Two individuals have been arrested in Australia and the U.S. in connection with an alleged scheme to develop and distribute a remote access trojan called Hive RAT (previously Firebird).

The U.S. Justice Department (DoJ) said the malware “gave the malware purchasers control over victim computers and enabled them to access victims’ private communications, their login credentials, and other personal information.”

A 24-year-old individual named Edmond Chakhmakhchyan (aka “Corruption”) from Van Nuys in Los Angeles, California, was taken into custody after he was caught selling a license of Hive RAT to an undercover employee of a law enforcement agency.

He has been charged with one count of conspiracy and one count of advertising a device as an interception device, each of which carries a penalty of five years in prison. Chakhmakhchyan pleaded not guilty and was ordered to stand trial on June 4, 2024.

Court documents allege a partnership between the malware’s creator and the defendant under which the latter would post advertisements for the malware on a cybercrime forum called Hack Forums, accept cryptocurrency payments from customers, and offer product support.

Hive RAT comes with capabilities to terminate programs, browse files, record keystrokes, access incoming and outgoing communications, and steal victim passwords and other credentials for bank accounts and cryptocurrency wallets from victims’ machines without their knowledge or consent.

“Chakhmakhchyan exchanged electronic messages with purchasers and explained to one buyer that the malware ‘allowed the Hive RAT user to access another person’s computer without that person knowing about the access,'” the DoJ said.

The Australian Federal Police (AFP), which announced charges of its own against a citizen for their purported involvement in the creation and sale of Hive RAT, said its investigation into the matter began in 2020.

The unnamed suspect faces 12 charges, including one count of producing data with intent to commit a computer offense, one count of controlling data with intent to commit a computer offense, and 10 counts of supplying data with intent to commit a computer offense. The maximum penalty for each of these offenses is three years imprisonment.

“Remote Access Trojans are one of the most harmful cyber threats in the online environment – once installed onto a device, a RAT can provide criminals with full access to, and control of the device,” AFP Acting Commander Cybercrime Sue Evans said.

“This could include anything from committing crimes anonymously, watching victims through camera devices, wiping hard drives, or stealing banking credentials and other sensitive information.”

Nebraska Man Indicted in Cryptojacking Scheme

The development comes as federal prosecutors in the U.S. indicted Charles O. Parks III (aka “CP3O”), 45, for operating a massive illegal cryptojacking operation, defrauding “two well-known providers of cloud computing services” out of more than $3.5 million in computing resources to mine cryptocurrency worth nearly $1 million.

The indictment charges the Parks with wire fraud, money laundering, and engaging in unlawful monetary transactions. He was arrested on April 13, 2024. The wire fraud and money laundering charges carry a maximum sentence of 20 years’ imprisonment. He also faces a 10 years’ imprisonment on the unlawful monetary transactions charges.

While the DoJ does not explicitly state what cloud providers were targeted in the fraudulent operation, it noted that the companies are based in the Washington state cities of Seattle and Redmond – the corporate headquarters for Amazon and Microsoft.

“From in or about January 2021 through August 2021, Parks created and used a variety of names, corporate affiliations and email addresses, including emails with domains from corporate entities he operated […] to register numerous accounts with the cloud providers and to gain access to massive amounts of computing processing power and storage that he did not pay for,” the DoJ said.

The illicitly obtained resources were then used to mine cryptocurrencies such as Ether (ETH), Litecoin (LTC) and Monero (XMR), which were laundered through a network of cryptocurrency exchanges, a non-fungible token (NFT) marketplace, an online payment provider, and traditional bank accounts to conceal digital transaction trail.

The ill-gotten proceeds, prosecutors said, were ultimately converted into dollars, which Parks used to make various extravagant purchases that included a Mercedes Benz luxury car, jewelry, and first-class hotel and travel expenses.

“Parks tricked the providers into approving heightened privileges and benefits, including elevated levels of cloud computing services and deferred billing accommodations, and deflected inquiries from the providers regarding questionable data usage and mounting unpaid subscription balances,” the DoJ said.

The U.S. Department of Justice (DoJ) announced the indictment of a 38-year-old Chinese national and a California resident of allegedly stealing proprietary information from Google while covertly working for two China-based tech companies.

Linwei Ding (aka Leon Ding), a former Google engineer who was arrested on March 6, 2024, “transferred sensitive Google trade secrets and other confidential information from Google’s network to his personal account while secretly affiliating himself with PRC-based companies in the AI industry,” the DoJ said.

The defendant is said to have pilfered from Google over 500 confidential files containing artificial intelligence (AI) trade secrets with the goal of passing them on to two unnamed Chinese companies looking to gain an edge in the ongoing AI race.

