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April 24, 2024

How Cactus Ransomware Was Detected and Stopped

Discover the tactics used to uncover a Cactus ransomware infection and the implications for cybersecurity defenses.
Inside the SOC
Darktrace cyber analysts are world-class experts in threat intelligence, threat hunting and incident response, and provide 24/7 SOC support to thousands of Darktrace customers around the globe. Inside the SOC is exclusively authored by these experts, providing analysis of cyber incidents and threat trends, based on real-world experience in the field.
Written by
Tiana Kelly
Deputy Team Lead, London & Cyber Analyst
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24
Apr 2024

What is CACTUS Ransomware?

In May 2023, Kroll Cyber Threat Intelligence Analysts identified CACTUS as a new ransomware strain that had been actively targeting large commercial organizations since March 2023 [1]. CACTUS ransomware gets its name from the filename of the ransom note, “cAcTuS.readme.txt”. Encrypted files are appended with the extension “.cts”, followed by a number which varies between attacks, e.g. “.cts1” and “.cts2”.

As the cyber threat landscape adapts to ever-present fast-paced technological change, ransomware affiliates are employing progressively sophisticated techniques to enter networks, evade detection and achieve their nefarious goals.

How does CACTUS Ransomware work?

In the case of CACTUS, threat actors have been seen gaining initial network access by exploiting Virtual Private Network (VPN) services. Once inside the network, they may conduct internal scanning using tools like SoftPerfect Network Scanner, and PowerShell commands to enumerate endpoints, identify user accounts, and ping remote endpoints. Persistence is maintained by the deployment of various remote access methods, including legitimate remote access tools like Splashtop, AnyDesk, and SuperOps RMM in order to evade detection, along with malicious tools like Cobalt Strike and Chisel. Such tools, as well as custom scripts like TotalExec, have been used to disable security software to distribute the ransomware binary. CACTUS ransomware is unique in that it adopts a double-extortion tactic, stealing data from target networks and then encrypting it on compromised systems [2].

At the end of November 2023, cybersecurity firm Arctic Wolf reported instances of CACTUS attacks exploiting vulnerabilities on the Windows version of the business analytics platform Qlik, specifically CVE-2023-41266, CVE-2023-41265, and CVE-2023-48365, to gain initial access to target networks [3]. The vulnerability tracked as CVE-2023-41266 can be exploited to generate anonymous sessions and perform HTTP requests to unauthorized endpoints, whilst CVE-2023-41265 does not require authentication and can be leveraged to elevate privileges and execute HTTP requests on the backend server that hosts the application [2].

Darktrace’s Coverage of CACTUS Ransomware

In November 2023, Darktrace observed malicious actors leveraging the aforementioned method of exploiting Qlik to gain access to the network of a customer in the US, more than a week before the vulnerability was reported by external researchers.

Here, Qlik vulnerabilities were successfully exploited, and a malicious executable (.exe) was detonated on the network, which was followed by network scanning and failed Kerberos login attempts. The attack culminated in the encryption of numerous files with extensions such as “.cts1”, and SMB writes of the ransom note “cAcTuS.readme.txt” to multiple internal devices, all of which was promptly identified by Darktrace DETECT™.

While traditional rules and signature-based detection tools may struggle to identify the malicious use of a legitimate business platform like Qlik, Darktrace’s Self-Learning AI was able to confidently identify anomalous use of the tool in a CACTUS ransomware attack by examining the rarity of the offending device’s surrounding activity and comparing it to the learned behavior of the device and its peers.

Unfortunately for the customer in this case, Darktrace RESPOND™ was not enabled in autonomous response mode during their encounter with CACTUS ransomware meaning that attackers were able to successfully escalate their attack to the point of ransomware detonation and file encryption. Had RESPOND been configured to autonomously act on any unusual activity, Darktrace could have prevented the attack from progressing, stopping the download of any harmful files, or the encryption of legitimate ones.

