SofiaITC Mission Critical Solutions APT40: Examining a China-Nexus Espionage Actor | SofiaITC

APT40: Examining a China-Nexus Espionage Actor

FireEye is highlighting a cyber espionage operation targeting crucial
technologies and traditional intelligence targets from a China-nexus
state sponsored actor we call APT40. The actor has conducted
operations since at least 2013 in support of China’s naval
modernization effort. The group has specifically targeted engineering,
transportation, and the defense industry, especially where these
sectors overlap with maritime technologies. More recently, we have
also observed specific targeting of countries strategically important
to the Belt and Road Initiative including Cambodia, Belgium, Germany,
Hong Kong, Philippines, Malaysia, Norway, Saudi Arabia, Switzerland,
the United States, and the United Kingdom. This China-nexus cyber
espionage group was previously reported as TEMP.Periscope and TEMP.Jumper.

Mission

In December 2016, China’s People Liberation Army Navy (PLAN) seized
a U.S. Navy unmanned underwater vehicle (UUV) operating in the South
China Sea. The incident paralleled China’s actions in cyberspace;
within a year APT40 was observed masquerading as a UUV manufacturer,
and targeting universities engaged in naval research. That incident
was one of many carried out to acquire advanced technology to support
the development of Chinese naval capabilities. We believe APT40’s
emphasis on maritime issues and naval technology ultimately support
China’s ambition to establish a blue-water navy.

In addition to its maritime focus, APT40 engages in broader regional
targeting against traditional intelligence targets, especially
organizations with operations in Southeast Asia or involved in South
China Sea disputes. Most recently, this has included victims
with connections to elections
in Southeast Asia, which is likely
driven by events affecting China’s Belt and Road Initiative. China’s
“One Belt, One Road” (一带一路) or “Belt and Road Initiative” (BRI) is a
$1 trillion USD endeavor to build land and maritime trade routes
across Asia, Europe, the Middle East, and Africa to develop a trade
network that will project China’s influence across the greater region.


Figure 1: Countries and industries
targeted. Countries include the United States, United Kingdom,
Norway, Germany, Saudi Arabia, Cambodia and Indonesia

Attribution

We assess with moderate confidence that APT40 is a state-sponsored
Chinese cyber espionage operation. The actor’s targeting is consistent
with Chinese state interests and there are multiple technical
artifacts indicating the actor is based in China. Analysis of the
operational times of the group’s activities indicates that it is
probably centered around China Standard Time (UTC +8). In addition,
multiple APT40 command and control (C2) domains were initially
registered by China based domain resellers and had Whois records with
Chinese location information, suggesting a China based infrastructure
procurement process.

APT40 has also used multiple Internet Protocol (IP) addresses
located in China to conduct its operations. In one instance, a log
file recovered from an open indexed server (link to previous blog)
revealed that an IP address (112.66.188.28) located in Hainan, China
had been used to administer the command and control node that was
communicating with malware on victim machines. All of the logins to
this C2 were from computers configured with Chinese language settings.

Attack Lifecycle

Initial Compromise

APT40 has been observed leveraging a variety of techniques for
initial compromise, including web server exploitation, phishing
campaigns delivering publicly available and custom backdoors, and
strategic web compromises.

  • APT40 relies heavily on
    web shells for an initial foothold into an organization. Depending
    on placement, a web shell can provide continued access to victims’
    environments, re-infect victim systems, and facilitate lateral
    movement.
  • The operation’s spear-phishing emails typically
    leverage malicious attachments, although Google Drive links have
    also been observed.
  • APT40 leverages exploits in their
    phishing operations, often weaponizing vulnerabilities within days
    of their disclosure. Observed vulnerabilities include:


Figure 2: APT40 attack lifecycle

Establish Foothold

APT40 uses a variety of malware and tools to establish a foothold,
many of which are either publicly available or used by other threat
groups. In some cases, the group has used executables with code
signing certificates to avoid detection.