“While Linwei Ding was employed as a software engineer at Google, he was secretly working to enrich himself and two companies based in the People’s Republic of China,” said U.S. Attorney Ismail Ramsey.

“By stealing Google’s trade secrets about its artificial intelligence supercomputing systems, Ding gave himself and the companies that he affiliated with in the PRC an unfair competitive advantage.”

Ding, who joined Google as a software engineer in 2019, has been accused of siphoning proprietary information related to the company’s supercomputing data center infrastructure used for running AI models, the Cluster Management System (CMS) software for managing the data centers, and the AI models and applications they supported.

The theft happened from May 21, 2022, until May 2, 2023, to a personal Google Cloud account, the indictment alleged, adding Ding secretly affiliated himself with two tech companies based in China.

This included one firm in which he was offered the position of chief technology officer sometime around June 2022 and another company founded by Ding himself by no later than May 30, 2023, acting as its chief executive officer.

“Ding’s company touted the development of a software platform designed to accelerate machine learning workloads, including training large AI models,” the DoJ said.

“A document related to Ding’s startup company stated, ‘we have experience with Google’s ten-thousand-card computational power platform; we just need to replicate and upgrade it – and then further develop a computational power platform suited to China’s national conditions.'”

But in an interesting twist, Ding took steps to conceal the theft of trade secrets by purportedly copying the data from Google source files into the Apple Notes application on his company-provided MacBook and then converting the notes to PDF files before uploading them to their Google account.

Furthermore, Ding allegedly allowed another Google employee in December 2023 to use his Google-issued access badge to scan into the entrance of a Google building, giving the impression that he was working from his U.S. Google office when, in fact, he was in China. He resigned from Google on December 26, 2023.

Ding has been charged with four counts of theft of trade secrets. If convicted, he faces a maximum penalty of 10 years in prison and up to a $250,000 fine for each count.

The development comes days after the DoJ arrested and indicted David Franklin Slater, a civilian employee of the U.S. Air Force assigned to the U.S. Strategic Command (USSTRATCOM), of transmitting classified information on a foreign online dating platform between February and April 2022.

The information included National Defense Information (NDI) pertaining to military targets and Russian military capabilities relating to Russia’s invasion of Ukraine. It’s said to have been sent to a co-conspirator, who claimed to be a female living in Ukraine, via the dating website’s messaging feature.

“Slater willfully, improperly, and unlawfully transmitted NDI classified as ‘SECRET,’ which he had reason to believe could be used to the injury of the United States or to the advantage of a foreign nation, on a foreign online dating platform to a person not authorized to receive such information,” the DoJ said.

Slater, 63, faces up to 10 years in prison, three years of supervised release, and a maximum monetary penalty of $250,000 for each count of conspiracy to transmit and the transmission of NDI. No details are known about the motives or the real identity of the individual posing as a Ukrainian woman.

Feb 20, 2024NewsroomRansomware / Data Protection

The U.K. National Crime Agency (NCA) on Tuesday confirmed that it obtained LockBit’s source code as well as intelligence pertaining to its activities and their affiliates as part of a dedicated task force called Operation Cronos.

“Some of the data on LockBit’s systems belonged to victims who had paid a ransom to the threat actors, evidencing that even when a ransom is paid, it does not guarantee that data will be deleted, despite what the criminals have promised,” the agency said.

It also announced the arrest of two LockBit actors in Poland and Ukraine. Over 200 cryptocurrency accounts linked to the group have been frozen. Indictments have also been unsealed in the U.S. against two other Russian nationals who are alleged to have carried out LockBit attacks.

Artur Sungatov and Ivan Gennadievich Kondratiev (aka Bassterlord) have been accused of deploying LockBit against numerous victims throughout the U.S., including businesses nationwide in the manufacturing and other industries, as well as victims around the world in the semiconductor and other industries, per the U.S. Department of Justice (DoJ).

Kondratyev has also been charged with three criminal counts arising from his use of the Sodinokibi, also known as REvil, ransomware variant to encrypt data, exfiltrate victim information, and extort a ransom payment from a corporate victim based in Alameda County, California.

The development comes in the aftermath of an international disruption campaign targeting LockBit, which the NCA described as the “world’s most harmful cyber crime group.”

As part of the takedown efforts, the agency said it took control of LockBit’s services and infiltrated its entire criminal enterprise. This includes the administration environment used by affiliates and the public-facing leak site hosted on the dark web.

In addition, 34 servers belonging to LockBit affiliates have also been dismantled and more than 1,000 decryption keys have been retrieved from the confiscated LockBit servers.

LockBit, since its debut in late 2019, runs a ransomware-as-a-service (RaaS) scheme in which the encryptors are licensed to affiliates, who carry out the attacks in exchange for a cut of the ransom proceeds.

