News / Asia

    China's Cyber Espionage Case a Guide to Hacking

    Part of the building of 'Unit 61398', a secretive Chinese military unit accused of cyber espionage in Shanghai
    Part of the building of 'Unit 61398', a secretive Chinese military unit accused of cyber espionage in Shanghai
    The alleged hacking of U.S. corporate computers by elements of China’s military wasn’t in and of itself all that unique.
     
    As cyber attacks go, it was moderately sophisticated in technique.
     
    But that raises a more troubling question.
     
    How could major international corporations — such as U.S. Steel, Alcoa and others with millions of dollars of intellectual property — get robbed by a small, low-cost group of hackers working from China?
     
    The answer: It’s surprising it doesn’t happen more often.
     
    Over its 48 pages and 31 counts of criminal misconduct, the U.S. Justice Department’s indictment details how five Chinese army officers, with Internet identities such as “Ugly Gorilla”, “Kandygoo” and “WinXYHappy,” went about infiltrating computer networks of six large U.S. corporations.
     
    Sections of the indictment are so detailed that they read like a primer, a virtual "how-to manual" for anyone interested in how hackers do what they do.
     
    Social engineering
     
    While some of the terms such as “spearphishing,” “beacon” or “hop-points” may need a little technical explaining, it’s clear from the indictment that the defendants generally employed something security analysts call social engineering.
     
    In essence, social engineering is a tactic where hackers pretend to be somebody else to try and trick the target into trusting them.
     
    The aim is getting them to reveal information directly (such as a password) or infect their computers by clicking on malicious links and attachments. Social engineering, in the end, is just a fancy label for little more than a con job.
     
    There are many different tricks a hacker might employ to earn their target’s trust.

    But once they have it, it’s relatively easy to fool unsuspecting targets into releasing sensitive information.
     
    A common example: if someone you believe is a trusted co-worker sends you an email urgently asking for a password they’ve forgotten, you’re probably much more likely to send it to them without thinking twice than someone you don’t know, analysts say.
     
    “Given that these types of attacks can be attempted with very little consequence if they don't succeed,” said Mike Auty, senior security researcher at the firm MWR Infosecurity,

    “It allows the attacker to launch a number of attacks, over a long period of time, and the chances are high that there will be a mistake, and someone will grant them access,” he said.
     
    Which, as the indictment details, is  what the Chinese are alleged to have done.
     
    One particular social engineering trick allegedly used by the defendants was “spearphishing” — sending links or attachments via email that, if clicked, would infect the target’s computer system without them knowing.
     
    Once infected, the malware would create what’s called a “back door” or secret entrance into the system that could likely go undetected for prolonged periods.
     
    In the recent indictment papers, U.S. prosecutors say that, defendant “SUN” — short for Sun Kailiang — “sent spearphishing e-mails purporting to be from two U.S. Steel e-mail accounts to approximately eight U.S. Steel employees, including U.S. Steel’s Chief Executive Officer.
     
    “The e-mails had the subject line “US Steel Industry Outlook” and contained a link to malware that, once clicked, would surreptitiously install malware on the recipients’ computers, allowing the co-conspirators backdoor access to the company’s computers,” the indictment said.

    “Further...an unidentified co-conspirator sent approximately 49 spearphishing e-mails to U.S. Steel employees with the same subject, “US Steel Industry Outlook,” according to the indictment.
     
    But it didn’t stop with basic spearphishing.
     
    Researcher Auty said successful social engineering hacks often require more than just bad emails.
     
    And the indictment lays out another, more sophisticated attack strategy that required much greater planning, research and patience.
     
    Persistence over technology
     
    Throughout the document, the Justice Department describes how the defendants would first try to gain lists of current and former employees at each of the six targeted companies and then went about researching who they were.
     
    The defendants then went about purchasing a variety of web site domain names, such as ‘arrowservice.net’ or ‘hugesoft.org’ (readers are advised NOT to visit these sites) and populating them both with content that appeared legitimate, but also contained hidden Trojan-horse malware.
     
    These websites both served to create an appearance of trust and also to serve as “hop-points” between the infected computers and the main attack servers in China to coordinate and control all the malware-infected computers in the U.S.
     
    In the indictment, attorneys detail how these hop-points could surreptitiously allow the hackers to grab documents and “exfiltrate” — a computer term that basically means stealing — the data back to China.
     
    As the indictment put it: “Between intrusions, the co-conspirators used the domain accounts to reassign the malicious domain names to non-routable or innocuous IP addresses, (e.g., IP addresses for popular webmail services, like Gmail or Yahoo), which would obscure any beacons their malware sent during that period.”
     
