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January 31, 2024

How Darktrace Defeated SmokeLoader Malware

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31
Jan 2024
Read how Darktrace's AI identified and neutralized SmokeLoader malware. Gain insights into their proactive approach to cybersecurity.

What is Loader Malware?

Loader malware is a type of malicious software designed primarily to infiltrate a system and then download and execute additional malicious payloads.

In recent years, loader malware has emerged as a significant threat for organizations worldwide. This trend is expected to continue given the widespread availability of many loader strains within the Malware-as-a-Service (MaaS) marketplace. The MaaS marketplace contains a wide variety of innovative strains which are both affordable, with toolkits ranging from USD 400 to USD 1,650 [1], and continuously improving, aiming to avoid traditional detection mechanisms.

SmokeLoader is one such example of a MaaS strain that has been observed in the wild since 2011 and continues to pose a significant threat to organizations and their security teams.

How does SmokeLoader Malware work?

SmokeLoader’s ability to drop an array of different malware strains onto infected systems, from backdoors, ransomware, cryptominers, password stealers, point-of-sale malware and banking trojans, means its a highly versatile loader that has remained consistently popular among threat actors.

In addition to its versatility, it also exhibits advanced evasion strategies that make it difficult for traditional security solutions to detect and remove, and it is easily distributed via methods like spam emails or malicious file downloads.

Between July and August 2023, Darktrace observed an increasing trend in SmokeLoader compromises across its customer base. The anomaly-based threat detection capabilities of Darktrace, coupled with the autonomous response technology, identified and contained the SmokeLoader infections in their initial stages, preventing attackers from causing further disruption by deploying other malicious software or ransomware.

SmokeLoader Malware Attack Details

PROPagate Injection Technique

SmokeLoader utilizes the PROPagate code injection technique, a less common method that inserts malicious code into existing processes in order to appear legitimate and bypass traditional signature-based security measures [2] [3]. In the case of SmokeLoader, this technique exploits the Windows SetWindowsSubclass function, which is typically used to add or change the behavior of Windows Operation System. By manipulating this function, SmokeLoader can inject its code into other running processes, such as the Internet Explorer. This not only helps to disguise  the malware's activity but also allows attackers to leverage the permissions and capabilities of the infected process.

Obfuscation Methods

SmokeLoader is known to employ several obfuscation techniques to evade the detection and analysis of security teams. The techniques include scrambling portable executable files, encrypting its malicious code, obfuscating API functions and packing, and are intended to make the malware’s code appear harmless or unremarkable to antivirus software. This allows attackers to slip past defenses and execute their malicious activities while remaining undetected.

Infection Vector and Communication

SmokeLoader typically spreads via phishing emails that employ social engineering tactics to convince users to unknowingly download malicious payloads and execute the malware. Once installed on target networks, SmokeLoader acts as a backdoor, allowing attackers to control infected systems and download further malicious payloads from command-and-control (C2) servers. SmokeLoader uses fast flux, a DNS technique utilized by botets whereby IP addresses associated with C2 domains are rapidly changed, making it difficult to trace the source of the attack. This technique also boosts the resilience of attack, as taking down one or two malicious IP addresses will not significantly impact the botnet's operation.

Continuous Evolution

As with many MaaS strains, SmokeLoader is continuously evolving, with its developers regularly adding new features and techniques to increase its effectiveness and evasiveness. This includes new obfuscation methods, injection techniques, and communication protocols. This constant evolution makes SmokeLoader a significant threat and underscores the importance of advanced threat detection and response capabilities solution.

Darktrace’s Coverage of SmokeLoader Attack

Between July and August 2023, Darktrace detected one particular SmokeLoader infection at multiple stages of its kill chain on a customer network. This detection was made possible by Darktrace DETECT’s anomaly-based approach and Self-Learning AI that allows it to identify subtle deviations in device behavior.

One of the key components of this process is the classification of endpoint rarity and determining whether an endpoint is new or unusual for any given network. This classification is applied to various aspects of observed endpoints, such as domains, IP addresses, or hostnames within the network. It thereby plays a vital role in identifying SmokeLoader activity, such as the initial infection vector or C2 communication, which typically involve a device contacting a malicious endpoint associated with SmokeLoader.

The First Signs of Infection SmokeLoader Infection

Beginning in July 2023, Darktrace observed a surge in suspicious activities that were assessed with moderate to high confidence to be associated with SmokeLoader malware.

For example on July 30, a device was observed making a successful HTTPS request to humman[.]art, a domain that had never been seen on the network, and therefore classified as 100% rare by DETECT. During this connection, the device in question received a total of 6.0 KiB of data from the unusual endpoint. Open-source intelligence (OSINT) sources reported with high confidence that this domain was associated with the SmokeLoader C2 botnet.

The device was then detected making an HTTP request to another 100% rare external IP, namely 85.208.139[.]35, using a new user agent. This request contained the URI ‘/DefenUpdate.exe’, suggesting a possible download of an executable (.exe) file. This was corroborated by the total amount of data received in this connection, 4.3 MB. Both the file name and its size suggest that the offending device may have downloaded additional malicious tooling from the SmokeLoader C2 endpoint, such as a trojan or information stealer, as reported on OSINT platforms [4].

