DOJ Indicts 12 Chinese Nationals for Decade-Long Cyber Espionage Campaign

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In a landmark move that underscores the growing threat of cyber espionage, the U.S. Department of Justice (DOJ) has unsealed indictments against 12 Chinese nationals involved in an extensive decade-long cyber espionage campaign. The accused individuals are implicated in state-sponsored operations targeting critical sectors such as the U.S. Treasury Department, religious organizations, media outlets, and key infrastructure. This sophisticated operation saw the deployment of advanced malware, including PlugX and HyperBro, and leveraged vulnerabilities such as CVE-2017-0213 to penetrate robust security defenses. Collaboration with Chinese security agencies formed a cornerstone of this campaign, aiming not only to suppress dissent but also to exfiltrate valuable sensitive data.

Accused and Their Allegiances

Among the indicted individuals are officers from China’s Ministry of Public Security (MPS), employees of the Chengdu-based i-Soon Information Technology, and members of the notorious Advanced Persistent Threat group APT27, also known by monikers like Silk Typhoon or Emissary Panda. This group’s activities trace back to 2010, focusing primarily on sectors such as defense, aerospace, and government operations, using a range of sophisticated, custom-developed tools to achieve their objectives. Court documents reveal i-Soon Information Technology’s role as a “hacker-for-hire” operation, providing its services to MPS and the Ministry of State Security (MSS) at prices ranging from $10,000 to $75,000 per compromised email inbox. Their tactics included DLL side-loading, using legitimate executables like Google Updater to distribute malware, and employing tools such as Mimikatz for credential harvesting, together with exploiting vulnerabilities like CVE-2017-0213 for privilege escalation.

APT27’s modus operandi involved multi-stage intrusion chains, employing ASPXSpy web shells to achieve lateral movement within compromised networks and using BitLocker encryption to lock victims out of their systems. Notably, APT27 exploited ProxyShell vulnerabilities in Microsoft Exchange servers to deploy HyperBro, facilitating remote command execution. Some of the most significant breaches involved the U.S. Treasury Department and various foreign ministries, as well as a U.S.-based religious organization critical of China’s policies. These operations have reportedly inflicted millions of dollars in damages, including through ransomware deployments and intellectual property theft from defense contractors and academic institutions.

Countermeasures and Enforcement

In light of these extensive breaches, the FBI collaborated with Microsoft’s Threat Intelligence Center to disrupt the operations of i-Soon Information Technology and APT27 by seizing their primary domains and VPS infrastructures used for command and control purposes. Moreover, the U.S. State Department has announced monetary rewards amounting to $12 million for information leading to the capture of i-Soon operatives and key APT27 members, namely Zhou Shuai and Yin Kecheng. Adding to this multi-pronged approach, the Treasury’s Office of Foreign Assets Control (OFAC) has sanctioned Shanghai Heiying Information Technology, identified as a front for Zhou Shuai, and subsequently blocked assets tied to these malicious cyber operations.

Sue J. Bai, the head of the DOJ’s National Security Division, has reiterated the DOJ’s steadfast commitment to tackling cyber threats. This vow is exemplified by their proactive stance in exposing Chinese government agents and their affiliated hackers involved in these unauthorized activities. Despite the Chinese Embassy dismissing the allegations as baseless, leaked marketing materials from i-Soon Information Technology revealed contracts with over 43 different Chinese security bureaus. This revelation underscores the blurred lines between state actors and civilian hackers in the realm of cyber espionage.

Implications and Future Considerations

The DOJ’s action against these cybercriminals underscores the ongoing battle against cyber threats and the need for robust cybersecurity measures to protect national interests and sensitive information.

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