AI-Powered Espionage Will Favor China

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Last week, Anthropic revealed a real-world, AI-orchestrated cyber espionage campaign. There's a real speed and scale benefit here for malicious actors that care more hacking everything than flying under the radar. Western governments, however, will likely stick to the tried and tested method of "slowly, slowly, catchy monkey".

In the report, Anthropic detailed its discovery of the campaign that used AI "not just as an advisor, but to execute the cyberattacks themselves".

Anthropic believes the threat actor was a Chinese state- group whose goals align with those of the Chinese Ministry of State Security . The group attempted to infiltrate "roughly thirty" typical victims: large tech companies, financial institutions, chemical manufacturing companies and government agencies. It succeeded in a small number of cases.

The attackers built what Anthropic calls an "autonomous attack framework". It used Claude Code to support reconnaissance, vulnerability discovery, exploitation, lateral movement, credential harvesting, data analysis, and exfiltration operations. This framework broke the attack lifecycle into discrete tasks that were carried out by Claude sub-agents. Claude Code orchestrated the entire system, aggregated results from these discrete sub-tasks and then kicked off more jobs based on its analysis of the information it discovered.

This was all done "largely autonomously". Once an operator set the wheels in motion the system would execute " 80-90% of tactical operations independently". This occurred far faster than would be possible for human hands and the system was able to hack several targets in parallel.

Human operators had specific responsibilities, per Anthropic's full report :

In other words, Claude carried out the "hands on keyboard" operations while humans were left with what we'd call management-level decisions: Accepting risk or triaging and prioritising intelligence collection.

There's been a surprising amount of skepticism from security researchers Anthropic's report. One element of this criticism focussed on the threat actor's use of open source tooling. The argument being that this should be relatively straightforward for defenders to detect, as compared to custom malware.

But the innovation here is in the framework rather than in whether any particular hacking tool or AI model was used. To us, this campaign doesn't look like a regular intelligence operation so much as a research project on how to take advantage of AI in cyber espionage campaigns. The use of open source tools is exactly what we'd expect.

The head of Anthropic's threat intelligence team, Jacob Klein, told CyberScoop the threat actor invested a significant amount of time and effort to build the attack framework.

It was the "hardest part of this entire system", Klein said. "That's what was human intensive".

Once the framework was created, however, it allowed single individuals to carry out a lot more hacking. Klein suggested that one person using the attack framework could achieve what he thinks "would have taken a team of ten folks".

Of course, it is not all roses. Anthropic writes:

For threat actors with a high risk appetite or without focus on specific targets, having an AI hacking buddy that stuffs up occasionally is a win if it allows you to do a whole lot more hacking. Think ransomware actors and even state-backed groups hacking for intellectual property. Even if they, and their AI companions, screw up on one promising victim there are plenty of other fish in the sea.

For threat actors focussed on difficult, security-conscious targets, that trade off is far more risky. There's only one Vladimir Putin, for example. One meticulous operation is a safer bet than scaled up attacks with a multitude of mostly-automated Claude-brained schemes.

From a state perspective, at least in the short term, we imagine AI-powered hacking campaigns will be adopted by countries that run broad-based hacking campaigns with a high risk appetite: here's looking at you, North Korea and China!

For Western intelligence agencies that are more tightly focussed on specific targets, it's a different story. AI will be useful as an aide and increasingly so, but the speed and scale benefits of automated attacks will be offset by the potential for errors.

Last week, Google announced it had filed litigation to disrupt the Lighthouse phishing-as-a-service kit. Per the company's announcement:

The company's lawsuit takes aim at 25 unnamed individuals who are believed to be responsible for the service and living in China. Lighthouse is used to send text messages that phish victims for payment card data, as described by Krebs On Security . Google's lawsuit claims Lighthouse has hit more than one million victims across 120 countries.

Surprisingly, given that the operators are suspected to be in China, the lawsuit actually appeared to have an immediate impact. The day Google's general counsel Halimah DeLaine Prado said that Lighthouse's operations had been shut down, which she called, "a win for everyone".

That's all good news. But Google's goals are more than just short-term disruption. DeLaine Prado told Wired one aim of the lawsuits was to enable further action by other organisations too:

Back in September , Sandra Joyce, vice president of Google's Threat Intelligence group, announced the company was starting a cyber "disruption unit" that would look for legal and ethical opportunities to disrupt threat actors.

