Defendants Were Members of the APT 10 Hacking Group Who
Acted in Association with the Tianjin State Security Bureau and Engaged in
Global Computer Intrusions for More Than a Decade, Continuing into 2018,
Including Thefts from Managed Service Providers and
The unsealing of an indictment charging Zhu Hua (朱华),
aka Afwar, aka CVNX, aka Alayos, aka Godkiller; and Zhang Shilong (张士龙),
aka Baobeilong, aka Zhang Jianguo, aka Atreexp, both nationals of the People’s
Republic of China (China), with conspiracy to commit computer intrusions,
conspiracy to commit wire fraud, and aggravated identity theft was announced
today.
The announcement was made by Deputy Attorney General Rod J.
Rosenstein, U.S. Attorney Geoffrey S. Berman for the Southern District of New
York, Director Christopher A. Wray of the FBI, Director Dermot F. O’Reilly of
the Defense Criminal Investigative Service (DCIS) of the U.S. Department of
Defense, and Assistant Attorney General for National Security John C. Demers.
Zhu and Zhang were members of a hacking group operating in
China known within the cyber security community as Advanced Persistent Threat
10 (the APT10 Group). The defendants
worked for a company in China called Huaying Haitai Science and Technology
Development Company (Huaying Haitai) and acted in association with the Chinese
Ministry of State Security’s Tianjin State Security Bureau.
Through their involvement with the APT10 Group, from at
least in or about 2006 up to and including in or about 2018, Zhu and Zhang
conducted global campaigns of computer intrusions targeting, among other data,
intellectual property and confidential business and technological information
at managed service providers (MSPs), which are companies that remotely manage
the information technology infrastructure of businesses and governments around
the world, more than 45 technology companies in at least a dozen U.S. states,
and U.S. government agencies. The APT10
Group targeted a diverse array of commercial activity, industries and
technologies, including aviation, satellite and maritime technology, industrial
factory automation, automotive supplies, laboratory instruments, banking and
finance, telecommunications and consumer electronics, computer processor
technology, information technology services, packaging, consulting, medical
equipment, healthcare, biotechnology, pharmaceutical manufacturing, mining, and
oil and gas exploration and production.
Among other things, Zhu and Zhang registered IT infrastructure that the
APT10 Group used for its intrusions and engaged in illegal hacking operations.
“The indictment alleges that the defendants were part
of a group that hacked computers in at least a dozen countries and gave China’s
intelligence service access to sensitive business information,” said Deputy
Attorney General Rosenstein. “This is
outright cheating and theft, and it gives China an unfair advantage at the
expense of law-abiding businesses and countries that follow the international
rules in return for the privilege of participating in the global economic
system.”
“It is galling that American companies and government
agencies spent years of research and countless dollars to develop their
intellectual property, while the defendants simply stole it and got it for
free” said U.S. Attorney Berman. “As a
nation, we cannot, and will not, allow such brazen thievery to go unchecked.”
“Healthy competition is good for the global economy,
but criminal conduct is not. This is
conduct that hurts American businesses, American jobs, and American consumers,”
said FBI Director Wray. “No country
should be able to flout the rule of law – so we’re going to keep calling out
this behavior for what it is: illegal, unethical, and unfair. It's going to take all of us working together
to protect our economic security and our way of life, because the American
people deserve no less."
“The theft of sensitive defense technology and cyber
intrusions are major national security concerns and top investigative
priorities for the DCIS,” said DCIS Director O’Reilly. “The indictments unsealed today are the
direct result of a joint investigative effort between DCIS and its law
enforcement partners to vigorously investigate individuals and groups who
illegally access information technology systems of the U.S. Department of
Defense and the Defense Industrial Base.
DCIS remains vigilant in our efforts to safeguard the integrity of the
Department of Defense and its enterprise of information technology systems.”
According to the allegations in the Indictment unsealed
today in Manhattan federal court:
Overview
Zhu Hua (朱华), aka Afwar, aka CVNX, aka
Alayos, aka Godkiller, and Zhang Shilong (张士龙), aka Baobeilong, aka
Zhang Jianguo, aka Atreexp, the defendants, both nationals of China, were
members of a hacking group operating in China known within the cyber security
community as the APT10 Group, or alternatively as “Red Apollo,” “CVNX,” “Stone
Panda,” “MenuPass,” and “POTASSIUM.” The
defendants worked for Huaying Haitai in Tianjin, China, and acted in
association with the Chinese Ministry of State Security’s Tianjin State
Security Bureau. From at least in or
about 2006 up to and including in or about 2018, members of the APT10 Group,
including Zhu and Zhang, conducted extensive campaigns of intrusions into
computer systems around the world. The
APT10 Group used some of the same online facilities to initiate, facilitate and
execute its campaigns during the conspiracy.
Most recently, beginning at least in or about 2014, members
of the APT10 Group, including Zhu and Zhang, engaged in an intrusion campaign
to obtain unauthorized access to the computers and computer networks of MSPs
for businesses and governments around the world (the MSP Theft Campaign). The APT10 Group targeted MSPs in order to
leverage the MSPs’ networks to gain unauthorized access to the computers and
computer networks of the MSPs’ clients and to steal, among other data,
intellectual property and confidential business data on a global scale. For example, through the MSP Theft Campaign,
the APT10 Group obtained unauthorized access to the computers of an MSP that
had offices in the Southern District of New York and compromised the data of
that MSP and certain of its clients involved in banking and finance,
telecommunications and consumer electronics, medical equipment, packaging,
manufacturing, consulting, healthcare, biotechnology, automotive, oil and gas
exploration, and mining.