Figure 1: Device event log showing the moment when a device made its first connection to a SmokeLoader associated domain, and the use of a new user agent. A few seconds later, the DETECT model “Anomalous Connection / New User Agent to IP Without Hostname” breached.

The observed new user agent, “Mozilla/5.0 (Windows NT 10.0; Win64; x64; Trident/7.0; rv:11.0) like Gecko” was identified as suspicious by Darktrace leading to the “Anomalous Connection / New User Agent to IP Without Hostname” DETECT model breach.

As this specific user agent was associated with the Internet Explorer browser running on Windows 10, it may not have appeared suspicious to traditional security tools. However, Darktrace’s anomaly-based detection allows it to identify and mitigate emerging threats, even those that utilize sophisticated evasion techniques.

This is particularly noteworthy in this case because, as discussed earlier, SmokeLoader is known to inject its malicious code into legitimate processes, like Internet Explorer.

Figure 2: Darktrace detecting the affected device leveraging a new user agent and establishing an anomalous HTTP connection with an external IP, which was 100% rare to the network.

C2 Communication

Darktrace continued to observe the device making repeated connections to the humman[.]art endpoint. Over the next few days. On August 7, the device was observed making unusual POST requests to the endpoint using port 80, breaching the ‘Anomalous Connection / Multiple HTTP POSTs to Rare Hostname’ DETECT model. These observed POST requests were observed over a period of around 10 days and consisted of a pattern of 8 requests, each with a ten-minute interval.

Figure 3: Model Breach Event Log highlighting the Darktrace DETECT model breach ‘Anomalous Connection / Multiple HTTP POSTs to Rare Hostname’.

Upon investigating the details of this activity identified by Darktrace DETECT, a particular pattern was observed in these requests: they used the same user-agent, “Mozilla/5.0 (Windows NT 10.0; Win64; x64; Trident/7.0; rv:11.0) like Gecko”, which was previously detected in the initial breach.

Additionally, they the requests had a constantly changing  eferrer header, possibly using randomly generated domain names for each request. Further examination of the packet capture (PCAP) from these requests revealed that the payload in these POST requests contained an RC4 encrypted string, strongly indicating SmokeLoader C2 activity.

Figure4: Advanced Search results display an unusual pattern in the requests made by the device to the hostname humman[.]art. This pattern shows a constant change in the referrer header for each request, indicating anomalous behavior.
Figure 5: The PCAP shows the payload seen in these POST requests contained an RC4 encrypted string strongly indicating SmokeLoader C2 activity.  

Unfortunately in this case, Darktrace RESPOND was not active on the network meaning that the attack was able to progress through its kill chain. Despite this, the timely alerts and detailed incident insights provided by Darktrace DETECT allowed the customer’s security team to begin their remediation process, implementing blocks on their firewall, thus preventing the SmokeLoader malware from continuing its communication with C2 infrastructure.

Darktrace RESPOND Halting Potential Threats from the Initial Stages of Detection

With Darktrace RESPOND, organizations can move beyond threat detection to proactive defense against emerging threats. RESPOND is designed to halt threats as soon as they are identified by DETECT, preventing them from escalating into full-blown compromises. This is achieved through advanced machine learning and Self-Learning AI that is able to understand  the normal ‘pattern of life’ of customer networks, allowing for swift and accurate threat detection and response.

One pertinent example was seen on July 6, when Darktrace detected a separate SmokeLoader case on a customer network with RESPOND enabled in autonomous response mode. Darktrace DETECT initially identified a string of anomalous activity associated with the download of suspicious executable files, triggering the ‘Anomalous File / Multiple EXE from Rare External Locations’ model to breach.

The device was observed downloading an executable file (‘6523.exe’ and ‘/g.exe’) via HTTP over port 80. These downloads originated from endpoints that had never been seen within the customer’s environment, namely ‘hugersi[.]com’ and ‘45.66.230[.]164’, both of which had strongly been linked to SmokeLoader by OSINT sources, likely indicating the initial infection stage of the attack [5].

Figure 6: This figure illustrates Darktrace DETECT observing a device downloading multiple .exe files from rare endpoints and the associated model breach, ‘Anomalous File / Multiple EXE from Rare External Locations’.

Around the same time, Darktrace also observed the same device downloading an unusual file with a numeric file name. Threat actors often employ this tactic in order to avoid using file name patterns that could easily be recognized and blocked by traditional security measures; by frequently changing file names, malicious executables are more likely to remain undetected.

Figure 7: Graph showing the unusually high number of executable files downloaded by the device during the initial infection stage of the attack. The orange and red circles represent the number of model breaches that the device made during the observed activity related to SmokeLoader infection.
Figure 8: This figure illustrates the moment when Darktrace DETECT identified a suspicious download with a numeric file name.

With Darktrace RESPOND active and enabled in autonomous response mode, the SmokeLoader infection was thwarted in the first instance. RESPOND took swift autonomous action by blocking connections to the suspicious endpoints identified by DETECT, blocking all outgoing traffic, and enforcing a pre-established “pattern of life” on offending devices. By enforcing a patten of life on a device, Darktrace RESPOND ensures that it cannot deviate from its ‘normal’ activity to carry out potentially malicious activity, while allowing the device to continue expected business operations.