Cactus Ransomware Attack Overview

Holiday periods have increasingly become one of the favoured times for malicious actors to launch their attacks, as they can take advantage of the festive downtime of organizations and their security teams, and the typically more relaxed mindset of employees during this period [4].

Following this trend, in late November 2023, Darktrace began detecting anomalous connections on the network of a customer in the US, which presented multiple indicators of compromise (IoCs) and tactics, techniques and procedures (TTPs) associated with CACTUS ransomware. The threat actors in this case set their attack in motion by exploiting the Qlik vulnerabilities on one of the customer’s critical servers.

Darktrace observed the server device making beaconing connections to the endpoint “zohoservice[.]net” (IP address: 45.61.147.176) over the course of three days. This endpoint is known to host a malicious payload, namely a .zip file containing the command line connection tool PuttyLink [5].

Darktrace’s Cyber AI Analyst was able to autonomously identify over 1,000 beaconing connections taking place on the customer’s network and group them together, in this case joining the dots in an ongoing ransomware attack. AI Analyst recognized that these repeated connections to highly suspicious locations were indicative of malicious command-and-control (C2) activity.

Cyber AI Analyst Incident Log showing the offending device making over 1,000 connections to the suspicious hostname “zohoservice[.]net” over port 8383, within a specific period.
Figure 1: Cyber AI Analyst Incident Log showing the offending device making over 1,000 connections to the suspicious hostname “zohoservice[.]net” over port 8383, within a specific period.

The infected device was then observed downloading the file “putty.zip” over a HTTP connection using a PowerShell user agent. Despite being labelled as a .zip file, Darktrace’s detection capabilities were able to identify this as a masqueraded PuttyLink executable file. This activity resulted in multiple Darktrace DETECT models being triggered. These models are designed to look for suspicious file downloads from endpoints not usually visited by devices on the network, and files whose types are masqueraded, as well as the anomalous use of PowerShell. This behavior resembled previously observed activity with regards to the exploitation of Qlik Sense as an intrusion technique prior to the deployment of CACTUS ransomware [5].

The downloaded file’s URI highlighting that the file type (.exe) does not match the file's extension (.zip). Information about the observed PowerShell user agent is also featured.
Figure 2: The downloaded file’s URI highlighting that the file type (.exe) does not match the file's extension (.zip). Information about the observed PowerShell user agent is also featured.

Following the download of the masqueraded file, Darktrace observed the initial infected device engaging in unusual network scanning activity over the SMB, RDP and LDAP protocols. During this activity, the credential, “service_qlik” was observed, further indicating that Qlik was exploited by threat actors attempting to evade detection. Connections to other internal devices were made as part of this scanning activity as the attackers attempted to move laterally across the network.

Numerous failed connections from the affected server to multiple other internal devices over port 445, indicating SMB scanning activity.
Figure 3: Numerous failed connections from the affected server to multiple other internal devices over port 445, indicating SMB scanning activity.

The compromised server was then seen initiating multiple sessions over the RDP protocol to another device on the customer’s network, namely an internal DNS server. External researchers had previously observed this technique in CACTUS ransomware attacks where an RDP tunnel was established via Plink [5].

A few days later, on November 24, Darktrace identified over 20,000 failed Kerberos authentication attempts for the username “service_qlik” being made to the internal DNS server, clearly representing a brute-force login attack. There is currently a lack of open-source intelligence (OSINT) material definitively listing Kerberos login failures as part of a CACTUS ransomware attack that exploits the Qlik vulnerabilities. This highlights Darktrace’s ability to identify ongoing threats amongst unusual network activity without relying on existing threat intelligence, emphasizing its advantage over traditional security detection tools.

Kerberos login failures being carried out by the initial infected device. The destination device detected was an internal DNS server.
Figure 4: Kerberos login failures being carried out by the initial infected device. The destination device detected was an internal DNS server.