Earlier, beginning in or about 2006, members of the APT10
Group, including Zhu and Zhang, engaged in an intrusion campaign to obtain
unauthorized access to the computers and computer networks of more than 45
technology companies and U.S. government agencies, in order to steal information
and data concerning a number of technologies (the Technology Theft
Campaign). Through the Technology Theft
Campaign, the APT10 Group stole hundreds of gigabytes of sensitive data and
targeted the computers of victim companies involved in aviation, space and
satellite technology, manufacturing technology, pharmaceutical technology, oil
and gas exploration and production technology, communications technology,
computer processor technology, and maritime technology.
In furtherance of the APT10 Group’s intrusion campaigns, Zhu
and Zhang, among other things, worked for Huaying Haitai and registered
malicious domains and infrastructure. In
addition, Zhu, a penetration tester, engaged in hacking operations on behalf of
the APT10 Group and recruited other individuals to the APT10 Group, and Zhang
developed and tested malware for the APT10 Group.
The MSP Theft Campaign
In furtherance of the MSP Theft Campaign, Zhu, Zhang, and
their co-conspirators in the APT10 Group engaged in the following criminal
conduct:
First, after the
APT10 Group gained unauthorized access into the computers of an MSP, the APT10
Group installed multiple variants of malware on MSP computers around the world.
To avoid antivirus detection, the malware was installed using malicious files
that masqueraded as legitimate files associated with the victim computer’s
operating system. Such malware enabled
members of the APT10 Group to monitor victims’ computers remotely and steal
user credentials.
Second, after
stealing administrative credentials from computers of an MSP, the APT10 Group
used those stolen credentials to connect to other systems within an MSP and its
clients’ networks. This enabled the APT10 Group to move laterally through an
MSP’s
network and its clients’ networks and to compromise victim computers that were
not yet infected with malware.
Third, after
identifying data of interest on a compromised computer and packaging it for
exfiltration using encrypted archives, the APT10 Group used stolen credentials
to move the data of an MSP client to one or more other compromised computers of
the MSP or its other clients’ networks before exfiltrating the data to other
computers controlled by the APT10 Group.
Over the course of the MSP Theft Campaign, Zhu, Zhang, and
their co-conspirators in the APT10 Group successfully obtained unauthorized
access to computers providing services to or belonging to victim companies
located in at least 12 countries, including Brazil, Canada, Finland, France,
Germany, India, Japan, Sweden, Switzerland, the United Arab Emirates, the
United Kingdom, and the United States.
The victim companies included at least the following: a global financial institution, three
telecommunications and/or consumer electronics companies; three companies
involved in commercial or industrial manufacturing; two consulting companies; a
healthcare company; a biotechnology company; a mining company; an automotive
supplier company; and a drilling company.
The Technology Theft Campaign
Over the course of the Technology Theft Campaign, which
began in or about 2006, Zhu, Zhang, and their coconspirators in the APT10 Group
successfully obtained unauthorized access to the computers of more than 45
technology companies and U.S. Government agencies based in at least 12 states,
including Arizona, California, Connecticut, Florida, Maryland, New York, Ohio,
Pennsylvania, Texas, Utah, Virginia and Wisconsin. The APT10 Group stole hundreds of gigabytes
of sensitive data and information from the victims’ computer systems, including
from at least the following victims: seven companies involved in aviation, space
and/or satellite technology; three companies involved in communications
technology; three companies involved in manufacturing advanced electronic
systems and/or laboratory analytical instruments; a company involved in
maritime technology; a company involved in oil and gas drilling, production,
and processing; and the NASA Goddard Space Center and Jet Propulsion
Laboratory. In addition to those victims
who had information stolen, Zhu, Zhang, and their co-conspirators successfully
obtained unauthorized access to computers belonging to more than 25 other
technology-related companies involved in, among other things, industrial
factory automation, radar technology, oil exploration, information technology
services, pharmaceutical manufacturing, and computer processor technology, as
well as the U.S. Department of Energy’s Lawrence Berkeley National Laboratory.
Finally, the APT10 Group compromised more than 40 computers
in order to steal sensitive data belonging to the Navy, including the names,
Social Security numbers, dates of birth, salary information, personal phone
numbers, and email addresses of more than 100,000 Navy personnel.
*
* *
Zhu and Zhang are each charged with one count of conspiracy
to commit computer intrusions, which carries a maximum sentence of five years
in prison; one count of conspiracy to commit wire fraud, which carries a
maximum sentence of 20 years in prison; and one count of aggravated identity
theft, which carries a mandatory sentence of two years in prison.
The maximum potential sentences in this case are prescribed
by Congress and are provided here for informational purposes only, as any
sentencing of the defendants will be determined by the assigned judge. The charges contained in the Indictment are
merely accusations and the defendants are presumed innocent unless and until
proven guilty.
The case was investigated by the FBI, including the New
Orleans, New Haven, Houston, New York, Sacramento, and San Antonio Field
Offices; DCIS; and the U.S. Naval Criminal Investigative Service (NCIS). Mr. Rosenstein, Mr. Berman and Mr. Demers
praised the outstanding investigative work of, and collaboration among, the
FBI, DCIS, and NCIS. They also thanked
the U.S. Attorney’s Office for the District of Connecticut, and the Department
of Defense’s Computer Forensic Laboratory for their assistance in the
investigation.
Assistant U.S. Attorney Sagar K. Ravi of the Southern
District of New York’s Complex Frauds and Cybercrime Unit is in charge of the
prosecution, with assistance provided by Trial Attorney Matthew Chang of the
National Security Division’s Counterintelligence and Export Control Section.
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