A computer contractor has been convicted of planting a logic bomb on the servers of Fannie Mae, the financially troubled US housing and mortgage giant.

Rajendrasinh Babubhai Makwana, 36, responded to the termination of his two-year-long spell as a software development contractor at Fannie Mae in October 2008 by planting a malicious script designed to wipe all the data from its network on 31 January 2009. Anyone attempting to access data on the system after the logic bomb went off would have received the message "Server Graveyard".

Fortunately, Fannie Mae sysadmins found the malware days after Makwana left work at the Urbana, Maryland technology centre and weeks before the logic bomb was due to explode. Subsequent forensic analysis of computer logs traced the attempted attack back to Makwana's workplace laptop, which yielded more evidence. Because of his job developing software for Unix boxes, Makwana reportedly had access to the full range of Fannie Mae's 5,000 servers.

Even though Fannie Mae undoubtedly had back-up, the attempted attack would have been enormously disruptive and extremely costly - even if it was only partially successful deleting securities and mortgage data. Company representatives testified that it might take as long as a week to fully restore systems using off-site backups if the failed attack had been entirely successful in its malicious aims.

Makwana, who was convicted of computer sabotage and hacking offences punishable by a maximum of 10 years imprisonment by a jury, faces a sentencing hearing on 8 December.

An FBI statement on the case can be found here. Commentary on the practical implications of the attempted attack, and the lessons that might be drawn about the risk from disaffected workers, can be found in a blog post by Sophos here.

Fannie Mae (The Federal National Mortgage Association) and the smaller Freddie Mac (The Federal Home Loan Mortgage Corporation) either control or guarantee almost half of all home loans in the US. Shares in Fannie Mae plummeted as a result of the US sub-prime housing crisis but its operations continued thanks to access to low-interest loans and supportive statements from the federal government that its business was vital to the US housing market. ®