In the month following these failed Kerberos login attempts, between November 26 and December 22, Darktrace observed multiple internal devices encrypting files within the customer’s environment with the extensions “.cts1” and “.cts7”. Devices were also seen writing ransom notes with the file name “cAcTuS.readme.txt” to two additional internal devices, as well as files likely associated with Qlik, such as “QlikSense.pdf”. This activity detected by Darktrace confirmed the presence of a CACTUS ransomware infection that was spreading across the customer’s network.

The model, 'Ransom or Offensive Words Written to SMB', triggered in response to SMB file writes of the ransom note, ‘cAcTuS.readme.txt’, that was observed on the customer’s network.
Figure 5: The model, 'Ransom or Offensive Words Written to SMB', triggered in response to SMB file writes of the ransom note, ‘cAcTuS.readme.txt’, that was observed on the customer’s network.
CACTUS ransomware extensions, “.cts1” and “.cts7”, being appended to files on the customer’s network.
Figure 6: CACTUS ransomware extensions, “.cts1” and “.cts7”, being appended to files on the customer’s network.

Following this initial encryption activity, two affected devices were observed attempting to remove evidence of this activity by deleting the encrypted files.

Attackers attempting to remove evidence of their activity by deleting files with appendage “.cts1”.
Figure 7: Attackers attempting to remove evidence of their activity by deleting files with appendage “.cts1”.

Conclusion

In the face of this CACTUS ransomware attack, Darktrace’s anomaly-based approach to threat detection enabled it to quickly identify multiple stages of the cyber kill chain occurring in the customer’s environment. These stages ranged from ‘initial access’ by exploiting Qlik vulnerabilities, which Darktrace was able to detect before the method had been reported by external researchers, to ‘actions on objectives’ by encrypting files. Darktrace’s Self-Learning AI was also able to detect a previously unreported stage of the attack: multiple Kerberos brute force login attempts.

If Darktrace’s autonomous response capability, RESPOND, had been active and enabled in autonomous response mode at the time of this attack, it would have been able to take swift mitigative action to shut down such suspicious activity as soon as it was identified by DETECT, effectively containing the ransomware attack at the earliest possible stage.

Learning a network’s ‘normal’ to identify deviations from established patterns of behaviour enables Darktrace’s identify a potential compromise, even one that uses common and often legitimately used administrative tools. This allows Darktrace to stay one step ahead of the increasingly sophisticated TTPs used by ransomware actors.

Credit to Tiana Kelly, Cyber Analyst & Analyst Team Lead, Anna Gilbertson, Cyber Analyst

Appendices

References

[1] https://www.kroll.com/en/insights/publications/cyber/cactus-ransomware-prickly-new-variant-evades-detection

[2] https://www.bleepingcomputer.com/news/security/cactus-ransomware-exploiting-qlik-sense-flaws-to-breach-networks/

[3] https://explore.avertium.com/resource/new-ransomware-strains-cactus-and-3am

[4] https://www.soitron.com/cyber-attackers-abuse-holidays/

[5] https://arcticwolf.com/resources/blog/qlik-sense-exploited-in-cactus-ransomware-campaign/

Darktrace DETECT Models

Compromise / Agent Beacon (Long Period)

Anomalous Connection / PowerShell to Rare External

Device / New PowerShell User Agent

Device / Suspicious SMB Scanning Activity

Anomalous File / EXE from Rare External Location

Anomalous Connection / Unusual Internal Remote Desktop

User / Kerberos Password Brute Force

Compromise / Ransomware / Ransom or Offensive Words Written to SMB

Unusual Activity / Anomalous SMB Delete Volume

Anomalous Connection / Multiple Connections to New External TCP Port

Compromise / Slow Beaconing Activity To External Rare  

Compromise / SSL Beaconing to Rare Destination  

Anomalous Server Activity / Rare External from Server  

Compliance / Remote Management Tool On Server

Compromise / Agent Beacon (Long Period)  

