Iranian Cyber Group OilRig Targets Iraqi Government in Sophisticated Malware Attack

Iraqi government networks have emerged as the target of an “elaborate” cyber attack campaign orchestrated by an Iran state-sponsored threat actor called OilRig.

The attacks singled out Iraqi organizations such as the Prime Minister’s Office and the Ministry of Foreign Affairs, cybersecurity company Check Point said in a new analysis.

OilRig, also called APT34, Crambus, Cobalt Gypsy, GreenBug, Hazel Sandstorm (formerly EUROPIUM), and Helix Kitten, is an Iranian cyber group associated with the Iranian Ministry of Intelligence and Security (MOIS).

Active since at least 2014, the group has a track record of conducting phishing attacks in the Middle East to deliver a variety of custom backdoors such as Karkoff, Shark, Marlin, Saitama, MrPerfectionManager, PowerExchange, Solar, Mango, and Menorah for information theft.

The latest campaign is no exception in that it involves the use of a new set of malware families dubbed Veaty and Spearal, which come with capabilities to execute PowerShell commands and harvest files of interest.

“The toolset used in this targeted campaign employs unique command-and-control (C2) mechanisms, including a custom DNS tunneling protocol, and a tailor-made email based C2 channel,” Check Point said.

“The C2 channel uses compromised email accounts within the targeted organization, indicating that the threat actor successfully infiltrated the victim’s networks.”

Some of the actions that the threat actor took in executing the attack, and following it, were consistent with tactics, techniques, and procedures (TTPs) that OilRig has employed when carrying out similar operations in the past.

This includes the use of email-based C2 channels, specifically leveraging previously compromised email mailboxes to issue commands and exfiltrate data. This modus operandi has been common to several backdoors such as Karkoff, MrPerfectionManager, and PowerExchange.

The attack chain is kicked off via deceptive files masquerading as benign documents (“Avamer.pdf.exe” or “IraqiDoc.docx.rar”) that, when launched, pave the way for the deployment of Veaty and Spearal. The infection pathway is likely said to have involved an element of social engineering.

The files initiate the execution of intermediate PowerShell or Pyinstaller scripts that, in turn, drop the malware executables and their XML-based configuration files, which include information about the C2 server.

“The Spearal malware is a .NET backdoor that utilizes DNS tunneling for [C2] communication,” Check Point said. “The data transferred between the malware and the C2 server is encoded in the subdomains of DNS queries using a custom Base32 scheme.”

Spearal is designed to execute PowerShell commands, read file contents and send it in the form of Base32-encoded data, and retrieve data from the C2 server and write it to a file on the system.

Also written .NET, Veaty leverages emails for C2 communications with the end goal of downloading files and executing commands via specific mailboxes belonging to the gov-iq.net domain. The commands allow it to upload/download files and run PowerShell scripts.

Check Point said its analysis of the threat actor infrastructure led to the discovery of a different XML configuration file that’s likely associated with a third SSH tunneling backdoor.

It further identified an HTTP-based backdoor, CacheHttp.dll, that targets Microsoft’s Internet Information Services (IIS) servers and examines incoming web requests for “OnGlobalPreBeginRequest” events and executes commands when they occur.

“The execution process begins by checking if the Cookie header is present in incoming HTTP requests and reads until the; sign,” Check Point said. “The main parameter is F=0/1 which indicates whether the backdoor initializes its command configuration (F=1) or runs the commands based on this configuration (F=0).”

The malicious IIS module, which represents an evolution of a malware classified as Group 2 by ESET in August 2021 and another APT34 IIS backdoor codenamed RGDoor, supports command execution and file read/write operations.

“This campaign against Iraqi government infrastructure highlights the sustained and focused efforts of Iranian threat actors operating in the region,” the company said.

“The deployment of a custom DNS tunneling protocol and an email-based C2 channel leveraging compromised accounts highlights the deliberate effort by Iranian actors to develop and maintain specialized command-and-control mechanisms.”

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