  • First-stage backdoors
    such as AIRBREAK, FRESHAIR, and BEACON are used before downloading
    other payloads.
  • PHOTO, BADFLICK, and CHINA CHOPPER are
    among the most frequently observed backdoors used by APT40.
  • APT40 will often target VPN and remote desktop credentials to
    establish a foothold in a targeted environment. This methodology
    proves to be ideal as once these credentials are obtained, they may
    not need to rely as heavily on malware to continue the mission.

Escalate Privileges

APT40 uses a mix of custom and publicly available credential
harvesting tools to escalate privileges and dump password hashes.

  • APT40 leverages custom
    credential theft utilities such as HOMEFRY, a password
    dumper/cracker used alongside the AIRBREAK and BADFLICK
    backdoors.
  • Additionally, the Windows Sysinternals ProcDump
    utility and Windows Credential Editor (WCE) are believed to be used
    during intrusions as well.

Internal Reconnaissance

APT40 uses compromised credentials to log on to other connected
systems and conduct reconnaissance. The group also leverages RDP, SSH,
legitimate software within the victim environment, an array of native
Windows capabilities, publicly available tools, as well as custom
scripts to facilitate internal reconnaissance.

  • APT40 used MURKYSHELL at
    a compromised victim organization to port scan IP addresses and
    conduct network enumeration.
  • APT40 frequently uses native
    Windows commands, such as net.exe, to conduct internal
    reconnaissance of a victim’s environment.
  • Web shells are
    heavily relied on for nearly all stages of the attack lifecycle.
    Internal web servers are often not configured with the same security
    controls as public-facing counterparts, making them more vulnerable
    to exploitation by APT40 and similarly sophisticated groups.

Lateral Movement

APT40 uses many methods for lateral movement throughout an
environment, including custom scripts, web shells, a variety of
tunnelers, as well as Remote Desktop Protocol (RDP). For each new
system compromised, the group usually executes malware, performs
additional reconnaissance, and steals data.

  • APT40 also uses native
    Windows utilities such as at.exe (a task scheduler) and net.exe (a
    network resources management tool) for lateral movement.
  • Publicly available tunneling tools are leveraged alongside
    distinct malware unique to the operation.
  • Although MURKYTOP
    is primarily a command-line reconnaissance tool, it can also be used
    for lateral movement.
  • APT40 also uses publicly available
    brute-forcing tools and a custom utility called DISHCLOTH to attack
    different protocols and services.

Maintain Presence

APT40 primarily uses backdoors, including web shells, to maintain
presence within a victim environment. These tools enable continued
control of key systems in the targeted network.

  • APT40 strongly favors web
    shells for maintaining presence, especially publicly available
    tools.
  • Tools used during the Establish Foothold phase also
    continue to be used in the Maintain Presence phase; this includes
    AIRBREAK and PHOTO.
  • Some APT40 malware tools can evade
    typical network detectiona by leveraging legitimate websites, such
    as GitHub, Google, and Pastebin for initial C2 communications.
  • Common TCP ports 80 and 443 are used to blend in with routine
    network traffic.

Complete Mission

Completing missions typically involves gathering and transferring
information out of the target network, which may involve moving files
through multiple systems before reaching the destination. APT40 has
been observed consolidating files acquired from victim networks and
using the archival tool rar.exe to compress and encrypt the data
before exfiltration. We have also observed APT40 develop tools such as
PAPERPUSH to aid in the effectiveness of their data targeting and theft.

Outlook and Implications

Despite increased public attention, APT40 continues to conduct cyber
espionage operations following a regular tempo, and we anticipate
their operations will continue through at least the near and medium
term. Based on APT40’s broadening into election-related targets in
2017, we assess with moderate confidence that the group’s future
targeting will affect additional sectors beyond maritime, driven by
events such as China’s Belt and Road Initiative. In particular, as
individual Belt and Road projects unfold, we are likely to see
continued activity by APT40 which extends against the project’s
regional opponents.