Compromise / Suspicious File and C2  

Device / Internet Facing Device with High Priority Alert  

Device / Large Number of Model Breaches  

Anomalous File / Masqueraded File Transfer

Anomalous File / Internet facing System File Download  

Anomalous Server Activity / Outgoing from Server

Device / Initial Breach Chain Compromise  

Compromise / Agent Beacon (Medium Period)  

Compromise / Agent Beacon (Long Period)  

List of IoCs

IoC - Type - Description

zohoservice[.]net: 45.61.147[.]176 - Domain name: IP Address - Hosting payload over HTTP

Mozilla/5.0 (Windows NT; Windows NT 10.0; en-US) WindowsPowerShell/5.1.17763.2183 - User agent -PowerShell user agent

.cts1 - File extension - Malicious appendage

.cts7- File extension - Malicious appendage

cAcTuS.readme.txt - Filename -Ransom note

putty.zip – Filename - Initial payload: ZIP containing PuTTY Link

MITRE ATT&CK Mapping

Tactic - Technique  - SubTechnique

Web Protocols: COMMAND AND CONTROL - T1071 -T1071.001

Powershell: EXECUTION - T1059 - T1059.001

Exploitation of Remote Services: LATERAL MOVEMENT - T1210 – N/A

Vulnerability Scanning: RECONAISSANCE     - T1595 - T1595.002

Network Service Scanning: DISCOVERY - T1046 - N/A

Malware: RESOURCE DEVELOPMENT - T1588 - T1588.001

Drive-by Compromise: INITIAL ACCESS - T1189 - N/A

Remote Desktop Protocol: LATERAL MOVEMENT – 1021 -T1021.001

Brute Force: CREDENTIAL ACCESS        T – 1110 - N/A

Data Encrypted for Impact: IMPACT - T1486 - N/A

Data Destruction: IMPACT - T1485 - N/A

File Deletion: DEFENSE EVASION - T1070 - T1070.004

Inside the SOC
Darktrace cyber analysts are world-class experts in threat intelligence, threat hunting and incident response, and provide 24/7 SOC support to thousands of Darktrace customers around the globe. Inside the SOC is exclusively authored by these experts, providing analysis of cyber incidents and threat trends, based on real-world experience in the field.
Written by
Tiana Kelly
Deputy Team Lead, London & Cyber Analyst

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May 2, 2025

SocGholish: From loader and C2 activity to RansomHub deployment

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Over the past year, a clear pattern has emerged across the threat landscape: ransomware operations are increasingly relying on compartmentalized affiliate models. In these models, initial access brokers (IABs) [6], malware loaders, and post-exploitation operators work together.

Due to those specialization roles, a new generation of loader campaigns has risen. Threat actors increasingly employ loader operators to quietly establish footholds on the target network. These entities then hand off access to ransomware affiliates. One loader that continues to feature prominently in such campaigns is SocGholish.

What is SocGholish?

SocGholish is a loader malware that has been utilized since at least 2017 [7].  It has long been associated with fake browser updates and JavaScript-based delivery methods on infected websites.

Threat actors often target outdated or poorly secured CMS-based websites like WordPress. Through unpatched plugins, or even remote code execution flaws, they inject malicious JavaScript into the site’s HTML, templates or external JS resources [8].  Historically, SocGholish has functioned as a first-stage malware loader, ultimately leading to deployment of Cobalt Strike beacons [9], and further facilitating access persistence to corporate environments. More recently, multiple security vendors have reported that infections involving SocGholish frequently lead to the deployment of RansomHub ransomware [3] [5].

This blog explores multiple instances within Darktrace's customer base where SocGholish deployment led to subsequent network compromises. Investigations revealed indicators of compromise (IoCs) similar to those identified by external security researchers, along with variations in attacker behavior post-deployment. Key innovations in post-compromise activities include credential access tactics targeting authentication mechanisms, particularly through the abuse of legacy protocols like WebDAV and SCF file interactions over SMB.