    “Bad guys want my stuff”
     
    Technologically speaking, it wasn’t anywhere near the sophistication of something like the Stuxnet virus.

    But for sheer persistence and imagination, it was quite a clever operation.
     
    “People need to realize: the bad guys are persistent, they’re organized,” said Stephen Cobb, a senior security researcher at the cyber security firm ESET North America. “Maybe this would help: it’s not an individual who’s trying to break into your web server every five seconds.”
     
    “Let’s face it: every company today has information on their computers that they need to protect,” Cobb said. “If you’ve got a website, there’s an attempt to break into it every five, six seconds. It’s automated programs.

    "So people from all around the world who want to get into somebody else’s computer are running automated script looking for holes," he said. "There’s a constant probing of systems.”
     
    Still, it’s hard for most people to understand cyber security, analysts say.
     
    “If you work for a bank, you should be fairly aware that people might want to rob you, that’s where the money is,” Cobb said. “But if you’re a doctor, or an engineer designing a product, you’re not necessarily thinking ‘there are bad guys who want my stuff.’‘”
     
    But security expert Auty said that’s not a cause to lose hope.
     
    “People will always be a weak element, but given that organizations have learnt to harden their perimeter, the next area of improvement required within the industry is ensuring internal visibility and appropriate segregation,” he said.
     
    For both Auty and Cobb, the segregation of data into specific areas with different levels of security is key.
     
    “You can’t protect what you don’t know about,” Cobb told VOA. “One of the very first things on my list for remediation or security programs for small business or big business is know what you’ve got.”

    Doug Bernard

    dbjohnson+voanews.com

    Doug Bernard covers cyber-issues for VOA, focusing on Internet privacy, security and censorship circumvention. Previously he edited VOA’s “Digital Frontiers” blog, produced the “Daily Download” webcast and hosted “Talk to America”, for which he won the International Presenter of the Year award from the Association for International Broadcasting. He began his career at Michigan Public Radio, and has contributed to "The New York Times," the "Christian Science Monitor," SPIN and NPR, among others. You can follow him @dfrontiers.

    You May Like

    Video As Refugees Perish, Greek Graveyards Fill

    Before burial at overflowing cemeteries, unidentified dead being swapped for DNA, in case some day relatives come to learn their fate

    Russian Opposition Leader Sues Putin for Conflict of Interest

    Alexei Navalny tells VOA in exclusive interview why transfer of $2 billion from country’s wealth fund to company with ties to President Putin’s son-in-law triggered lawsuit

    Clinton, Sanders Fight for African American Votes

    Some African American lawmakers lining up to support Clinton in face of perceived surge by Sanders in race for Democratic nomination in presidential campaign

    This forum has been closed.
    Comment Sorting
    Comments
         
    by: TheSaucyMugwump from: saucymugwump.blogspot.com
    May 25, 2014 6:23 PM
    Corporations are being hacked by both Chinese and Russians, with the former doing it for corporate espionage and the latter doing it for personal loot. Corporations today are only concerned with reducing costs and maximizing the salaries of CEOs and other corporate officers. Target and eBay outsourced a large part of their IT function and got burned.

    There is a preventative measure for phishing: before clicking on links in emails, hover the mouse over the link (but don't click on it) and read the URL in the bottom-left corner of the screen. If the URL is not what you expect, report the email as spam. It is amazing how few articles mention this simple trick.

    by: Anonymot from: Boston
    May 25, 2014 11:13 AM
    Wow! Sic 'em. They're doing what NSA & CIA are doing and we are supposed to have a global monopoly on hacking for governmental usage, both commercial for American corporate use as well "intelligence".

    It makes no sense to allow these dangerous , skilled competitors wander freely around our electronic fairs. Perhaps we should bar ALL Chinese from entering and expel those who are here who may know too much - and Japanese, too (& Indians, Pakistanis, etc.) We don't really need any other smart people in the world. We suffice.

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    As Refugees Perish, Greek Graveyards Filli
    X
    Hamada Elsaram
    February 11, 2016 8:01 PM
    Aid workers on the Greek island of Lesbos say they are struggling to bury the increasing number of bodies of refugees that have been recovered or washed up ashore in recent months.  The graveyards are all full, they say, yet as tens of thousands of people clamor to get out of Syria, it is clear refugees will still be coming in record numbers. For VOA, Hamada Elrasam reports from Lesbos, Greece.
    Video

    Video As Refugees Perish, Greek Graveyards Fill

    Aid workers on the Greek island of Lesbos say they are struggling to bury the increasing number of bodies of refugees that have been recovered or washed up ashore in recent months.  The graveyards are all full, they say, yet as tens of thousands of people clamor to get out of Syria, it is clear refugees will still be coming in record numbers. For VOA, Hamada Elrasam reports from Lesbos, Greece.
    Video