The attacks follow a tactic called double extortion to steal sensitive data prior to encrypting them, with the threat actors applying pressure on victims to make a payment in order to decrypt their files and prevent their data from being published.

“The ransomware group is also infamous for experimenting with new methods for pressuring their victims into paying ransoms,” Europol said.

“Triple extortion is one such method which includes the traditional methods of encrypting the victim’s data and threatening to leak it, but also incorporates distributed denial-of-service (DDoS) attacks as an additional layer of pressure.”

The data theft is facilitated by means of a custom data exfiltration tool codenamed StealBit. The infrastructure, which was used to organize and transfer victim data, has since been seized by authorities from three countries, counting the U.S.

According to Eurojust and DoJ, LockBit attacks are believed to have affected over 2,500 victims all over the world and netted more than $120 million in illicit profits. A decryption tool has also been made available via No More Ransom to recover files encrypted by the ransomware at no cost.

“Through our close collaboration, we have hacked the hackers; taken control of their infrastructure, seized their source code, and obtained keys that will help victims decrypt their systems,” NCA Director General Graeme Biggar said.

“As of today, LockBit are locked out. We have damaged the capability and most notably, the credibility of a group that depended on secrecy and anonymity. LockBit may seek to rebuild their criminal enterprise. However, we know who they are, and how they operate.”

Jan 13, 2024NewsroomCryptojacking / Cloud Security

A 29-year-old Ukrainian national has been arrested in connection with running a “sophisticated cryptojacking scheme,” netting them over $2 million (€1.8 million) in illicit profits.

The person was apprehended in Mykolaiv, Ukraine, on January 9 by the National Police of Ukraine with support from Europol and an unnamed cloud service provider following “months of intensive collaboration.”

“A cloud provider approached Europol back in January 2023 with information regarding compromised cloud user accounts of theirs,” Europol said, adding it shared the intelligence with the Ukrainian authorities.

As part of the probe, three properties were searched to unearth evidence against the suspect.

Cryptojacking refers to a type of cyber crime that entails the unauthorized use of a person’s or organization’s computing resources to mine cryptocurrencies.

On the cloud, such attacks are typically carried out by infiltrating the infrastructure via compromised credentials obtained through other means and installing miners that use the infected host’s processing power to mine crypto without their knowledge or consent.

“If the credentials do not have the threat actors’ desired permissions, privilege escalation techniques are used to obtain additional permissions,” Microsoft noted in July 2023. “In some cases, threat actors hijack existing subscriptions to further obfuscate their operations.”

The core idea is to avoid paying for necessary infrastructure required to mine cryptocurrencies, either by taking advantage of free trials or compromising legitimate tenants to conduct cryptojacking attacks.

In October 2023, Palo Alto Networks Unit 42 detailed a cryptojacking campaign in which threat actors were found stealing Amazon Web Services (AWS) credentials from GitHub repositories within five minutes of their public disclosure to mine Monero.

Dec 20, 2023NewsroomFinancial Crime / Cyber Threat

A six-month-long international police operation codenamed HAECHI-IV has resulted in the arrests of nearly 3,500 individuals and seizures worth $300 million across 34 countries.

The exercise, which took place from July through December 2023, took aim at various types of financial crimes such as voice phishing, romance scams, online sextortion, investment fraud, money laundering associated with illegal online gambling, business email compromise fraud, and e-commerce fraud.

In addition, authorities froze associated bank and virtual asset service provider (VASP) accounts in an effort to shut off access to criminal proceeds. In total, authorities blocked 82,112 suspicious bank accounts, confiscating $199 million in hard currency and $101 million in virtual assets.

“Cooperation between Filipino and Korean authorities led to the arrest in Manila of a high-profile online gambling criminal after a two-year manhunt by Korea’s National Police Agency,” Interpol, an international police organization, said.

Investment fraud, business email compromise, and e-commerce fraud accounted for 75% of the cases, the agency added, stating it detected a new scam in South Korea that involved the sale of non-fungible tokens (NFTs) with promises of huge returns, only for the operators to stage a rug pull and abruptly abandon the project.

Another novel trend concerned the use of artificial intelligence (AI) and deepfake technology to elevate the authenticity of scams, enabling criminals to impersonate people known to the targets, as well as deceive, defraud, harass, and extort victims through impersonation scams, online sexual blackmail, and investment fraud.

HAECHI-IV comes more than a year after HAECHI-III, which led to the seizure of $130 million worth of virtual assets in connection with a global crackdown on cyber-enabled financial crimes and money laundering.

“The seizure of $300 million represents a staggering sum and clearly illustrates the incentive behind today’s explosive growth of transnational organized crime,” Interpol’s Stephen Kavanagh said. “This vast accumulation of unlawful wealth is a serious threat to global security and weakens the economic stability of nations worldwide.”