Initial access and execution

Since January 2025, Darktrace’s Threat Research team observed multiple cases in which threat actors leveraged the SocGholish loader for initial access. Malicious actors commonly deliver SocGholish by compromising legitimate websites by injecting malicious scripts into the HTML of the affected site. When the visitor lands on an infected site, they are typically redirected to a fake browser update page, tricking them into downloading a ZIP file containing a JavaScript-based loader [1] [2]. In one case, a targeted user appears to have visited the compromised website garagebevents[.]com (IP: 35.203.175[.]30), from which around 10 MB of data was downloaded.

Device Event Log showing connections to the compromised website, following by connections to the identified Keitaro TDS instances.
Figure 1: Device Event Log showing connections to the compromised website, following by connections to the identified Keitaro TDS instances.

Within milliseconds of the connection establishment, the user’s device initiated several HTTPS sessions over the destination port 443 to the external endpoint 176.53.147[.]97, linked to the following Keitaro TDS domains:

  • packedbrick[.]com
  • rednosehorse[.]com
  • blackshelter[.]org
  • blacksaltys[.]com

To evade detection, SocGholish uses highly obfuscated code and relies on traffic distribution systems (TDS) [3].  TDS is a tool used in digital and affiliate marketing to manage and distribute incoming web traffic based on predefined rules. More specifically, Keitaro is a premium self-hosted TDS frequently utilized by attackers as a payload repository for malicious scripts following redirects from compromised sites. In the previously noted example, it appears that the device connected to the compromised website, which then retrieved JavaScript code from the aforementioned Keitaro TDS domains. The script served by those instances led to connections to the endpoint virtual.urban-orthodontics[.]com (IP: 185.76.79[.]50), successfully completing SocGholish’s distribution.

Advanced Search showing connections to the compromised website, following by those to the identified Keitaro TDS instances.
Figure 2: Advanced Search showing connections to the compromised website, following by those to the identified Keitaro TDS instances.

Persistence

During some investigations, Darktrace researchers observed compromised devices initiating HTTPS connections to the endpoint files.pythonhosted[.]org (IP: 151.101.1[.]223), suggesting Python package downloads. External researchers have previously noted how attackers use Python-based backdoors to maintain access on compromised endpoints following initial access via SocGholish [5].

Credential access and lateral movement

Credential access – external

Darktrace researchers identified observed some variation in kill chain activities following initial access and foothold establishment. For example, Darktrace detected interesting variations in credential access techniques. In one such case, an affected device attempted to contact the rare external endpoint 161.35.56[.]33 using the Web Distributed Authoring and Versioning (WebDAV) protocol. WebDAV is an extension of the HTTP protocol that allows users to collaboratively edit and manage files on remote web servers. WebDAV enables remote shares to be mounted over HTTP or HTTPS, similar to how SMB operates, but using web-based protocols. Windows supports WebDAV natively, which means a UNC path pointing to an HTTP or HTTPS resource can trigger system-level behavior such as authentication.

In this specific case, the system initiated outbound connections using the ‘Microsoft-WebDAV-MiniRedir/10.0.19045’ user-agent, targeting the URI path of /s on the external endpoint 161.35.56[.]33. During these requests, the host attempted to initiate NTML authentication and even SMB sessions over the web, both of which failed. Despite the session failures, these attempts also indicate a form of forced authentication. Forced authentication exploits a default behavior in Windows where, upon encountering a UNC path, the system will automatically try to authenticate to the resource using NTML – often without any user interaction. Although no files were directly retrieved, the WebDAV server was still likely able to retrieve the user’s NTLM hash during the session establishment requests, which can later be used by the adversary to crack the password offline.