Figure 9:  A total of 8 RESPOND actions were applied, including blocking connections to suspicious endpoints and domains associated with SmokeLoader.

In addition to the autonomous mitigative actions taken by RESPOND, this customer also received a Proactive Threat Notification (PTN) informing them of potentially malicious activity on their network. This prompted the Darktrace Security Operations Center (SOC) to investigate and document the incident, allowing the customer’s security team to shift their focus to remediating and removing the threat of SmokeLoader.

Conclusion

Ultimately, Darktrace showcased its ability to detect and contain versatile and evasive strains of loader malware, like SmokeLoader. Despite its adeptness at bypassing conventional security tools by frequently changing its C2 infrastructure, utilizing existing processes to infect malicious code, and obfuscating malicious file and domain names, Darktrace’s anomaly-based approach allowed it to recognize such activity as deviations from expected network behavior, regardless of their apparent legitimacy.

Considering SmokeLoader’s wide array of functions, including C2 communication that could be used to facilitate additional attacks like exfiltration, or even the deployment of information-stealers or ransomware, Darktrace proved to be crucial in safeguarding customer networks. By identifying and mitigating SmokeLoader at the earliest possible stage, Darktrace effectively prevented the compromises from escalating into more damaging and disruptive compromises.

With the threat of loader malware expected to continue growing alongside the boom of the MaaS industry, it is paramount for organizations to adopt proactive security solutions, like Darktrace DETECT+RESPOND, that are able to make intelligent decisions to identify and neutralize sophisticated attacks.

Credit to Patrick Anjos, Senior Cyber Analyst, Justin Torres, Cyber Analyst

Appendices

Darktrace DETECT Model Detections

- Anomalous Connection / New User Agent to IP Without Hostname

- Anomalous Connection / Multiple HTTP POSTs to Rare Hostname

- Anomalous File / Multiple EXE from Rare External Locations

- Anomalous File / Numeric File Download

List of IOCs (IOC / Type / Description + Confidence)

- 85.208.139[.]35 / IP / SmokeLoader C2 Endpoint

- 185.174.137[.]109 / IP / SmokeLoader C2 Endpoint

- 45.66.230[.]164 / IP / SmokeLoader C2 Endpoint

- 91.215.85[.]147 / IP / SmokeLoader C2 Endpoint

- tolilolihul[.]net / Hostname / SmokeLoader C2 Endpoint

- bulimu55t[.]net / Hostname / SmokeLoader C2 Endpoint

- potunulit[.]org / Hostname / SmokeLoader C2 Endpoint

- hugersi[.]com / Hostname / SmokeLoader C2 Endpoint

- human[.]art / Hostname / SmokeLoader C2 Endpoint

- 371b0d5c867c2f33ae270faa14946c77f4b0953 / SHA1 / SmokeLoader Executable

References:

[1] https://bazaar.abuse.ch/sample/d7c395ab2b6ef69210221337ea292e204b0f73fef8840b6e64ab88595eda45b3/#intel

[2] https://malpedia.caad.fkie.fraunhofer.de/details/win.smokeloader

[3] https://www.darkreading.com/cyber-risk/breaking-down-the-propagate-code-injection-attack

[4] https://n1ght-w0lf.github.io/malware%20analysis/smokeloader/

[5] https://therecord.media/surge-in-smokeloader-malware-attacks-targeting-ukrainian-financial-gov-orgs

MITRE ATT&CK Mapping

Model: Anomalous Connection / New User Agent to IP Without Hostname

ID: T1071.001

Sub technique: T1071

Tactic: COMMAND AND CONTROL

Technique Name: Web Protocols

Model: Anomalous Connection / Multiple HTTP POSTs to Rare Hostname

ID: T1185

Sub technique: -

Tactic: COLLECTION

Technique Name: Man in the Browser

ID: T1071.001

Sub technique: T1071

Tactic: COMMAND AND CONTROL

Technique Name: Web Protocols

Model: Anomalous File / Multiple EXE from Rare External Locations

ID: T1189

Sub technique: -

Tactic: INITIAL ACCESS

Technique Name: Drive-by Compromise

ID: T1588.001

Sub technique: - T1588

Tactic: RESOURCE DEVELOPMENT

Technique Name: Malware

Model: Anomalous File / Numeric File Download

ID: T1189

Sub technique: -

Tactic: INITIAL ACCESS

Technique Name: Drive-by Compromise

ID: T1588.001

Sub technique: - T1588

Tactic: RESOURCE DEVELOPMENT

Technique Name: Malware

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.
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Patrick Anjos
Senior Cyber Analyst
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March 18, 2025

Survey findings: How is AI Impacting the SOC?

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There’s no question that AI is already impacting the SOC – augmenting, assisting, and filling the gaps left by staff and skills shortages. We surveyed over 1,500 cybersecurity professionals from around the world to uncover their attitudes to AI cybersecurity in 2025. Our findings revealed striking trends in how AI is changing the way security leaders think about hiring and SOC transformation. Download the full report for the big picture, available now.

Download the full report to explore these findings in depth

The AI-human conundrum

Let’s start with some context. As the cybersecurity sector has rapidly evolved to integrate AI into all elements of cyber defense, the pace of technological advancement is outstripping the development of necessary skills. Given the ongoing challenges in security operations, such as employee burnout, high turnover rates, and talent shortages, recruiting personnel to bridge these skills gaps remains an immense challenge in today’s landscape.