A single lawsuit won't stop the people behind Lighthouse for good. But we are optimistic that this lawsuit is a pretty good start in an enduring campaign.

Adopting the memory safe Rust language in Android is not only safer than using C or C++, it is also more efficient from a software delivery perspective, according to Google .

Memory safety bugs are a class of vulnerabilities related to how computers read, write and store memory. They are particularly problematic, Google says , because they "tend to be significantly more severe, more likely to be remotely reachable, more versatile, and more likely to be maliciously exploited than other vulnerability types".

In editions of this we've covered how , even in large established projects, writing new code in memory safe languages such as Rust or Go is a quick win. We also praised the Biden administration's efforts to encourage the adoption of memory safe languages.

Last week Google reported that, from a security perspective, its adoption of Rust was going swimmingly. Based on data from the last few years, it reckons that per line of code, Rust is a 1000-fold less likely to contain a memory safety vulnerability than C/C++. This year, for the first time, more new code was written in Rust than C/C++. As a result, Android memory safety vulnerabilities have declined from nearly 80% of total vulnerabilities in 2019 to less than 20% this year.

Not only that, Google has crunched the numbers and found that Rust is easier and faster to deploy because it is quicker to review and is more likely to be correct. When changes are pushed out, the rollback rate for Rust is four-fold lower than C++.

Watch Amberleigh Jack and Tom Uren this edition of the :

In this Risky Business sponsor interview , Tines Field CISO Matt Muller chats with Casey Ellis the interesting and out-of-the-box ways they've seen people using the platform. Tines is a platform designed to automate repetitive tasks for IT and security teams. And, as it turns out, it can be used to … gamify shift handover?

BBC cyber correspondent Joe Tidy has an interesting interview with the former leader of the Jabber Zeus cybercrime group, Vyacheslav Penchukov, aka "The Tank".. It's an entertaining, colourful read.

Penchukov's criminal career spans two eras: from the early days of quick and easy bank account theft to the rise of ransomware. Ironically, he once tried to go straight, but returned to cybercrime because Ukrainian authorities kept shaking him down for bribes. Or so he says.

The Europol coordinated Operation Endgame announced successful operations against the Rhadamanthys infostealer, the VenomRAT remote access trojan and the Elysium botnet. [ Risky Bulletin has further coverage ]

Endgame is tackling ransomware holistically by addressing the ecosystem that supports the crime. It's great.

Last week, however, two of the operation's earlier targets, DanaBot and Lumma Stealer, returned after a hiatus. We love the goals and approach of Endgame (and its cheesy-yet-cool videos and graphic design). But the reality is cybercrime is so profitable that current law enforcement operations can only really suppress the problem, not end it.

You can find the audio edition of this and other fine podcasts and interviews in the Risky Biz News feed ( RSS , iTunes or Spotify ).

In our last "Between Two Nerds" discussion Tom Uren and The Grugq talk the strategic "logic" of Russian wiper attacks on the Ukrainian grain sector.

Or watch it on YouTube!

Europol takes down Elysium, VenomRAT, and Rhadamanthys infrastructure: Europol and law enforcement agencies from more than 30 countries have seized servers, domains, and Telegram channels for three malware services—the Rhadamanthys infostealer, the VenomRAT, and the Elysium botnet.

Authorities say the three malware strains infected hundreds of thousands of users and stole millions of credentials . The stolen credentials were later used to deploy ransomware or steal cryptocurrency.

The takedown was part of Operation Endgame , an Europol-led project that began in 2023 and targets criminal infrastructure that is used to enable ransomware attacks.

In total, authorities seized 1,025 servers, 20 domains, and searched 11 locations. The administrator of the VenomRAT was also arrested following a raid in Greece earlier this month.

[ more on Risky Bulletin ]

China accuses US of stealing stolen crypto: The Chinese government says the US unduly seized crypto-funds that actually belonged to a Chinese crypto-mining company. The US Justice Department seized $15 billion worth of Bitcoin from the operator of scam compounds last month. The US claimed the funds were owned by the Prince Group and its CEO, Chen Zhi. In a report last week, China's CERT says the funds could be traced back to the 2020 hack of Chinese crypto-mining company LuBian. The report echoes a similar blog post from blockchain analysis firm Elliptic. [Editorial note: The machine translation of the CERT China report seems to suggest in one sentence that the US hacked LuBian. I believe that's a mistranslation and not in the tone of the rest of the report, which just wants to shame the US for seizing the wrong funds.]