Credential access – internal

In another investigated incident, Darktrace observed a related technique utilized for credential access and lateral movement. This time, the infected host uploaded a file named ‘Thumbs.scf’ to multiple internal SMB network shares. Shell Command File ( SCF) is a legacy Windows file format used primarily for Windows Explorer shortcuts. These files contain instructions for rendering icons or triggering shell commands, and they can be executed implicitly when a user simply opens a folder containing the file – no clicks required.

The ‘Thumbs.scf’ file dropped by the attacker was crafted to exploit this behavior. Its contents included a [Shell] section with the Command=2 directive and an IconFile path pointing to a remote UNC resource on the same external endpoint, 161.35.56[.]33, seen in the previously described case – specifically, ‘\\161.35.56[.]33\share\icon.ico’. When a user on the internal network navigates to the folder containing the SCF file, their system will automatically attempt to load the icon. In doing so, the system issues a request to the specified UNC path, which again prompts Windows to initiate NTML authentication.

This pattern of activity implies that the attacker leveraged passive internal exposure; users who simply browsed a compromised share would unknowingly send their NTML hashes to an external attacker-controlled host. Unlike the WebDAV approach, which required initiating outbound communication from the infected host, this SCF method relies on internal users to interact with poisoned folders.

Figure 3: Contents of the file 'Thumbs.scf' showing the UNC resource hosted on the external endpoint.
Figure 3: Contents of the file 'Thumbs.scf' showing the UNC resource hosted on the external endpoint.

Command-and-control

Following initial compromise, affected devices would then attempt outbound connections using the TLS/SSL protocol over port 443 to different sets of command-and-control (C2) infrastructure associated with SocGholish. The malware frequently uses obfuscated JavaScript loaders to initiate its infection chain, and once dropped, the malware communicates back to its infrastructure over standard web protocols, typically using HTTPS over port 443. However, this set of connections would precede a second set of outbound connections, this time to infrastructure linked to RansomHub affiliates, possibly facilitating the deployed Python-based backdoor.

Connectivity to RansomHub infrastructure relied on defense evasion tactics, such as port-hopping. The idea behind port-hopping is to disguise C2 traffic by avoiding consistent patterns that might be caught by firewalls, and intrusion detection systems. By cycling through ephemeral ports, the malware increases its chances of slipping past basic egress filtering or network monitoring rules that only scrutinize common web traffic ports like 443 or 80. Darktrace analysts identified systems connecting to destination ports such as 2308, 2311, 2313 and more – all on the same destination IP address associated with the RansomHub C2 environment.

Figure 4: Advanced Search connection logs showing connections over destination ports that change rapidly.

Conclusion

Since the beginning of 2025, Darktrace analysts identified a campaign whereby ransomware affiliates leveraged SocGholish to establish network access in victim environments. This activity enabled multiple sets of different post exploitation activity. Credential access played a key role, with affiliates abusing WebDAV and NTML over SMB to trigger authentication attempts. The attackers were also able to plant SCF files internally to expose NTML hashes from users browsing shared folders. These techniques evidently point to deliberate efforts at early lateral movement and foothold expansion before deploying ransomware. As ransomware groups continue to refine their playbooks and work more closely with sophisticated loaders, it becomes critical to track not just who is involved, but how access is being established, expanded, and weaponized.

Credit to Chrisina Kreza (Cyber Analyst) and Adam Potter (Senior Cyber Analyst)