But here, our main findings on this topic seem to contradict each other.

There’s no question over the impact of AI-powered threats – nearly three-quarters (74%) agree that AI-powered threats now pose a significant challenge for their organization.  

When we look at how security leaders are defending against AI-powered threats, over 3 out of 5 (62%) see insufficient personnel to manage tools and alerts as the biggest barrier.  

Yet at the same time, increasing cyber security staff is at the bottom of the priority list for survey participants, with only 11% planning to increase cybersecurity staff in 2025 – less than in 2024. What 64% of stakeholders are committed to, however, is adding new AI-powered tools onto their existing security stacks.

The conclusion? Due to pressures around hiring, defensive AI is becoming integral to the SOC as a means of augmenting understaffed teams.

How is AI plugging skills shortages in the SOC?

As explored in our recent white paper, the CISO’s Guide to Navigating the Cybersecurity Skills Shortage, 71% of organizations report unfilled cybersecurity positions, leading to the estimation that less than 10% of alerts are thoroughly vetted. In this scenario, AI has become an essential multiplier to relieve the burden on security teams.

95% of respondents agree that AI-powered solutions can significantly improve the speed and efficiency of their defenses. But how?

The area security leaders expect defensive AI to have the biggest impact is on improving threat detection, followed by autonomous response to threats and identifying exploitable vulnerabilities.

Interestingly, the areas that participants ranked less highly (reducing alert fatigue and running phishing simulation), are the tasks that AI already does well and can therefore be used already to relieve the burden of manual, repetitive work on the SOC.

Different perspectives from different sides of the SOC

CISOs and SecOps teams aren’t necessarily aligned on the AI defense question – while CISOs tend to see it as a strategic game-changer, SecOps teams on the front lines may be more sceptical, wary of its real-world reliability and integration into workflows.  

From the data, we see that while less than a quarter of execs doubt that AI-powered solutions will block and automatically respond to AI threats, about half of SecOps aren’t convinced. And only 17% of CISOs lack confidence in the ability of their teams to implement and use AI-powered solutions, whereas over 40% those in the team doubt their own ability to do so.

This gap feeds into the enthusiasm that executives share about adding AI-driven tools into the stack, while day-to-day users of the tools are more interested in improving security awareness training and improving cybersecurity tool integration.

Levels of AI understanding in the SOC

AI is only as powerful as the people who use it, and levels of AI expertise in the SOC can make or break its real-world impact. If security leaders want to unlock AI’s full potential, they must bridge the knowledge gap—ensuring teams understand not just the different types of AI, but where it can be applied for maximum value.

Only 42% of security professionals are confident that they fully understand all the types of AI in their organization’s security stack.

This data varies between job roles – executives report higher levels of understanding (60% say they know exactly which types of AI are being used) than participants in other roles. Despite having a working knowledge of using the tools day-to-day, SecOps practitioners were more likely to report having a “reasonable understanding” of the types of AI in use in their organization (42%).  

Whether this reflects a general confidence in executives rather than technical proficiency it’s hard to say, but it speaks to the importance of AI-human collaboration – introducing AI tools for cybersecurity to plug the gaps in human teams will only be effective if security professionals are supported with the correct education and training.  

Download the full report to explore these findings in depth

The full report for Darktrace’s State of AI Cybersecurity is out now. Download the paper to dig deeper into these trends, and see how results differ by industry, region, organization size, and job title.  

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March 18, 2025

Darktrace's Detection of State-Linked ShadowPad Malware

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An integral part of cybersecurity is anomaly detection, which involves identifying unusual patterns or behaviors in network traffic that could indicate malicious activity, such as a cyber-based intrusion. However, attribution remains one of the ever present challenges in cybersecurity. Attribution involves the process of accurately identifying and tracing the source to a specific threat actor(s).

Given the complexity of digital networks and the sophistication of attackers who often use proxies or other methods to disguise their origin, pinpointing the exact source of a cyberattack is an arduous task. Threat actors can use proxy servers, botnets, sophisticated techniques, false flags, etc. Darktrace’s strategy is rooted in the belief that identifying behavioral anomalies is crucial for identifying both known and novel threat actor campaigns.

The ShadowPad cluster

Between July 2024 and November 2024, Darktrace observed a cluster of activity threads sharing notable similarities. The threads began with a malicious actor using compromised user credentials to log in to the target organization's Check Point Remote Access virtual private network (VPN) from an attacker-controlled, remote device named 'DESKTOP-O82ILGG'.  In one case, the IP from which the initial login was carried out was observed to be the ExpressVPN IP address, 194.5.83[.]25. After logging in, the actor gained access to service account credentials, likely via exploitation of an information disclosure vulnerability affecting Check Point Security Gateway devices. Recent reporting suggests this could represent exploitation of CVE-2024-24919 [27,28]. The actor then used these compromised service account credentials to move laterally over RDP and SMB, with files related to the modular backdoor, ShadowPad, being delivered to the  ‘C:\PerfLogs\’ directory of targeted internal systems. ShadowPad was seen communicating with its command-and-control (C2) infrastructure, 158.247.199[.]185 (dscriy.chtq[.]net), via both HTTPS traffic and DNS tunneling, with subdomains of the domain ‘cybaq.chtq[.]net’ being used in the compromised devices’ TXT DNS queries.

