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Self-Replicating Malware Used by Chinese Cyberspies Spreads via USB Drives

A China-linked cyberespionage group tracked as UNC4191 has been observed using self-replicating malware on USB drives to infect targets, and the technique could allow them to steal data from air-gapped systems, Google-owned Mandiant reports.

A China-linked cyberespionage group tracked as UNC4191 has been observed using self-replicating malware on USB drives to infect targets, and the technique could allow them to steal data from air-gapped systems, Google-owned Mandiant reports.

UNC4191 has been observed targeting public and private entities in Southeast Asia, Asia-Pacific, Europe, and the US, with a focus on the Philippines, deploying legitimately signed binaries to side-load malware.

As part of the investigated activity, the threat actor has used malware families such as the Mistcloak launcher, the Darkdew dropper, and the Bluehaze launcher.

The attackers also deployed the NCAT command-line networking utility (for file download and upload purposes) and a reverse shell on the target machine, to achieve backdoor access to the compromised system.

“The malware self-replicates by infecting new removable drives that are plugged into a compromised system, allowing the malicious payloads to propagate to additional systems and potentially collect data from air-gapped systems,” Mandiant says.

The infection cycle starts with the user connecting an infected removable drive to their machine, which triggers the execution of a version of the USB Network Gate application, to side-load Mistcloak. This piece of malware loads an INI file containing Darkdew, which is designed to achieve persistence and infect USB drives when they are connected to the system.

Bluehaze, which is executed at the third phase of the infection chain, was designed to execute a renamed NCAT executable, which creates a reverse shell to a hardcoded command-and-control (C&C) server.

“Mandiant has not observed evidence of reverse shell interaction; however, based on the age of the activity, this may be a result of visibility gaps or short log retention periods,” Mandiant notes.

The cybersecurity firm believes that the campaign has been ongoing since at least September 2021, focused on compromising public and private entities to conduct cyberespionage operations related to China’s political and commercial interests.

“Our observations suggest that entities in the Philippines are the main target of this operation based on the number of affected systems located in this country that were identified,” Mandiant says.

Related: Analysis of Russian Cyberspy Attacks Leads to Discovery of Windows Vulnerability

Related: Hackers Possibly From China Using New Method to Deploy Persistent ESXi Backdoors

Related: Chinese Threat Actor Targets Rare Earth Mining Companies in North America, Australia

Written By

Ionut Arghire is an international correspondent for SecurityWeek.

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