Appendices

Darktrace / NETWORK model alerts

·       Anomalous Connection / SMB Enumeration

·       Anomalous Connection / Multiple Connections to New External TCP Port

·       Anomalous Connection / Multiple Failed Connections to Rare Endpoint

·       Anomalous Connection / New User Agent to IP Without Hostname

·       Compliance / External Windows Communication

·       Compliance / SMB Drive Write

·       Compromise / Large DNS Volume for Suspicious Domain

·       Compromise / Large Number of Suspicious Failed Connections

·       Device / Anonymous NTML Logins

·       Device / External Network Scan

·       Device / New or Uncommon SMB Named Pipe

·       Device / SMB Lateral Movement

·       Device / Suspicious SMB Activity

·       Unusual Activity / Unusual External Activity

·       User / Kerberos Username Brute Force

MITRE ATT&CK mapping

·       Credential Access – T1187 Forced Authentication

·       Credential Access – T1110 Brute Force

·       Command and Control – T1071.001 Web Protocols

·       Command and Control – T1571 Non-Standard Port

·       Discovery – T1083 File and Directory Discovery

·       Discovery – T1018 Remote System Discovery

·       Discovery – T1046 Network Service Discovery

·       Discovery – T1135 Network Share Discovery

·       Execution – T1059.007 JavaScript

·       Lateral Movement – T1021.002 SMB/Windows Admin Shares

·       Resource Deployment – T1608.004 Drive-By Target

List of indicators of compromise (IoCs)

·       garagebevents[.]com – 35.203.175[.]30 – Possibly compromised website

·       packedbrick[.]com – 176.53.147[.]97 – Keitaro TDS Domains used for SocGholish Delivery

·       rednosehorse[.]com – 176.53.147[.]97 – Keitaro TDS Domains used for SocGholish Delivery

·       blackshelter[.]org – 176.53.147[.]97 – Keitaro TDS Domains used for SocGholish Delivery

·       blacksaltys[.]com – 176.53.147[.]97 – Keitaro TDS Domains used for SocGholish Delivery

·       virtual.urban-orthodontics[.]com – 185.76.79[.]50

·       msbdz.crm.bestintownpro[.]com – 166.88.182[.]126 – SocGholish C2

·       185.174.101[.]240 – RansomHub Python C2

·       185.174.101[.]69 – RansomHub Python C2

·       108.181.182[.]143 – RansomHub Python C2

References

[1] https://www.checkpoint.com/cyber-hub/threat-prevention/what-is-malware/socgholish-malware/

[2] https://intel471.com/blog/threat-hunting-case-study-socgholish

[3] https://www.trendmicro.com/en_us/research/25/c/socgholishs-intrusion-techniques-facilitate-distribution-of-rans.html

[4] https://www.proofpoint.com/us/blog/threat-insight/update-fake-updates-two-new-actors-and-new-mac-malware

[5] https://www.guidepointsecurity.com/blog/ransomhub-affiliate-leverage-python-based-backdoor/

[6] https://www.cybereason.com/blog/how-do-initial-access-brokers-enable-ransomware-attacks

[7] https://attack.mitre.org/software/S1124/

[8] https://expel.com/blog/incident-report-spotting-socgholish-wordpress-injection/

[9] https://www.esentire.com/blog/socgholish-to-cobalt-strike-in-10-minutes

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About the author
Christina Kreza
Cyber Analyst

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May 1, 2025

Your Vendors, Your Risk: Rethinking Third-Party Security in the Age of Supply Chain Attacks

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When most people hear the term supply chain attack, they often imagine a simple scenario: one organization is compromised, and that compromise is used as a springboard to attack another. This kind of lateral movement is common, and often the entry vector is as mundane and as dangerous as email.

Take, for instance, a situation where a trusted third-party vendor is breached. An attacker who gains access to their systems can then send malicious emails to your organization, emails that appear to come from a known and reputable source. Because the relationship is trusted, traditional phishing defenses may not be triggered, and recipients may be more inclined to engage with malicious content. From there, the attacker can establish a foothold, move laterally, escalate privileges, and launch a broader campaign.

This is one dimension of a supply chain cyber-attack, and it’s well understood in many security circles. But the risk doesn’t end there. In fact, it goes deeper, and it often hits the most important asset of all: your customers' data.

The risk beyond the inbox

What happens when customer data is shared with a third party for legitimate processing purposes for example billing, analytics, or customer service and that third party is then compromised?