Darktrace’s Advanced Search data showing the VPN-connected device initiating RDP connections to a domain controller (DC). The device subsequently distributes likely ShadowPad-related payloads and makes DRSGetNCChanges requests to a second DC.
Figure 1: Darktrace’s Advanced Search data showing the VPN-connected device initiating RDP connections to a domain controller (DC). The device subsequently distributes likely ShadowPad-related payloads and makes DRSGetNCChanges requests to a second DC.
Event Log data showing a DC making DNS queries for subdomains of ‘cbaq.chtq[.]net’ to 158.247.199[.]185 after receiving SMB and RDP connections from the VPN-connected device, DESKTOP-O82ILGG.
Figure 2: Event Log data showing a DC making DNS queries for subdomains of ‘cbaq.chtq[.]net’ to 158.247.199[.]185 after receiving SMB and RDP connections from the VPN-connected device, DESKTOP-O82ILGG.

Darktrace observed these ShadowPad activity threads within the networks of European-based customers in the manufacturing and financial sectors.  One of these intrusions was followed a few months later by likely state-sponsored espionage activity, as detailed in the investigation of the year in Darktrace’s Annual Threat Report 2024.

Related ShadowPad activity

Additional cases of ShadowPad were observed across Darktrace’s customer base in 2024. In some cases, common C2 infrastructure with the cluster discussed above was observed, with dscriy.chtq[.]net and cybaq.chtq[.]net both involved; however, no other common features were identified. These ShadowPad infections were observed between April and November 2024, with customers across multiple regions and sectors affected.  Darktrace’s observations align with multiple other public reports that fit the timeframe of this campaign.

Darktrace has also observed other cases of ShadowPad without common infrastructure since September 2024, suggesting the use of this tool by additional threat actors.

The data theft thread

One of the Darktrace customers impacted by the ShadowPad cluster highlighted above was a European manufacturer. A distinct thread of activity occurred within this organization’s network several months after the ShadowPad intrusion, in October 2024.

The thread involved the internal distribution of highly masqueraded executable files via Sever Message Block (SMB) and WMI (Windows Management Instrumentation), the targeted collection of sensitive information from an internal server, and the exfiltration of collected information to a web of likely compromised sites. This observed thread of activity, therefore, consisted of three phrases: lateral movement, collection, and exfiltration.

The lateral movement phase began when an internal user device used an administrative credential to distribute files named ‘ProgramData\Oracle\java.log’ and 'ProgramData\Oracle\duxwfnfo' to the c$ share on another internal system.  

Darktrace model alert highlighting an SMB write of a file named ‘ProgramData\Oracle\java.log’ to the c$ share on another device.
Figure 3: Darktrace model alert highlighting an SMB write of a file named ‘ProgramData\Oracle\java.log’ to the c$ share on another device.

Over the next few days, Darktrace detected several other internal systems using administrative credentials to upload files with the following names to the c$ share on internal systems:

ProgramData\Adobe\ARM\webservices.dll

ProgramData\Adobe\ARM\wksprt.exe

ProgramData\Oracle\Java\wksprt.exe

ProgramData\Oracle\Java\webservices.dll

ProgramData\Microsoft\DRM\wksprt.exe

ProgramData\Microsoft\DRM\webservices.dll

ProgramData\Abletech\Client\webservices.dll

ProgramData\Abletech\Client\client.exe

ProgramData\Adobe\ARM\rzrmxrwfvp

ProgramData\3Dconnexion\3DxWare\3DxWare.exe

ProgramData\3Dconnexion\3DxWare\webservices.dll

ProgramData\IDMComp\UltraCompare\updater.exe

ProgramData\IDMComp\UltraCompare\webservices.dll

ProgramData\IDMComp\UltraCompare\imtrqjsaqmm

Cyber AI Analyst highlighting an SMB write of a file named ‘ProgramData\Adobe\ARM\webservices.dll’ to the c$ share on an internal system.
Figure 4: Cyber AI Analyst highlighting an SMB write of a file named ‘ProgramData\Adobe\ARM\webservices.dll’ to the c$ share on an internal system.

The threat actor appears to have abused the Microsoft RPC (MS-RPC) service, WMI, to execute distributed payloads, as evidenced by the ExecMethod requests to the IWbemServices RPC interface which immediately followed devices’ SMB uploads.  

Cyber AI Analyst data highlighting a thread of activity starting with an SMB data upload followed by ExecMethod requests.
Figure 5: Cyber AI Analyst data highlighting a thread of activity starting with an SMB data upload followed by ExecMethod requests.

Several of the devices involved in these lateral movement activities, both on the source and destination side, were subsequently seen using administrative credentials to download tens of GBs of sensitive data over SMB from a specially selected server.  The data gathering stage of the threat sequence indicates that the threat actor had a comprehensive understanding of the organization’s system architecture and had precise objectives for the information they sought to extract.

