US charges Chinese citizens over global hacking scam that also hit Indian govt

Washington: The US Justice Department has charged five Chinese citizens with hacking over a 100 companies and institutions across the world, including Government of India networks, stealing valuable software data and business intelligence.

Deputy US Attorney General Jeffrey Rosen on Wednesday announced three indictments have been unsealed in the matter that collectively charge five Chinese nationals with computer hacking and charge two Malaysian nationals for helping some of those hackers target victims and sell the fruits of their crime.

The Malaysian nationals were arrested on Sunday and the Chinese nationals have been declared fugitive, according to a Justice Department statement.

Rosen heavily criticised the Chinese government. “The Department of Justice has used every tool available to disrupt the illegal computer intrusions and cyberattacks by these Chinese citizens. Regrettably, the Chinese Communist Party has chosen a different path—of making China safe for cyber-criminals so long as they attack computers outside China and steal intellectual property helpful to China,” the deputy attorney general said.

“In about 2019, the conspirators compromised government of lndia websites, as well as virtual private networks and database servers supporting the Government of India. The conspirators used VPS PROVIDER servers to connect to an Open VPN network owned by the Government of India,” the indictment said.

In the attacks, the conspirators installed ‘Cobalt Strike’ malware on Indian government-protected computers, it added.

According to the charges, the computer intrusions affected over 100 companies in the US and abroad.

The victims ranged from software development, computer hardware, telecommunication, social media and video game companies. Non-profit organisations, universities, think tanks, foreign governments, pro-democracy politicians and activists in Hong Kong were also targeted.

Security researchers have tracked the intrusions using labels “APT41,” “Barium,” “Winnti,” “Wicked Panda” and “Wicked Spider”.

These intrusions facilitated the theft of source code, software code-signing certificates, customer account data and valuable business information, the researchers said.

These intrusions also facilitated the defendants’ other criminal schemes, including ransomware and “crypto-jacking” schemes, the latter refers to the group’s unauthorised use of victim computers to mine cryptocurrency.

The Chinese hackers also targeted government computers and networks of Vietnam and UK. The hackers, however were not successful in compromising the government computer networks in the UK.

The racketeering conspiracy pertained to the three defendants’ conducting the affairs of Chengdu 404 Network Technology (“Chengdu 404”), a Chinese Government company, through a pattern of racketeering activity involving computer intrusion offenses affecting over 100 victim companies, organisations, and individuals in the UK and around the world, including in Australia, Brazil, Chile, Hong Kong, India, Indonesia, Japan, Malaysia, Pakistan, Singapore, South Korea, Taiwan, Thailand and Vietnam, the Justice Department said.

“Today’s announcement demonstrates the ramifications faced by the hackers in China but it is also a reminder to those who continue to deploy malicious cyber tactics that we will utilise every tool we have to administer justice,” said FBI Deputy Director David Bowdich.

Noting that the scope and sophistication of the crimes are unprecedented, Acting US Attorney for the District of Columbia Michael R. Sherwin said some of these criminal actors believed their association with the People’s Republic of China provided them free licence to hack and steal across the globe.

“This scheme also contained a new and troubling cyber-criminal component—the targeting and utilisation of gaming platforms to both defraud video game companies and launder illicit proceeds,” Sherwin said.

Rosen told reporters that as an additional method of making-money, several of the Chinese defendants compromised the networks of video game companies worldwide—a billion-dollar industry—and defrauded them of in-game resources. “Two of the Chinese defendants stand accused, with two Malaysian defendants, of selling those resources in the black market, through their illicit website,” he said.

Asserting that the Chinese government has the power to help stop crimes like these, Rosen alleged that the Chinese Government has made a deliberate choice to allow its citizens to commit computer intrusions and attacks around the world because these actors will also help them.