    Video To Fight Zika, Scientists Target Mosquitoes

    Mosquitoes strike again. The Zika virus outbreak is just the latest headline-grabbing epidemic carried by these biting pests, but researchers are fighting back with new ways to control them. VOA's Steve Baragona takes a look.
    Video

    Video Mosul Refugees Talk About Life Under IS

    A top U.S. intelligence official told Congress this week that a planned Iraqi-led operation to re-take the city of Mosul from Islamic State militants is unlikely to take place this year. IS took over the city in June 2014, and for the past year and a half, Mosul residents have been held captive under its rule. VOA's Zana Omar talked to some families who managed to escape. Bronwyn Benito narrates his report.
    Video

    Video Scientists Make Progress Toward Better Diabetes Treatment, Cure

    Scientists at two of the top U.S. universities say they have made significant advances in their quest to find a more efficient treatment for diabetes and eventually a cure. According to the International Diabetes Federation, the disease affects more than 370 million people worldwide. VOA’s George Putic reports.
    Video

    Video NATO to Target Migrant Smugglers

    NATO has announced plans to send warships to the Aegean Sea to target migrant smugglers in the alliance's most direct intervention so far since a wave of people began trying to reach European shores.
    Video

    Video Russia's Catholics, Orthodox Hopeful on Historic Pope-Patriarch Meeting

    Russia's Catholic minority has welcomed an historic first meeting Friday in Cuba between the Pope and the Patriarch of Russia's dominant Orthodox Church. The Orthodox Church split with Rome in 1054 and analysts say politics, both church and state, have been driving the relationship in the centuries since. VOA's Daniel Schearf reports from Moscow.
    Video

    Video Used Books Get a New Life on the Streets of Lagos

    Used booksellers are importing books from abroad and selling them on the streets of Africa's largest city. What‘s popular with readers may surprise you. Chris Stein reports from Lagos.
    Video

    Video After NH Primaries All Eyes on South Carolina

    After Tuesday's primary in New Hampshire, US presidential candidates swiftly turned to the next election coming up in South Carolina. The so-called “first-in-the-South” poll may help further narrow down the field of candidates. Zlatica Hoke reports.
    Video

    Video US Co-ed Selective Service Plan Stirs Controversy

    Young women may soon be required to register with the U.S. Selective Service System, the U.S. government agency charged with implementing a draft in a national emergency. Top Army and Marine Corps commanders told the Senate Armed Services Committee recently that women should register, and a bill has been introduced in Congress requiring eligible women to sign up for the military draft. The issue is stirring some controversy, as VOA’s Bernard Shusman reports from New York.
    Video

    Video Lessons Learned From Ebola Might Help Fight Zika

    Now that the Ebola epidemic has ended in West Africa, Zika has the world's focus. And, as Carol Pearson reports, health experts and governments are applying some of the lessons learned during the Ebola crisis in Africa to fight the Zika virus in Latin America and the Caribbean.
    Video

    Video Smartphone Helps Grow Vegetables

    One day, you may be using your smartphone to grow your vegetables. A Taipei-based company has developed a farm cube — a small, enclosed ecosystem designed to grow plants indoors. The environment inside is automatically adjusted by the cube, but it can also be controlled through an app. VOA's Deborah Block has more on the gardening system.
    Video

    Video Illinois Voters Have Mixed Emotions on Obama’s Return to Springfield

    On the ninth anniversary of the launch of his quest for national office, President Barack Obama returned to Springfield, Illinois, to speak to the Illinois General Assembly, where he once served as state senator. His visit was met with mixed emotions by those with a front-row seat on his journey to the White House. VOA's Kane Farabaugh reports.
    Video

    Video Exhibit Turns da Vinci’s Drawings Into Real Objects

    In addition to being a successful artist, Renaissance genius Leonardo da Vinci designed many practical machines, some of which are still in use today, although in different forms. But a number of his projects were never realized — until today. VOA’s George Putic reports.
    Video

    Video Heated Immigration Debate Limits Britain’s Refugee Response

    Compared to many other European states, Britain has agreed to accept a relatively small number of Syrian refugees. Just over a thousand have arrived so far -- and some are being resettled in remote corners of the country. Henry Ridgwell reports on why Britain’s response has lagged behind its neighbors.
    Video

    Video Russia's Car Sales Shrink Overall, But Luxury and Economy Models See Growth

    Car sales in Russia dropped by more than a third in 2015 because of the country's economic woes. But, at the extreme ends of the car market, luxury vehicles and some economy brands are actually experiencing growth. VOA's Daniel Schearf reports from Moscow.