Immediately after collecting data from the targeted server, devices went on to exfiltrate stolen data to multiple sites. Several other likely compromised sites appear to have been used as general C2 infrastructure for this intrusion activity. The sites used by the threat actor for C2 and data exfiltration purport to be sites for companies offering a variety of service, ranging from consultancy to web design.

Screenshot of one of the likely compromised sites used in the intrusion. 
Figure 6: Screenshot of one of the likely compromised sites used in the intrusion.

At least 16 sites were identified as being likely data exfiltration or C2 sites used by this threat actor in their operation against this organization. The fact that the actor had such a wide web of compromised sites at their disposal suggests that they were well-resourced and highly prepared.  

Darktrace model alert highlighting an internal device slowly exfiltrating data to the external endpoint, yasuconsulting[.]com.
Figure 7: Darktrace model alert highlighting an internal device slowly exfiltrating data to the external endpoint, yasuconsulting[.]com.
Darktrace model alert highlighting an internal device downloading nearly 1 GB of data from an internal system just before uploading a similar volume of data to another suspicious endpoint, www.tunemmuhendislik[.]com    
Figure 8: Darktrace model alert highlighting an internal device downloading nearly 1 GB of data from an internal system just before uploading a similar volume of data to another suspicious endpoint, www.tunemmuhendislik[.]com  

Cyber AI Analyst spotlight

Cyber AI Analyst identifying and piecing together the various steps of a ShadowPad intrusion.
Figure 9: Cyber AI Analyst identifying and piecing together the various steps of a ShadowPad intrusion.  
Cyber AI Analyst Incident identifying and piecing together the various steps of the data theft activity.
Figure 10: Cyber AI Analyst Incident identifying and piecing together the various steps of the data theft activity.

As shown in the above figures, Cyber AI Analyst’s ability to thread together the different steps of these attack chains are worth highlighting.

In the ShadowPad attack chains, Cyber AI Analyst was able to identify SMB writes from the VPN subnet to the DC, and the C2 connections from the DC. It was also able to weave together this activity into a single thread representing the attacker’s progression.

Similarly, in the data exfiltration attack chain, Cyber AI Analyst identified and connected multiple types of lateral movement over SMB and WMI and external C2 communication to various external endpoints, linking them in a single, connected incident.

These Cyber AI Analyst actions enabled a quicker understanding of the threat actor sequence of events and, in some cases, faster containment.

Attribution puzzle

Publicly shared research into ShadowPad indicates that it is predominantly used as a backdoor in People’s Republic of China (PRC)-sponsored espionage operations [5][6][7][8][9][10]. Most publicly reported intrusions involving ShadowPad  are attributed to the China-based threat actor, APT41 [11][12]. Furthermore, Google Threat Intelligence Group (GTIG) recently shared their assessment that ShadowPad usage is restricted to clusters associated with APT41 [13]. Interestingly, however, there have also been public reports of ShadowPad usage in unattributed intrusions [5].

The data theft activity that later occurred in the same Darktrace customer network as one of these ShadowPad compromises appeared to be the targeted collection and exfiltration of sensitive data. Such an objective indicates the activity may have been part of a state-sponsored operation. The tactics, techniques, and procedures (TTPs), artifacts, and C2 infrastructure observed in the data theft thread appear to resemble activity seen in previous Democratic People’s Republic of Korea (DPRK)-linked intrusion activities [15] [16] [17] [18] [19].

The distribution of payloads to the following directory locations appears to be a relatively common behavior in DPRK-sponsored intrusions.

Observed examples:

C:\ProgramData\Oracle\Java\  

C:\ProgramData\Adobe\ARM\  

C:\ProgramData\Microsoft\DRM\  

C:\ProgramData\Abletech\Client\  

C:\ProgramData\IDMComp\UltraCompare\  

C:\ProgramData\3Dconnexion\3DxWare\

Additionally, the likely compromised websites observed in the data theft thread, along with some of the target URI patterns seen in the C2 communications to these sites, resemble those seen in previously reported DPRK-linked intrusion activities.

No clear evidence was found to link the ShadowPad compromise to the subsequent data theft activity that was observed on the network of the manufacturing customer. It should be noted, however, that no clear signs of initial access were found for the data theft thread – this could suggest the ShadowPad intrusion itself represents the initial point of entry that ultimately led to data exfiltration.

Motivation-wise, it seems plausible for the data theft thread to have been part of a DPRK-sponsored operation. DPRK is known to pursue targets that could potentially fulfil its national security goals and had been publicly reported as being active in months prior to this intrusion [21]. Furthermore, the timing of the data theft aligns with the ratification of the mutual defense treaty between DPRK and Russia and the subsequent accused activities [20].

Darktrace assesses with medium confidence that a nation-state, likely DPRK, was responsible, based on our investigation, the threat actor applied resources, patience, obfuscation, and evasiveness combined with external reporting, collaboration with the cyber community, assessing the attacker’s motivation and world geopolitical timeline, and undisclosed intelligence.

Conclusion

When state-linked cyber activity occurs within an organization’s environment, previously unseen C2 infrastructure and advanced evasion techniques will likely be used. State-linked cyber actors, through their resources and patience, are able to bypass most detection methods, leaving anomaly-based methods as a last line of defense.

