB, 1 TB, and 6 TB storage options available for a subscription-based fee. You can get one of these storage plans by either purchasing additional storage separately or with Office 365 subscription.

Creating a data backup:

The backup process is the same for all file types and folders. Here’s how you can back up your files using Microsoft OneDrive

Step 1: Choose the files/folders you want to backup.

Click the OneDrive icon in the taskbar

Click the OneDrive cloud icon to open the OneDrive menu. While in this menu, you can customize your file backup settings.

Select Help & Settings and click Settings

Click Help & Settings and then select Settings from the drop-down menu.

Select the Backup tab and click Manage backup

Go to the Backup tab and click Manage backup.

Select folders to backup and click Start backup

In this menu, you can choose to backup the Desktop and all of the files on it, and Documents and Pictures folders, again, with all of the files in them. Click Start backup.

Now, when you add a file or folder in the Desktop and Documents and Pictures folders, they will be automatically backed up on OneDrive.

To add folders and files, not in the locations shown above, you have to add them manually.

Select a file manually and copy it

Open File Explorer and navigate to the location of the folder/file you want to backup. Select the item, right-click it, and click Copy.

Paste the copied file in the OneDrive folder to create a backup

Then, navigate to OneDrive, right-click anywhere in the window and click Paste. Alternatively, you can just drag and drop a file into OneDrive. OneDrive will automatically create a backup of the folder/file.

File statuses in OneDrive folder

All of the files added to the OneDrive folder are backed up in the cloud automatically. The green circle with the checkmark in it indicates that the file is available both locally and on OneDrive and that the file version is the same on both. The blue cloud icon indicates that the file has not been synced and is available only on OneDrive. The sync icon indicates that the file is currently syncing.

Click Help & Settings and click View Online

To access files only located on OneDrive online, go to the Help & Settings drop-down menu and select View online.

Click the Settings cog and click Options

Step 2: Restore corrupted files.

OneDrive makes sure that the files stay in sync, so the version of the file on the computer is the same version on the cloud. However, if ransomware has encrypted your files, you can take advantage of OneDrive’s Version history feature that will allow you to restore the file versions prior to encryption.

Microsoft 365 has a ransomware detection feature that notifies you when your OneDrive files have been attacked and guide you through the process of restoring your files. It must be noted, however, that if you don’t have a paid Microsoft 365 subscription, you only get one detection and file recovery for free.

If your OneDrive files get deleted, corrupted, or infected by malware, you can restore your entire OneDrive to a previous state. Here’s how you can restore your entire OneDrive:

restore-your-onedrive

1. If you're signed in with a personal account, click the Settings cog at the top of the page. Then, click Options and select Restore your OneDrive.

If you're signed in with a work or school account,  click the Settings cog at the top of the page. Then, click Restore your OneDrive.

2. On the Restore your OneDrive page, select a date from the drop-down list. Note that if you're restoring your files after automatic ransomware detection, a restore date will be selected for you.

3. After configuring all of the file restoration options, click Restore to undo all the activities you selected.

The best way to avoid damage from ransomware infections is to maintain regular up-to-date backups.

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About the author:

Tomas Meskauskas

Tomas Meskauskas - expert security researcher, professional malware analyst.

I am passionate about computer security and technology. I have an experience of over 10 years working in various companies related to computer technical issue solving and Internet security. I have been working as an author and editor for pcrisk.com since 2010. Follow me on Twitter and LinkedIn to stay informed about the latest online security threats. Contact Tomas Meskauskas.

PCrisk security portal is brought by a company RCS LT. Joined forces of security researchers help educate computer users about the latest online security threats. More information about the company RCS LT.

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Malware activity

Global malware activity level today:

Medium threat activity

Increased attack rate of infections detected within the last 24 hours.

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