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Note: I BleedingPainter, nor NextGenUpdate, take legal responsiblity what is acted upon of other individuals. This post is only for educational purposes and is NOT to be acted upon. If you do, you forfeit any affiliation with BleedingPainter or NGU.
Social Engineering, defined as;
The act of manipulating people into performing actions or divulging confidential information. While similar to a confidence trick or simple fraud, the term typically applies to trickery or deception for the purpose of information gathering, fraud, or computer system access; in most cases the attacker never comes face-to-face with the victim.
Which is exactly what you want to happen, and never want to happen. You want to obtain personal information and never be confronted with the person face-to-face.
Most common forms of social engineering is for online games such as Habbo Hotel, RuneScape, even WOW. Basically on games such as these, you become friends with the Victim, you know BFFLZLZ!!! and you share each others passwords. Easy right? Right. You screw the other person over and take there stuff, just because they trusted the wrong person.
To teach basic social engineering, you have to go back to when you were a nice person and you would have never thought to look at a post like this! You're going to be the All American Kid, if you can relate to that.. you did everything right, you're nice to everyone, and you get what you want.
Now, say you wanted to find someone's secret question to their email.. (refer to my Ancient MSN Recovery) and their question is, "Where did your mother grow up?" Betting that they forgot their question, you're in, if you're slick. A conversation would go like this..
You; Hey hows it going? (talk about some dumb shit) Oh yeah did you see that new glitch in Lumber Mills?
Victim; No way! You'll have to show me and I'm doing fine, blahblahblah.
Y: Yeah my family is from Arkansa, there are a lot of lumber mills there, that's probably how I discovered it all by myself

And you're going to be the only person that knows besides me! LOL.
V: Thanks!
Y: Where's your family from? Like your mom and dad?
V: My mom is from New York City, that's where she grew up.
Now that's if the person is totally trust worthy, loves you, and considers you like teh l33t.
Easy enough, correct? Now you can do this certain ways, even making them accept files that they know are virii, keylogs, etc.
Have fun with it, but if you are ever caught, deny and delete
Baiting; one of my personal favorites, knowing you can cheat other mean stupid people.
Step1; Get a blank disk and your virus, trojan, keylog, etc. ready. Load it on the disk.
Step2; burn it on the disk and give the disk a very curious name such as, "Beach Party 2009 with the girls" or "2009 Bank Account Info" or such.
Note; whatever you label the disk as, make sure you put files related to the name.. if you have it as bank account shit, put a few text files on it with phony info.. if it's beach party, bind the keylog to a picture so they'll open it.
Step3: Have fun and "accidentally" drop your disk some where so you'll know someone will pick it up and be a total asshole, opening it when they get home!
Step4: Wait, get info, do whatever you please with it!