Two threads of activity were observed within Darktrace’s customer base over the last year: The first operation involved the abuse of Check Point VPN credentials to log in remotely to organizations’ networks, followed by the distribution of ShadowPad to an internal domain controller. The second operation involved highly targeted data exfiltration from the network of one of the customers impacted by the previously mentioned ShadowPad activity.

Despite definitive attribution remaining unresolved, both the ShadowPad and data exfiltration activities were detected by Darktrace’s Self-Learning AI, with Cyber AI Analyst playing a significant role in identifying and piecing together the various steps of the intrusion activities.  

Credit to Sam Lister (R&D Detection Analyst), Emma Foulger (Principal Cyber Analyst), Nathaniel Jones (VP), and the Darktrace Threat Research team.

Appendices

Darktrace / NETWORK model alerts

User / New Admin Credentials on Client

Anomalous Connection / Unusual Admin SMB Session

Compliance / SMB Drive Write  

Device / Anomalous SMB Followed By Multiple Model Breaches

Anomalous File / Internal / Unusual SMB Script Write

User / New Admin Credentials on Client  

Anomalous Connection / Unusual Admin SMB Session

Compliance / SMB Drive Write

Device / Anomalous SMB Followed By Multiple Model Breaches

Anomalous File / Internal / Unusual SMB Script Write

Device / New or Uncommon WMI Activity

Unusual Activity / Internal Data Transfer

Anomalous Connection / Download and Upload

Anomalous Server Activity / Rare External from Server

Compromise / Beacon to Young Endpoint

Compromise / Agent Beacon (Short Period)

Anomalous Server Activity / Anomalous External Activity from Critical Network Device

Anomalous Connection / POST to PHP on New External Host

Compromise / Sustained SSL or HTTP Increase

Compromise / Sustained TCP Beaconing Activity To Rare Endpoint

Anomalous Connection / Multiple Failed Connections to Rare Endpoint

Device / Multiple C2 Model Alerts

Anomalous Connection / Data Sent to Rare Domain

Anomalous Connection / Download and Upload

Unusual Activity / Unusual External Data Transfer

Anomalous Connection / Low and Slow Exfiltration

Anomalous Connection / Uncommon 1 GiB Outbound  

MITRE ATT&CK mapping

(Technique name – Tactic ID)

ShadowPad malware threads

Initial Access - Valid Accounts: Domain Accounts (T1078.002)

Initial Access - External Remote Services (T1133)

Privilege Escalation - Exploitation for Privilege Escalation (T1068)

Privilege Escalation - Valid Accounts: Default Accounts (T1078.001)

Defense Evasion - Masquerading: Match Legitimate Name or Location (T1036.005)

Lateral Movement - Remote Services: Remote Desktop Protocol (T1021.001)

Lateral Movement - Remote Services: SMB/Windows Admin Shares (T1021.002)

Command and Control - Proxy: Internal Proxy (T1090.001)

Command and Control - Application Layer Protocol: Web Protocols (T1071.001)

Command and Control - Encrypted Channel: Asymmetric Cryptography (T1573.002)

Command and Control - Application Layer Protocol: DNS (T1071.004)

Data theft thread

Resource Development - Compromise Infrastructure: Domains (T1584.001)

Privilege Escalation - Valid Accounts: Default Accounts (T1078.001)

Privilege Escalation - Valid Accounts: Domain Accounts (T1078.002)

Execution - Windows Management Instrumentation (T1047)

Defense Evasion - Masquerading: Match Legitimate Name or Location (T1036.005)

Defense Evasion - Obfuscated Files or Information (T1027)

Lateral Movement - Remote Services: SMB/Windows Admin Shares (T1021.002)

Collection - Data from Network Shared Drive (T1039)

Command and Control - Application Layer Protocol: Web Protocols (T1071.001)

Command and Control - Encrypted Channel: Asymmetric Cryptography (T1573.002)

Command and Control - Proxy: External Proxy (T1090.002)

Exfiltration - Exfiltration Over C2 Channel (T1041)

Exfiltration - Data Transfer Size Limits (T1030)

List of indicators of compromise (IoCs)

IP addresses and/or domain names (Mid-high confidence):

ShadowPad thread

- dscriy.chtq[.]net • 158.247.199[.]185 (endpoint of C2 comms)

- cybaq.chtq[.]net (domain name used for DNS tunneling)  

Data theft thread

- yasuconsulting[.]com (45.158.12[.]7)

- hobivan[.]net (94.73.151[.]72)

- mediostresbarbas.com[.]ar (75.102.23[.]3)

- mnmathleague[.]org (185.148.129[.]24)

- goldenborek[.]com (94.138.200[.]40)

- tunemmuhendislik[.]com (94.199.206[.]45)

- anvil.org[.]ph (67.209.121[.]137)

- partnerls[.]pl (5.187.53[.]50)

- angoramedikal[.]com (89.19.29[.]128)

- awork-designs[.]dk (78.46.20[.]225)

- digitweco[.]com (38.54.95[.]190)

- duepunti-studio[.]it (89.46.106[.]61)

- scgestor.com[.]br (108.181.92[.]71)

- lacapannadelsilenzio[.]it (86.107.36[.]15)

- lovetamagotchith[.]com (203.170.190[.]137)

- lieta[.]it (78.46.146[.]147)

File names (Mid-high confidence):

