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Attack hides malware in PNGs and drops custom reverse tunnel on victims' machines

Theregister • August 31, 2026

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An unknown miscreant is using "TerminalFix" to trick unsuspecting users into running PowerShell commands that infect their computers with a reverse tunnel granting attackers access to their networks. Some of the malware is even hidden inside PNG graphics the PC downloads.

TerminalFix is the latest variant of the wildly popular ClickFix initial access method for attackers. This type of social engineering technique tricks users into running malicious commands by promoting them with a phony fix or CAPTCHA verification.

While traditional ClickFix attacks point victims to the Windows Run dialog, TerminalFix directs users to Windows Terminal or PowerShell, which increases the likelihood that they will unknowingly run multi-line scripts on their own computers, Redmond says .

Plus, instead of delivering just one infostealer, this campaign kicks off a multi-stage attack chain that combines DLL sideloading, steganographic payload extraction, and Active Directory reconnaissance. It ultimately deploys a custom reverse tunnel on the infected machine that gives the attacker persistent, network-level proxy access through the compromised device.

Microsoft declined to answer The Register ’s questions, including how many organizations were targeted and victimized in this TerminalFix campaign, and which attacker or criminal crew is responsible for these attacks.

The attack chain begins when the victim interacts with a phony overlay that spoofs the Cloudflare CAPTCHA “verify you are human” checkbox and includes a Cloudflare logo, causing a fake verification command to be copied to the clipboard before the victim pastes it into Windows Terminal or PowerShell.

This command runs a hidden PowerShell script that prints a fake “Starting Cloudflare verification…” message and downloads a ZIP archive from an attacker-controlled server. It extracts the archive under C:\ProgramData and launches a batch file (1.bat) that silently executes LockScreenContentServer.exe.

LockScreenContentServer.exe is a legitimate, signed Windows executable - and it acts as the DLL sideloading host for a second file: dui70.dll. This purports to be a “Windows DirectUI Engine,” but is actually the malicious payload, which executes a second-stage PowerShell script once it’s sideloaded.

The second PowerShell script downloads additional payloads hidden inside PNG images - this is called steganography, and it makes file- and content-type inspection more difficult, and thus easier to hide malicious payloads. In an attempt to further obfuscate the payload and avoid being detected, the attacker split the payload into multiple PNGs.

The PowerShell script downloads the three images, extracts an executable from the first image and two halves of the DLL from the second and third images, and then reassembles the components on disk.

“After extraction, the source images are deleted to reduce forensic artifacts,” Microsoft researchers Sagar Patil, Suriyaraj Natarajan, and Parasharan Raghavan wrote.

The malware establishes redundant persistence through both HKCU\…\Run registry keys and scheduled tasks that re-execute LockScreenContentServer.exe every 60 minutes to ensure it survives reboots.

It then does reconnaissance on the compromised machine, scooping up system information across multiple language configurations including English, Spanish, and German. It also performs domain trust discovery, domain admin enumeration, and Active Directory user and computer searches, while pinging targeted, named servers.

“The observed names correspond to common infrastructure roles, including domain controllers, databases, backup, gateways, and mail systems,” according to the threat hunters. “This probing could help an attacker identify accessible target systems for follow-on activity.”

, the malware drops a persistent PowerShell file-watch loop that monitors a text file for new commands, executes them via Invoke-Expression, and writes results to an output file. This allows the attacker to execute additional PowerShell commands by writing them to the text file.

And finally, the attacker deploys a custom, Python-based reverse-tunnel implant. The tunnel launches with no visible window via pythonw.exe, and it sets up a reverse WebSocket tunnel to gitnow[.]dev:443. This implant, combined with earlier reconnaissance data, gives the attacker SOCKS-style TCP proxy access through the victim’s network.

Microsoft recommends organizations take several steps to avoid becoming a victim of this campaign. These include restricting PowerShell and Run dialog execution, and either blocking or auditing the Windows Run dialog (Win+R) if it’s not needed for daily work.

Also, train employees on how to look for ClickFix tactics, like fake CAPTCHA verification pages that tell them to paste commands into Terminal or the Run dialog. ®

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