North Korea Ramps Up 'Operation GhostSecret' Cyber Espionage Campaign

On the eve of a historic summit with its rival neighbor South Korea and possible subsequent talks with the US President Donald Trump in the coming weeks, North Korea continues full-steam ahead in its mission to gather intelligence and generate income for the regime via its notorious nation-state hacking machine.

North Korea's pervasive Lazarus Group, aka Hidden Cobra, was recently discovered ramping up a global cyber espionage campaign dubbed Operation GhostSecret, stealing information from organizations in the critical infrastructure, entertainment, finance, healthcare, and telecommunications sectors. Researchers from McAfee unearthed the wave of attacks, which they say first started with targeted hacks of banks in Turkey last month.

At the time, Ryan Sherstobitoff, McAfee's senior analyst of major campaigns, told Dark Reading he believed the Turkish bank targets were part of an ongoing campaign. The goal could be to "surveil their operations, establish functions of their processes, and ultimately compromise funds," he said.

Days after McAfee published those findings on the attacks on the Turkish financial industry via the so-called Bankshot Trojan implant, the researchers spotted the same spying malware in organizations in 17 countries. McAfee is working with the government in Thailand – where most of the attacks have occurred to date — to shut down Operation GhostSecret's control-server infrastructure.

Operation GhostSecret employs multiple custom malware implants to pilfer information from its targets, and attempts to evade detection, including a new variant that looks a lot like Destover, the malware Lazarus Group used in its massive hack of Sony Pictures in 2014. In addition, researchers discovered a new malware family called Proxysvc, which they believe was used with the 2017 Destover variant, which is supported by a server infrastructure with IP addresses in India.

"Proxysvc was first collected by public and private sources on March 22 from an unknown entity in the United States. The executable dropper for the component was submitted from South Korea on March 19," according to McAfee's research report. "Our research shows this listener component appeared mostly in higher education organizations. We suspect this component is involved in core control server infrastructure. These targets were chosen intentionally to run Proxysvc because the attacker would have needed to know which systems were infected to connect to them."

"As we monitor this campaign, it is clear that the publicity associated with the (we assume) first phase of this campaign did nothing to slow the attacks. The threat actors not only continued but also increased the scope of the attack, both in types of targets and in the tools they used," Raj Samani, chief scientist at McAfee, said in a blog post.

Working — and Hacking — Abroad

Thailand has become one of the newest nations known for North Korean citizens to locate and generate income on behalf of the Pyongyang regime, according to Recorded Future, which along with Insikt Group this week published a new analysis report on North Korean activity online. Other locations include Bangladesh, along with India, Malaysia, China, New Zealand, Nepal, Kenya, Mozambique, and Indonesia.

North Koreans sent to Thailand, Bangladesh, China, and other nations, attend universities there and study computer science, for example. There they develop phony video games and bots that scam users out of valuable digital items that they then resell, and then they find and sell bugs in gaming software.

"Thailand and Bangladesh host North Korean state-run restaurants, diplomatic establishments tied to criminal activity, and allow North Korean investment," Recorded Future's report said.

Lazarus Group and other North Korean cyberattack groups are all about generating income for the nation, whether it's cryptocurrency mining, online gaming scams, or bank heists. "The regime needs funds, and they will continue to pursue" attacks that make money, says Levi Gundert, vice president of intelligence and risk at Recorded Future.

But North Korea's pure intelligence-gathering capabilities are still not at the level of other more cyber espionage-experienced nations, Gundert says. "They're not a China," he says. "They have tools and can develop their own toolsets … [and have] experience in offensive campaigns, but it's not as broad as China or Russia."

Meanwhile, North Korea's ruling elite – most of whom are associated with the Kim family and regime and make up about .1% of the nation's population and the only citizens allowed to access the global Internet — in the past six months have gone all obfuscation in their online activities, according to Recorded Future's findings. They've mostly abandoned popular western social media and online services such as Google, Facebook, and Instagram, in favor of corresponding Chinese services Alibaba, Tencent, and Baidu, in an apparent attempt to hide from US researchers and intelligence agencies.

Most of their online activity includes video viewing and online gaming (70%), as well as Web browsing (13%). They've also increased their use of VPNs and the Tor anonymization browser by 1,200%, and have begun mining the more anonymous Monero digital currency, in addition to mining Bitcoin. Overall, 13% of North Korean leadership was using obfuscation methods online, up from less than 1% in July of 2017.

Priscilla Moriuchi, director of strategic threat development at Recorded Future, says she was surprised by the sudden shift in online behavior by the North Korean elites. "What this tells us is how adaptable" the North Korean leadership is, she says. "We often think of authoritarian regimes as static. But time after time … they've adapted quickly to new technologies, using and exploiting them and innovating new methods to circumvent sanctions."

The consequence of the North Korean ruling elite basically going dark on the public Internet is less insight into their behaviors, interests, and other social intel, according to Moriuchi.

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