ShadowPad thread:

- perflogs\1.txt

- perflogs\AppLaunch.exe

- perflogs\F4A3E8BE.tmp

- perflogs\mscoree.dll

Data theft thread

- ProgramData\Oracle\java.log

- ProgramData\Oracle\duxwfnfo

- ProgramData\Adobe\ARM\webservices.dll

- ProgramData\Adobe\ARM\wksprt.exe

- ProgramData\Oracle\Java\wksprt.exe

- ProgramData\Oracle\Java\webservices.dll

- ProgramData\Microsoft\DRM\wksprt.exe

- ProgramData\Microsoft\DRM\webservices.dll

- ProgramData\Abletech\Client\webservices.dll

- ProgramData\Abletech\Client\client.exe

- ProgramData\Adobe\ARM\rzrmxrwfvp

- ProgramData\3Dconnexion\3DxWare\3DxWare.exe

- ProgramData\3Dconnexion\3DxWare\webservices.dll

- ProgramData\IDMComp\UltraCompare\updater.exe

- ProgramData\IDMComp\UltraCompare\webservices.dll

- ProgramData\IDMComp\UltraCompare\imtrqjsaqmm

- temp\HousecallLauncher64.exe

Attacker-controlled device hostname (Mid-high confidence)

- DESKTOP-O82ILGG

References  

[1] https://www.kaspersky.com/about/press-releases/shadowpad-how-attackers-hide-backdoor-in-software-used-by-hundreds-of-large-companies-around-the-world  

[2] https://media.kasperskycontenthub.com/wp-content/uploads/sites/43/2017/08/07172148/ShadowPad_technical_description_PDF.pdf

[3] https://blog.avast.com/new-investigations-in-ccleaner-incident-point-to-a-possible-third-stage-that-had-keylogger-capacities

[4] https://securelist.com/operation-shadowhammer-a-high-profile-supply-chain-attack/90380/

[5] https://assets.sentinelone.com/c/Shadowpad?x=P42eqA

[6] https://www.cyfirma.com/research/the-origins-of-apt-41-and-shadowpad-lineage/

[7] https://www.csoonline.com/article/572061/shadowpad-has-become-the-rat-of-choice-for-several-state-sponsored-chinese-apts.html

[8] https://global.ptsecurity.com/analytics/pt-esc-threat-intelligence/shadowpad-new-activity-from-the-winnti-group

[9] https://cymulate.com/threats/shadowpad-privately-sold-malware-espionage-tool/

[10] https://www.secureworks.com/research/shadowpad-malware-analysis

[11] https://blog.talosintelligence.com/chinese-hacking-group-apt41-compromised-taiwanese-government-affiliated-research-institute-with-shadowpad-and-cobaltstrike-2/

[12] https://hackerseye.net/all-blog-items/tails-from-the-shadow-apt-41-injecting-shadowpad-with-sideloading/

[13] https://cloud.google.com/blog/topics/threat-intelligence/scatterbrain-unmasking-poisonplug-obfuscator

[14] https://www.domaintools.com/wp-content/uploads/conceptualizing-a-continuum-of-cyber-threat-attribution.pdf

[15] https://www.nccgroup.com/es/research-blog/north-korea-s-lazarus-their-initial-access-trade-craft-using-social-media-and-social-engineering/  

[16] https://www.microsoft.com/en-us/security/blog/2021/01/28/zinc-attacks-against-security-researchers/

[17] https://www.microsoft.com/en-us/security/blog/2022/09/29/zinc-weaponizing-open-source-software/  

[18] https://www.welivesecurity.com/en/eset-research/lazarus-luring-employees-trojanized-coding-challenges-case-spanish-aerospace-company/  

[19] https://blogs.jpcert.or.jp/en/2021/01/Lazarus_malware2.html  

[20] https://usun.usmission.gov/joint-statement-on-the-unlawful-arms-transfer-by-the-democratic-peoples-republic-of-korea-to-russia/

[21] https://media.defense.gov/2024/Jul/25/2003510137/-1/-1/1/Joint-CSA-North-Korea-Cyber-Espionage-Advance-Military-Nuclear-Programs.PDF  

[22] https://kyivindependent.com/first-north-korean-troops-deployed-to-front-line-in-kursk-oblast-ukraines-military-intelligence-says/

[23] https://www.microsoft.com/en-us/security/blog/2024/12/04/frequent-freeloader-part-i-secret-blizzard-compromising-storm-0156-infrastructure-for-espionage/  

[24] https://www.microsoft.com/en-us/security/blog/2024/12/11/frequent-freeloader-part-ii-russian-actor-secret-blizzard-using-tools-of-other-groups-to-attack-ukraine/  

[25] https://www.sentinelone.com/labs/chamelgang-attacking-critical-infrastructure-with-ransomware/    

[26] https://thehackernews.com/2022/06/state-backed-hackers-using-ransomware.html/  

[27] https://blog.checkpoint.com/security/check-point-research-explains-shadow-pad-nailaolocker-and-its-protection/

[28] https://www.orangecyberdefense.com/global/blog/cert-news/meet-nailaolocker-a-ransomware-distributed-in-europe-by-shadowpad-and-plugx-backdoors

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About the author
Sam Lister
SOC Analyst
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