Small time cyber criminals are becoming increasingly reliant on social networking sites to swindle consumers out of cash and dupe them into downloading adware and other malicious content, Microsoft (News - Alert) noted in its annual Security Intelligence Report.

Vinny Gullotto, General Manager of Microsoft's Malware Protection Center, said that "phishing" attacks that trick people into handing over user names, passwords and financial information increased by a whopping 1,200 percent in 2010.

"Social engineering tactics include fooling people with rogue security software that pose as legitimate protection products, impersonating friends to steal passwords to online gaming accounts, conducting phishing using social networking as the lure, and tricking users to download adware," Gullotto noted in a company blog post.

The report indicates that phishing attacks using social networking as a "lure" skyrocketed from 8.3 percent at the start of 2010 to 84.5 percent by the end of the year.

Microsoft also said that the popularity of social networking sites like Facebook (News - Alert) and Twitter is impacting more than just the user who is deceived into providing personal information. Friends, colleagues and family members also end up being affected by phishing attacks that use social networking sites as a platform.

Gullotto and his team found that the online gaming world is also a newfound target for cyber criminals. Phishing that targeted these portals reached a high of 16.7 percent of all phishing in June of last year.

The software giant identified a "polarization" of cyber criminal behavior, where some highly sophisticated hackers use intelligence to target high-value marks with large payoffs, while other less sophisticated criminals use social engineering tactics to rob small amounts of cash from a large group of people.

Microsoft found that the detection of adware increased by approximately 70 percent from the second to the fourth quarter of 2010, powered mostly by the introduction of two new Adware families, JS/Pornpop and Win32/ClickPotato.

Beecher Tuttle is a TMCnet contributor. He has extensive experience writing and editing for print publications and online news websites. He has specialized in a variety of industries, including health care technology, politics and education. To read more of his articles, please visit his columnist page.

Edited by Stefanie Mosca