In that case, your customer data is breached, even if your own systems were never touched. That’s the uncomfortable truth about modern cybersecurity: your risk is no longer confined to your own infrastructure. Every entity you share data with becomes an extension of your attack surface. Thus, we should rethink how we perceive responsibility.

It’s tempting to think that securing our environment is our job, and securing their environment is theirs. But if a breach of their environment results in the exposure of our customers, the accountability and reputational damage fall squarely on our shoulders.

The illusion of boundaries

In an era where digital operations are inherently interconnected, the lines of responsibility can blur quickly. Legally and ethically, organizations are still responsible for the data they collect even if that data is processed, stored, or analyzed by a third party. A customer whose data is leaked because of a vendor breach will almost certainly hold the original brand responsible, not the third-party processor they never heard of.

This is particularly important for industries that rely on extensive outsourcing and platform integrations (SaaS platforms, marketing tools, CRMs, analytics platforms, payment processors). The list of third-party vendors with access to customer data grows year over year. Each integration adds convenience, but also risk.

Encryption isn’t a silver bullet

One of the most common safeguards used in these data flows is encryption. Encrypting customer data in transit is a smart and necessary step, but it’s far from enough. Once data reaches the destination system, it typically needs to be decrypted for use. And the moment it is decrypted, it becomes vulnerable to a variety of attacks like ransomware, data exfiltration, privilege escalation, and more.

In other words, the question isn’t just is the data secure in transit? The more important question is how is it protected once it arrives?

A checklist for organizations evaluating third-parties

Given these risks, what should responsible organizations do when they need to share customer data with third parties?

Start by treating third-party security as an extension of your own security program. Here are some foundational controls that can make a difference:

Due diligence before engagement: Evaluate third-party vendors based on their security posture before signing any contracts. What certifications do they hold? What frameworks do they follow? What is their incident response capability?

Contractual security clauses: Build in specific security requirements into vendor contracts. These can include requirements for encryption standards, access control policies, and data handling protocols.

Third-party security assessments: Require vendors to provide evidence of their security controls. Independent audits, penetration test results, and SOC 2 reports can all provide useful insights.

Ongoing monitoring and attestations: Security isn’t static. Make sure vendors provide regular security attestations and reports. Where possible, schedule periodic reviews or audits, especially for vendors handling sensitive data.

Minimization and segmentation: Don’t send more data than necessary. Data minimization limits the exposure in the event of a breach. Segmentation, both within your environment and within vendor access levels, can further reduce risk.

Incident response planning: Ensure you have a playbook for handling third-party incidents, and that vendors do as well. Coordination in the event of a breach should be clear and rapid.

The human factor: Customers and communication

There’s another angle to supply chain cyber-attacks that’s easy to overlook: the post-breach exploitation of public knowledge. When a breach involving customer data hits the news, it doesn’t take long for cybercriminals to jump on the opportunity.

Attackers can craft phishing emails that appear to be follow-ups from the affected organization: “Click here to reset your password,” “Confirm your details due to the breach,” etc.

A breach doesn’t just put customer data at risk it also opens the door to further fraud, identity theft, and financial loss through social engineering. This is why post-breach communication and phishing mitigation strategies are valuable components of an incident response strategy.

Securing what matters most

Ultimately, protecting against supply chain cyber-attacks isn’t just about safeguarding your own perimeter. It’s about defending the integrity of your customers’ data, wherever it goes. When customer data is entrusted to you, the duty of care doesn’t end at your firewall.

Relying on vendors to “do their part” is not enough. True due diligence means verifying, validating, and continuously monitoring those extended attack surfaces. It means designing controls that assume failure is possible, and planning accordingly.

In today’s threat landscape, cybersecurity is no longer just a technical discipline. It’s a trust-building exercise. Your customers expect you to protect their information, and rightly so. And when a supply chain attack happens, whether the breach originated with you or your partner, the damage lands in the same place: your brand, your customers, your responsibility.

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About the author
Tony Jarvis
VP, Field CISO | Darktrace
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